Read on to find out just what’s changing on December 26th and how it will affect you.
On December 5th, 2018, UPS dropped big news on their customers, right in the middle of an already stressful peak season. The Atlanta-based shipping giant has announced that rate changes are set to take effect on December 26; just a day after Christmas and with only weeks of notice. These increases are intended to support ongoing expansion and capability enhancements for UPS.
Jerry Hempstead, president of Hempstead Consulting, explained that the timing of this announcement was different, in that last year UPS announced its 2018 rate increases in October, and the prior year they were announced in early September. “This year (UPS) announced it three weeks before the effective date and in the heat of the fourth quarter peak shipping,” said Hempstead. “Large shippers will have little time nor the IT resources to sift through the nuances of this year’s announced changes.”
While 4.9% is the average increase across ground, air and international, there are many charges that exceed that total. For instance, UPS SurePost rates for packages under 1 lb. will go up 10.1% to $8.52, rising 9.9% to $8.416 for packages over 1 lb. SurePost is a hybrid service where packages are inducted into local U.S. Postal Service DDUs for final-mile delivery.
There are also substantial hikes in surcharges for additional handling weight (from $12 in 2017 to $23 for 2019, up 91.7%), large package ($80 to $115, up 43.7%) and over-maximum limits ($500 to $850, up 70%).
Here are some of the key takeaways from this year’s rate changes:
- The rates for UPS® Ground, UPS Air and International services will increase an average net 4.9%
- The Address Correction charge will increase $0.50, and the per shipment maximum will increase $3.50
- The Additional Handling charge for any U.S. Domestic package exceeding 70 pounds in actual weight will increase $4.00. The Additional Handling charge for all other packages will increase $2.25
- A processing fee of $2.00 will be added per package with Package Level Detail (PLD) if not provided prior to delivery
- The charge for Collect on Delivery (C.O.D.) will increase $1.00
- The charge for Delivery Confirmation Signature Required will increase $0.25
- The Hazardous Materials charge for domestic UPS® Ground Services will increase $2.00
- Increased third-party billing rate from 2.5% to 4.5% of the shipment price
- The rates for UPS Air Freight within and between the U.S., Canada, and Puerto Rico will increase an average net 4.9%
- The Large Package Surcharge for U.S. Domestic commercial packages will increase $15.00 and the Large Package Surcharge for U.S. Domestic residential packages will increase $25.00
- Effective December 31, 2018, the Domestic Air Fuel Surcharge will increase by 0.25% for all thresholds. These surcharges will continue to be based on the national Average U.S. Gulf Coast Jet Fuel Price and adjusted weekly
- See other 2019 UPS Package Accessorial Changes here
How will this affect you, as a ProShip customer?
At ProShip, we are committed to providing our customers with all UPS options and updates as soon as they are available. With the new 2019 rate changes, there is no impact to ProShip customers that use the ProShip Update Tool. The new UPS rates will already have been downloaded and updated on your system.
No matter what carrier(s) you use, businesses need to investigate their shipping mix to determine if they’re making the right shipping decisions in 2019. As rate increases are put into place, shippers will have to budget accordingly.