Here are the things parcel shippers need to be aware of…
On October 28, 2021, UPS announced their 2022 General Rate Increase (GRI), following FedEx’s GRI announcement in late September. Like FedEx, the UPS rates for UPS Ground, UPS Air and International services will increase by an average of 5.9%, one whole percentage point above the 2021 GRI. It is important to note that while this is the average, there are quite a few outliers.
UPS Rate Changes and Surcharge Increases
The 5.9% GRI mentioned above will go into effect December 26th, 2021, unlike FedEx’s GRI, which goes into effect January 3, 2022.
UPS also noted the following surcharge changes that take effect:
- Large Package Surcharge: Increase of 8% – 16.7%
- Additional Handling of Large Packages: Increase of 5.2% – 13.9% depending on zone
- Dangerous Goods/Hazmat Shipping: Increase of 12.8% – 13%
- Residential Delivery and Delivery Area Surcharge (DAS) / Extended Delivery Area Surcharge (EDAS): Increase by at least 7%
- Effective January 9th, zip codes for DAS and EDAS will change. Also, a new remote surcharge has been added that applies to around 2,700 zip codes. New in 2022? UPS added a new DAS called US48 Remote Area Surcharge (RAS).
- All in all, roughly 4.7 million addresses will now be more expensive to deliver to than in 2021 with these increases.
- Fuel Surcharge (effective as early as November 15th) for Ground and Air services: Increase by 1%
- This is the 3rd time UPS has increased fuel surcharges this year
[View] Full list of 2022 UPS rates
Also important is the hit lightweight shippers will continue to take, where the rate for 1-5lb ground packages will increase by around 8%, with the minimum charge increasing from $8.76 to $9.36.
UPS Peak Surcharge Update – International Shippers
Additionally, it is key to note the peak surcharge announcement UPS made on October 29th. Effective November 7, 2021, the amount of the Peak Surcharges applied to U.S. shipments will change until further notice:
- Shipments from China Mainland, Hong Kong SAR, and Macau SAR to the U.S.
- Shipments from Vietnam to the U.S. (up to a 77.5% increase!)
- Shipments from Japan to the U.S.
- Shipments from Australia, New Zealand, and other Asia origins to U.S.
- Shipments from Europe origins to the U.S. and North America
- International Shipments from all origins to all destinations (except those covered above)
- Additional Handling, Large Packages and Packages Over Maximum Limits
- UPS Ground Residential and UPS SurePost Packages
- UPS Air Residential, UPS Ground Residential and UPS SurePost Packages
ProShip’s Thoughts on 2022 UPS GRI
Like other carriers, UPS claims the increases are implemented to “support ongoing expansion and capability enhancements” as they strive to remain competitive in the shipping business and deliver on client expectations.
While time has run out to onboard additional carriers this year, it’s important to look into diversifying your carrier mix in 2022 to avoid massive rate increases and lessen shipping costs within your supply chain.
- Look at alternatives (like LaserShip/OnTrac), other regional carriers and USPS.
- Make the data points you’ll gain during the 2021 peak season actionable.
- Find the technology that pulls it all together and makes complex parcel shipping challenges simple and cost-effective.
For more information on the 2022 UPS GRI, visit the UPS Rate Change Information page.