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Carrier Surcharge Update

UPS has made two important surcharge announcements that all parcel shippers need to take note of.

First, it was announced that peak surcharges, (unrelated to holiday season shipping) would be reinstated effective January 16, 2022.  While the specific surcharges have been in effect since October 3rd, they are in reality an extension of peak surcharges that have been in place since the beginning of the global COVID pandemic.

When the recent October peak surcharges were announced, many shippers understood the additional costs to have an end date of January 15, 2022 (and finally a break from the string of peak surcharges dating back to 2019!). The previously announced date, coupled with UPS reporting over $500 million in surcharge revenue during the first 9 months of 2021, were seen as real signs such peak surcharges would finally be eliminated.

That’s proven to not be the case, unfortunately. With Omicron variant headlines dominating the news, UPS has announced it is not only reinstating peak surcharges but doing so with no expiration date. Whether the reason is the ever-present potential for additional lockdowns or another factor, shippers now have this additional variable to consider as they are finalizing their 2022 budgets and in preparation for Sunday when UPS’s GRI goes into effect.

Here are the details of the announcement:

For further information on the UPS website, click this link. 

Fuel Surcharge Table Updates

Also announced is an increase in the carrier’s fuel surcharges, going into effect on January 3, 2022. The increases will apply to Domestic Ground and Air shipments. Note that the International fuel surcharge is unaffected at this time.

Prior to this announcement, the UPS fuel surcharge was less expensive than that of FedEx. But now, UPS has lost its pricing advantage on fuel thanks to an average 9.16% increase on its Ground surcharge and 7.03% on Domestic Air shipments.

Here are comparisons of the new and old surcharge tables.

The carrier’s full announcement can be read here.

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