2013 FedEx GRI White Paper

01/07/2013

“Effective January 7, 2013, FedEx will be issuing increases to their rates and services. FedEx Express package and freight rates will increase on average of 5.9% for U.S. export and U.S. Import Services. The shipping rate increase will be partially offset by adjusting the fuel price at which the fuel surcharge begins, reducing the fuel surcharge by 2 percentage points. FedEx Ground and Home Delivery rates increased an average of 5.9%. The shipping rate increase was partially offset by adjusting the fuel price at which the fuel surcharge begins, reducing the fuel surcharge by 1 percentage point.”

The key word that is annually used is average; FedEx announces the increases as an average percentage. The true impact will vary based on service. This analysis will outline and give you detailed information on the actual percentage increases for each service. RAFL will provide you with a true forecast of the increase expected for your 2013 budget. As a result of our years of experience combined with our robust analytic tools, RAF Logistics can provide you with a true impact of these rate increases.

What FedEx fails to mention is that the announced percentage points for the fuel surcharge is already “factored” into their base rates, depending on the type of service. As a result, despite the announced surcharge reductions, shippers are actually paying more for fuel because the charges are being levied from the base rates that increase annually.

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