UPS Raises 2025 Rates — Effective December 23

UPS recently unveiled a general rate increase (GRI) of 5.9% for 2025. This shouldn’t come as a surprise to anyone, since FedEx also announced a 5.9% GRI last month. In recent years, these two parcel giants have mirrored each other’s general rate hikes, as well as new fuel surcharges.

What’s surprising is the timing of the general rate increase for 2025. It’s effective on December 23, 2024 — which is the earliest any carrier has introduced an annual rate change. It’s clearly a move to capitalize on the tail end of the holiday shipping season by piling incremental fees on top of the peak-season surcharges UPS announced back in July. 

But that’s not the full story. UPS is also adding a 2.0% fee for credit card transactions, accessorial fees are rising, and more prices increases are coming on January 27, 2025. Although we don’t have specifics yet, the carrier plans to change its surcharge calculations for large packages based either on length, weight or cubic volume of shipments. History has shown that these new calculations will probably favor UPS and not the shipper. Parcel shipping via UPS is never likely to decrease in price. 

The actual impact of all these changes will depend on each shipper’s unique profile in terms of package size and weight, delivery distance, urgency, service used and other characteristics. But this announcement is bad news for parcel shippers. 

Whether It’s 2024 or 2025, Redwood Has Your Back  

However, there is some good news. Redwood knows exactly how to help you mitigate the effects of these new charges, as well as the timing.  

Every day, our experienced Parcel Advisory team applies leading-edge tools, methods and analytics to minimize customers’ shipping budgets, while maximizing service. These experts look at your shipping volumes, timelines, package characteristics, delivery modes, destinations and other data. Based on that analysis, they can optimize your carrier mix — including looking beyond the big carriers — as well as explore strategies like zone skipping and network redesign to avoid carrier surcharges.     

And, while UPS and FedEx publish their “official” rates, Redwood understands that parcel shipping charges are always open to negotiation. Both UPS and FedEx have been known to offer some steep discounts to win customers’ business — so trust us when we say that there is leeway. Our parcel experts can help you realize and leverage your power as a shipper. We can coach you through successful carrier negotiations that lead to significant savings on published rates. 

Believe us when we say the benefits of working with Redwood are real. Our Parcel Advisory team saves customers an average of 15% in the first year alone. 

Make Your Next Move with Redwood 

Starting back in July, UPS and FedEx have introduced a seemingly endless stream of new surcharges, add-ons and rate hikes. It’s exhausting for your team to navigate this complex maze of fees when you’re trying to get parcels out the door each day. And you have other pressing challenges, like labor shortages and demand volatility. That’s why Redwood has created a full range of services and solutions specifically aimed at supporting parcel shippers.  

Whether it’s October, December or January, you can count on Redwood to have your back. Let’s get started on your optimized parcel shipping plan for 2024, 2025 and beyond. Contact our expert team today and stop worrying about the next big move from UPS. The only move that really matters is yours.