FedEx Announces 2006 Rates

Effective Jan. 2, Federal Express Corp.’s commercial ground services rates will increase by 3.9%, and its air and international services will increase by 5.5%.

FedEx had announced rate increases for express services in October. Those are also effective Jan. 2. (See “FedEx Announces Express Rate Hikes.”)

The newly announced FedEx increases are identical to the January rate hikes announced by United Parcel Service just before Thanksgiving holiday (see “UPS Announces 2006 Rate Hikes,” but FedEx spokesperson Jim McClusky won’t make any comparisons. “We don’t comment on anything our competitors are doing,” he says. “We just follow industry standards based on competitive issues and our overall yearly costs.”

Other FedEx rates changes scheduled for Jan. 2 include:

• The delivery area surcharge for certain zip codes will increase by $0.05 for commercial locations and $0.10 for residential locations.

• There will be a $0.10 residential surcharge increase on both ground and express (air) services, plus a $0.25 per package rate increase for FedEx Home Delivery.

• Packages requiring a direct signature will cost $0.25 more, and when an adult signature is needed the rate will increase by $0.50.

• There will be an additional handling surcharge of $1.00 per package on all express and ground packages, as well as increases of $1.00 on all packages subject to COD and electronic COD charges.

McClusky says that FedEx is currently gearing up for a surge in holiday shipping, with Dec. 12 targeted as the busiest day of the year. “Between all of our companies combined, we are projecting delivery of 8.5 million packages that day,” he says, “or about 60% more than our average daily haul throughout the year.”