UPS to Hike Rates 6 Percent in 2024, Will Nearly Double Peak Surcharge

UPS will raise rates 6% in 2024 – or 5.9% on December 26, 2023, to be exact – publishing the news about 10 days after FedEx announced it would raise rates an average of 5.9% on January 1, 2024. UPS will also raise peak surcharges, which it calls “demand surcharges.”

And like FedEx, UPS did not publish specifics, only publishing an overview of the average rate increases, which it said would “help support ongoing expansion and capability enhancements as we strive to maintain the high service levels you expect from UPS.”

UPS is also changing zones and how it will charge for “area surcharges.”

Package
The following changes will be effective December 26, 2023. Previews will be available later.

The rates for UPS® Ground, UPS Air and International services will increase an average net 5.9%.
The list of ZIP Codes to which Area Surcharges apply will change.
The list of ZIP Codes aligned to certain zones will change
*The impact of these changes on your shipping costs will vary according to your shipping characteristics and the terms of your UPS agreement.

UPS is also changing its “demand surcharge” in effect from October 1, 2023 through January 13, 2024, for certain domestic and international shipments. An example of domestic peak surcharges: the “Additional Handling” surcharge is currently $3.50 per package; it will rise to $6.90 per package during the holiday shipping season – an increase of nearly 100%.

You can find the rate-change notice on the UPS website.

As we noted last week when FedEx announced its 2024 rates, higher shipping rates mean sellers on sites like eBay and Etsy will pay more in fees, since the marketplaces charge sellers not only payment-processing fees, but commission fees on the total transaction amount, including shipping and handling. That means the platforms make more money without having to announce a rate increase to their sellers.

Interestingly eBay announced this week it would change how it collects shipping costs for sellers who print shipping labels for UPS and FedEx through the eBay shipping label program. eBay will begin charging sellers for UPS and FedEx shipping labels at the time of printing; previously it charged sellers after delivery.

Ina Steiner

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.