Get ready to pony up even more for packages in the new year. FedEx plans to increase shipping rates of ground, freight and express services by an average of 4.9%, effective January 5. Those increases are on top of the delivery giant’s decision to start charging for box size as well as weight in January. Dimensional weight pricing will effectively increase prices on some ground shipments.
FedEx is facing increased competition, with the U.S. Postal Service cutting rates for some Priority Mail packages and tech companies like Google, Uber and Amazon experimenting with delivering packages themselves.
In August, regulators approved the Postal Service’s plan to cut postage as much as 58% on certain Priority Mail packages for customers shipping at least 50,000 parcels a year. The Postal Service claimed its prices were too high to be competitive, but rivals FedEx and UPS disagreed. “[The cuts] do not reflect a minor cost-related adjustment in the postage that Grandma will have to pay to send a sweater to young Johnny,” wrote FedEx in its filing with the Postal Regulatory Commission in July. “What USPS is proposing is an aggressive push to gain market share in the fast-growing business of e-commerce.”