FedEx will raise shipping rates in January and provided details on Thursday. FedEx Express, FedEx Ground, and FedEx Home Delivery rates will increase by an average of 6.9%. However, online sellers should look into details about fees, as rates for some of the services they use could be higher than the average cited.
Sellers on some marketplaces will also pay higher fees as a result of the higher shipping rates, since eBay and Etsy charge commission fees on shipping costs.
FedEx will implement the higher rates on January 2, 2023. It will also raise FedEx Freight rates by an average of 6.9%-7.9% depending on the customer’s transportation rate scale.
The shipping carrier disclosed the new rates as part of its financial earnings release for the latest quarter. As CNBC noted, “The shipping giant struggled with light volumes in the quarter, citing headwinds in its Europe and Asia markets. The poor results shocked the market, as investors tried to distinguish market woes from FedEx’s own internal shortcomings.”
FedEx said it was implementing cost-cutting measures “in order to align fiscal 2023 costs with demand due to a weaker-than-expected business environment.”
FedEx CEO Raj Subramaniam said: “We’re moving with speed and agility to navigate a difficult operating environment, pulling cost, commercial, and capacity levers to adjust to the impacts of reduced demand. As our team continues to work aggressively to address near-term headwinds, we’re meaningfully strengthening our business and customer experience, including delivering an outstanding peak.”
Emma Cosgrove of Business Insider said in addition to the 6.9% average rate increase, FedEx is raising surcharges on rural packages – and noted UPS had done the same last year.
You can find the full press release on the FedEx website.