“SmartPost,” a service performed in conjunction with the
U.S. Postal Service (USPS). Those rates, which apply to
packages tendered by FedEx to USPS for last-mile deliveries to residences, had yet to be announced, though the
company said those would increase as well.
FedEx’s ground-parcel customers will also absorb higher
rates than the average increase, mostly for lighter-weight
parcels, according to Shipware data. Rates charged by
FedEx Ground, the company’s ground-delivery unit, will
rise 5. 8 percent for parcels weighing one to five pounds.
Rates will rise 5. 5 percent for parcels weighing six to 10
pounds, 5. 4 percent for parcels weighing 11 to 15 pounds,
and 5 percent for parcels weighing 16 to 20 pounds, according to Shipware data. Most packages tendered for ground
deliveries weigh less than 20 pounds. By contrast, rates on
packages weighing 51 to the maximum of 150 pounds will
increase less than the average, according to Shipware.
The 2016 ground increases will be distributed more
evenly across the weight classes than were the 2015 ground
increases. In 2015, the hikes were heavily skewed toward
lighter-weight traffic, Shipware said. The minimum delivery charge for transporting a ground package
will be $6.94, a 5-percent increase from 2015
levels, Shipware said; between 2006 and 2016,
the minimum charge for ground deliveries
will have risen a cumulative 82.6 percent,
Shipware said.
The consultancy said it would analyze the
impact of rate increases by FedEx Freight, the
company’s less-than-truckload (LTL) unit,
and for its international services at a later date.
In recent years, both FedEx and archrival
UPS Inc., which hold a near-duopoly on U.S.
business-to-business (B2B) parcel services,
have raised their rates on certain traffic segments at higher levels than the announced
averages, depending on the type of service
or, more frequently, the weight breaks of the
shipments. Atlanta-based UPS had not disclosed its 2016 rate increases as of this writing.
Rob Martinez, Shipware’s president and
CEO, said the faster pace of increases on the
less-urgent FedEx Express services reflects
increased customer demand and higher costs
to provide the services. “The fact that FedEx
and UPS continue to levy higher increases on less-premium express services ... than
[on] more premium products ... indicates to
me that those services carry a higher cost to
serve,” Martinez said in an e-mail.
FedEx Corp.’s noncontract air customers will see their 2016
rates rise at a faster clip for slower transit times than for the
company’s premium services that promise faster deliveries,
according to data from parcel consultancy Shipware LLC.
According to Shipware data, domestic rates for “Priority
Overnight” service, which guarantees deliveries by 10: 30
a.m. the next day to most U.S. addresses, will rise by 4.69
percent. From there, however, the costs escalate well above
the average increase. Prices for deliveries using the unit’s
“Standard Overnight” service, where parcels are delivered by 3 p.m. the next day, will climb by 6.05 percent,
according to Shipware data. Rates for second-day morning
deliveries will increase by 7. 6 percent, two-day afternoon
services by 7.67 percent, and three-day deliveries, known
as “Express Saver,” by 7. 34 percent, Shipware said. The
services are offered by FedEx Express, the company’s air
and international unit.
Memphis, Tenn.-based FedEx announced in mid-Sep-
tember that it would raise its published rates, effective Jan.
4, by an average of 4. 9 percent on U.S. domestic and U.S.
export and import services. The one exception is FedEx
newsworthy
20 DC VELOCITY OCTOBER 2015 www.dcvelocity.com
Think slower means cheaper?
Not if you’re a FedEx customer in 2016
LoadDelivered, a third-party logistics firm headquartered in
Chicago, and enVista, a supply chain consulting and IT services firm, have been named to the Inc. 5000 list of America’s
fastest-growing private companies. … CIO Review has named
Optricity to its list of “20 Most Promising Logistics Solutions
Providers of 2015.” Optricity also received the Corporate Supply
Chain of the Year award at the Supply Chain Management
Summit hosted by Bryant University in Providence, R.I. …
Crown Equipment Corp. recently presented four dealers in Latin
America and the Caribbean with Ascent awards for delivering
outstanding sales and service performance results in 2014. The
award recipients were Marine Power Ltd. (Cayman Islands), IMEQ
Dominicana S.A. (Dominican Republic), Lift Trucks & Parts Inc.
(Puerto Rico), and Momatt SA de C.V. (Mexico). … XPO Logistics
Inc., a global provider of transportation and logistics solutions,
has been recognized by Whirlpool Corp. as its Intermodal Carrier
of the Year. … At a ceremony in December, the Containerization
and Intermodal Institute will present the 2015 Connie award to
Wolfgang Freese, president of Hapag-Lloyd, Region Americas,
and a Lifetime Achievement award to Joanne F. “Joni” Casey,
president and CEO of the Intermodal Association of North
America. … Echo Global Logistics has honored Reddaway and
Holland with awards for outstanding regional less-than-truckload (LTL) service within their networks.
accolades
