With the FedEx 2025 general rate increase now in full effect, shipping costs are getting higher – again.
Both UPS and FedEx have announced their General Rate Increase (GRI) changes for 2025 to keep up with an increasing supply and demand chain. Their base rates for all shipping services are increasing by an average of 5.9%. But that doesn’t mean you can just take last year’s costs and multiply them by this figure to project your 2025 costs.
Many services exceed the stated average, and mid-year adjustments, along with hefty peak season surcharges, mean the true cost of shipping will be significantly higher. You’ll likely experience a higher increase in your base shipping costs – especially if you’re shipping large or heavy packages to distant zones. Surcharges have also risen sharply, making packages that are difficult to deliver significantly more expensive to ship.
In this article, we’ll highlight the new base rates for FedEx and UPS, cover the critical mid-year updates, detail the 2025-2026 peak season surcharges, and let you know what you can do to combat rising shipping costs.
Key Takeaways:
- Mid-year increases are the new norm: Both carriers introduced significant surcharge hikes and new fees outside of the initial January GRI.
- Peak Season is more expensive than ever: FedEx has announced its 2025-2026 Demand Surcharges, with the highest fees applying from late November to late December.
- Difficult-to-ship packages are targeted: Additional handling, oversize, and unauthorized package surcharges continue to rise dramatically, with increases of 25% or more.
- High zones cost more: UPS specifically increased surcharges for packages traveling to Zone 7 and higher, aligning its pricing more closely with FedEx.
- New fees beyond rates: Shippers must now account for new penalties like the UPS Shipping Charge Correction Audit Fee and a higher FedEx Late Payment Fee.
2025 Rate Changes: FedEx vs. UPS at a Glance
| Feature | FedEx | UPS |
| Average GRI | 5.9% | 5.9% |
| GRI Effective Date | January 6, 2025 | December 23, 2024 |
| Key Mid-Year Change | New Dimensional Rounding Rule (Rounds up any fraction of an inch) | New Shipping Charge Correction Audit Fee ($1.65/pkg or 12% of corrections) |
| Highest Oversize Surcharge | $305.00 (Residential, Zones 7-8) | $305.00 (Residential, Zones 7+) |
| Max Peak Surcharge | $545.00 (Ground Unauthorized) | TBD (Not yet announced as of 8/21/25) |
2025 Surcharge Comparison: FedEx vs. UPS
This table provides a direct comparison of the most common surcharges applied by both carriers for 2025.
| Surcharge Type | FedEx 2025 Rate | UPS 2025 Rate | Key Difference |
| Residential Surcharge (Ground) | $5.95 | $6.10 | FedEx is $0.15 cheaper |
| Residential Surcharge (Air/Express) | $6.55 | $6.55 | Identical |
| Delivery Area Surcharge (Ground Res) | $6.20 | $6.15 | UPS is $0.05 cheaper |
| Additional Handling (Weight, Zone 2) | $43.50 | $43.50 | Identical |
| Large Package (Commercial, Zone 2) | $205.00 | $205.00 | Identical |
| Large Package (Residential, Zone 2) | $240.00 | $240.00 | Identical |
Breaking Down the FedEx 2025 General Rate Increase
FedEx raised their shipping rates by an average of 5.9%, which started on January 6, 2025. However, like UPS, they have continued to make adjustments throughout the year.
Key Mid-Year 2025 FedEx Updates
FedEx implemented several rolling changes that impact total shipping costs:
- Increased Late Payment Fee (Effective July 14, 2025): The fee for past-due invoices was increased from 8% to 9.9%.
- New Dimensional Rounding Rule (Effective Aug. 18, 2025): FedEx now rounds any fraction of an inch up to the next whole inch when calculating dimensional weight, which can increase the billable weight of a package.
- New Pickup Pricing Structure (Effective Aug. 18, 2025): A new, more complex pricing model for parcel pickups in the U.S. and Canada was introduced.
