UPS and FedEx GRIs and Service Guide Changes for 2022

Shippers can expect increased shipping expenses as UPS and FedEx have announced significant General Rate Increases (GRI) for 2022.

Customers who use FedEx Freight shipping services FXF PZONE and FXF EZONE should expect an average increase of 5.9%. For those using FXF 1000 and 501, the number will rise to 7.9%. In addition, shippers using FedEx Express, FedEx Ground, and FedEx Freight can expect fuel surcharges in addition to the GRIs.

Shortly after FedEx made its announcement, UPS unveiled matching General Rate Increases (GRI) for UPS Ground, UPS Air, and international services, averaging 5.9%. In addition, the GRIs come with increased fuel surcharges and peak surcharges, which UPS has renamed Peak/Demand Surcharges.

UPS and FedEx have also modified the names for surcharges in response to the increased demand caused by the pandemic. As a result, peak surcharges are now “peak demand” levies, and shippers will have to pay them outside the traditional peak season.

UPS and FedEx’s GRIs will hit historic highs in 2022

Altogether, UPS and FedEx’s GRIs for 2022 mark their most substantial hikes in nearly a decade. While some of these increases and surcharges occurred during Q4, most will roll in January 2022.

The steep GRIs come after a year where both carriers have seen skyrocketing demand along with soaring operating costs, thanks to increases in labor costs, staff shortages, and gummed-up supply chains.

The past year shaped up to be the most profitable ever for UPS. FedEx reported double-digit increases in yield for all its transportation modes, including FedEx Freight’s highest margins to date. Still, UPS has fared much better during the pandemic after cutting costs and growing more lucrative small and mid-sized business volumes. FedEx has not managed to perform as well, thanks in significant part to increased operating costs, labor-induced constraints, and losses on its bulk air cargo business that have been eating away a good amount of the company’s pandemic gains.

Shippers can adapt to UPS and FedEx’s GRIs for 2022

While the carriers’ strategic partnerships with larger companies could eventually alleviate the increased prices in the long term, shippers should prepare for the increased costs to be around for a while.

Shippers don’t have to be burdened with UPS and FedEx’s GRIs. CTSI-Global’s Honeybee TMS™ allows shippers to source and compare quotes from over 20,000 carriers to ensure they’re always getting the best rates. In addition, our Freight and Audit Pay solution can help maximize your savings by catching freight invoice errors and avoiding unnecessary surcharges.

Don’t let the new UPS and FedEx GRIs slow you down. Contact us and get the tools you need to stay afloat in 2022.