FedEx – UPS General Rate Increase 2025

UPS and FedEx both announced an increase of 5.9% in 2025 General Rate Increase (GRI). The FedEx Increase is effective January 6, 2025, and the UPS effective rate is two weeks earlier, on December 23, 2024.

The General Rate Increase impact varies depending on the shipping characteristics of each company and the terms with each carrier. In simple terms, very few shippers will see an increase equivalent to 5.9%, and it will be higher. For shippers to maintain their cost and profitability, you must understand how the base rate and surcharge changes will impact your 2025 spend.

Here are some important takeaways for all shippers to note for the upcoming changes.

(1) UPS and FedEx match GRI of 5.9% 

Each carrier may have an “average” of 5.9%, but they differ, with each shipper having a different impact.

(2) Hidden Cost Increases that may go unannounced

Carriers continue to change surcharges like expanding DAS Surcharges by ZIP code.

This is difficult to track as it may be a slight increase in cost, but all these little changes add up.

(3) Longer Zones have the greatest increase

There will be an increase across all weight breaks and services with at or above 5.9%, but longer zones will have a greater increase

(4) Minimum Charges

For shippers with negotiated discounts, UPS’s minimum charge protects against deep discounts. This means that the actual charge will be greater than the minimum or discounted shipping rate even with a substantial discount. These GRIs, in the minimum charge, can significantly impact overall shipping costs.

(5) Most all Surcharges will be greater than the 5.9% GRI

Depending on the shipping profile, the surcharges can have a massive impact on pricing. Surcharges normally account for 20-40% of a shipper’s annual spend.

The best example would be shippers with larger packages, who will see additional handling and large package surcharge increases of over 26.5% on average.

How can you prepare for 2025?

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The opinions expressed do not necessarily reflect the views of the Firm, its clients, or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.