FedEx Base Rate Increases by Service Type and Zone
| Service Type | Zone 2 | Zone 3-4 | Zone 5+ |
| Ground (Residential) | 5.53% | 5.97% | 6.73% |
| FedEx 2Day | 5.86% | 5.89% | 7.35% |
FedEx Surcharge Increases
The most significant impacts of the FedEx 2025 surcharge changes include:
- Handling & Oversize Fees: Surcharges for packages requiring additional handling or that are oversized have increased by over 26%.
- Delivery Area Surcharges: Fees for deliveries to remote or less-accessible residential areas have increased by as much as 8.8%.
- Mid-Year Adjustments: New rules for dimensional weight and higher fees for late payments add another layer of cost.
Residential Delivery and Delivery Area Surcharges
| Surcharge Type | 2024 Rate | 2025 Rate | Percentage Increase |
| Residential (Ground) | $5.55 | $5.95 | 7.2% |
| Residential (Express) | $6.15 | $6.55 | 6.5% |
| Delivery Area (Commercial) | $3.95 | $4.20 | 6.3% |
| Delivery Area (Ground Residential) | $5.70 | $6.20 | 8.8% |
| Delivery Area (Express Residential) | $5.85 | $6.20 | 6% |
Handling and Oversize Surcharges
| Charge Type | Category/Zone | 2024 | 2025 | Change | Percentage Increase |
| Additional Handling | |||||
| Weight (Zone 2) | $34.50 | $43.50 | $9.00 | 26.09% | |
| Weight (Zone 3-4) | $37.50 | $47.50 | $10.00 | 26.67% | |
| Weight (Zone 5+) | $41.50 | $52.75 | $11.25 | 27.11% | |
| Dimensions (Zone 2) | $22.00 | $28.00 | $6.00 | 27.27% | |
| Dimensions (Zone 3-4) | $24.50 | $31.00 | $6.50 | 26.53% | |
| Dimensions (Zone 5+) | $28.25 | $36.00 | $7.75 | 27.43% | |
| Packaging (Zone 2) | $19.50 | $25.00 | $5.50 | 28.21% | |
| Packaging (Zone 3-4) | $23.00 | $29.00 | $6.00 | 26.09% | |
| Packaging (Zone 5+) | $24.50 | $31.00 | $6.50 | 26.53% | |
| Large Package Surcharge | |||||
| Commercial (Zone 2) | $160.00 | $205.00 | $45.00 | 28.12% | |
| Commercial (Zone 3-4) | $175.00 | $225.00 | $50.00 | 28.57% | |
| Commercial (Zone 5+) | $197.50 | $250.00 | $52.50 | 26.58% | |
| Residential (Zone 2) | $190.00 | $240.00 | $50.00 | 26.32% | |
| Residential (Zone 3-4) | $205.00 | $260.00 | $55.00 | 26.83% | |
| Residential (Zone 5+) | $235.00 | $297.50 | $62.50 | 26.60% |
Navigating 2025-2026 Peak Season Surcharges
For shippers, the annual GRI is only part of the budget puzzle. Peak season, or “Demand,” surcharges add another significant layer of cost during the busiest shipping months.
FedEx Peak Season Surcharges (2025-2026)
On July 8, 2025, FedEx announced its peak season surcharges, which will be in effect from September 29, 2025, through January 18, 2026. The highest rates apply during the core holiday period.
| Surcharge Type | Early Peak (9/29 – 11/23) | Holiday Peak (11/24 – 12/28) | Extended Peak (12/29 – 1/18) |
| Additional Handling | $8.25 | $10.90 | $8.25 |
| Oversize Charge | $90.00 | $108.50 | $90.00 |
| Ground Unauthorized | $490.00 | $545.00 | $490.00 |
Note: As of August 21, 2025, UPS has not yet announced its peak season surcharges for the 2025-2026 season. Shippers should monitor for this announcement, which is expected soon.
How to Reduce Shipping Costs to Offset General Rate Increases
With rate increases affecting nearly every aspect of shipping, it’s important to develop strategies that can minimize their impact. Here are some tips you can use to lower your costs at any time, especially after carriers raise prices:
Freight Audits
Regularly auditing your freight shipping invoices is essential to catch overcharges or discrepancies that can inflate your costs. Carriers often make billing errors, and identifying these mistakes saves you money. By using automated tools, you streamline audits and reduce the risk of human error while lowering labor costs, making the process faster and more accurate.
Negotiate with Carriers
Leverage your unique shipping profile to negotiate better rates with carriers, especially if you handle high shipping volumes. Carriers frequently offer discounts based on specific shipping patterns, so leverage data and use strategic negotiation to make a strong case for lower, competitive rates. Regularly revisiting contracts and using competitor pricing as leverage can also lead to more favorable terms.
Carrier Diversification
Explore carrier diversification to unlock cost-saving opportunities. Don’t limit yourself to major carriers like UPS and FedEx; regional carriers and alternatives like DHL can be cost-effective for rural or bulky shipments. Many regional carriers specialize in last-mile delivery in specific areas, often at a lower cost than bigger carriers. Working with multiple carriers gives you flexibility, allowing you to adapt quickly to rate changes or service disruptions via multiple shipping lines.
Optimize Packaging
Optimize your packaging to reduce surcharges, especially with the new cubic volume calculations. Use appropriately sized boxes and avoid excessive packing materials that add unnecessary weight and bulk. Consider investing in software that suggests optimal packaging configurations based on your items or switching to lighter-weight materials to lower your dimensional weight charges.
Monitor Surcharge Changes
Stay on top of surcharge changes to control costs effectively. Surcharges often impact your shipping expenses more than general rate increases, so learn which surcharges frequently apply to your shipments. From there, you can adjust strategies, such as tweaking packaging or changing delivery times, to avoid or minimize extra fees.
How FreightOptics and GRITT Can Help
Navigating rate changes can get incredibly complicated – especially if you’re a high-volume shipper or sending a wide variety of package sizes, weights, and types across the country or internationally.
Despite announcing an average general rate increase of 5.9%, most shippers will see rate increases higher than that. Factors like your added accessorial needs, package dimensions and weight, and service level can drive those rates even higher, making it even harder to pinpoint how much your operational costs will increase.
We can both help you estimate your 2025 shipping costs and find ways to reduce them. As part of our Transportation Spend Management System (TSMS), FreightOptics, you’ll gain access to the GRITT tool, which uses your historical shipping data to identify the types of packages you send, the volume you sent, and how much they cost. Then, it applies the new GRI shipping rates and surcharges from your carriers to them, giving you an up-to-date estimate of your new costs to help you budget effectively for the new year.
Once you have your projected rates for 2025, FreightOptics’s business intelligence tools will help you find ways to reduce costs through freight and parcel audits, packaging optimization, optimizing your shipping routes, and other cost-saving improvements.
FAQ
What is the official FedEx 2025 general rate increase?
The official average increase is 5.9%, which went into effect on January 6, 2025. However, the actual cost increase for shippers is often higher due to significant hikes in surcharges for specific services, package types, and destinations.
What are the biggest surcharge increases for FedEx in 2025?
The most dramatic increases are for packages that are large, heavy, or require special handling. Additional Handling and Oversize Surcharges have risen by more than 25%. Furthermore, peak season surcharges add substantial costs, with the Ground Unauthorized fee reaching as high as $545 per package during the holiday peak.
How does the new dimensional rounding rule affect costs?
Effective August 18, 2025, FedEx rounds any measurement with a fraction up to the next whole inch. This can increase the calculated dimensional weight of a package, potentially pushing it into a higher price bracket and increasing the final shipping cost, even if the base rate hasn’t changed.
Are UPS rates also increasing in 2025?
Yes, UPS also announced an average rate increase of 5.9% and implemented significant mid-year surcharge increases on June 2, 2025, particularly for packages sent to higher zones (Zone 7+).
