UPS to reduce surcharges on certain international services

Here’s something one doesn’t see every day, at least these days: a reduction in delivery surcharges.

UPS Inc. said in a website post Monday that it will lower its surcharges on heavier-weighted shipments moving from Asian and South Pacific points to the U.S., effective Sunday. The reductions will affect shipments moving under UPS Worldwide Express Freight service, where palletized shipments weighing more than 150 pounds are typically delivered in one to three business days.

UPS (NYSE: UPS) will reduce surcharges to $1.70 per pound from $2.04 per pound on shipments that move from mainland China, Hong Kong and Macau. Surcharges on shipments moving from Australia and New Zealand, Vietnam, Malaysia, Japan, Korea, Thailand, Indonesia, Singapore, the Philippines and Taiwan, will be cut by more than half to 66 cents per pound from $1.34 per pound, UPS said.

Surcharges on four other air express services out of those markets will remain unchanged, UPS said. From China, Hong Kong and Macau, surcharges will remain at $1.36 per pound. From Australia, New Zealand and the other nine Asian nations, surcharges will stay at 65 cents per pound.

UPS did not respond to questions about the reasons behind the moves. However, it is believed that air cargo activity from Asia to North America has slowed in recent weeks.

UPS’ move comes just days after rival FedEx Corp. (NYSE: FDX) disclosed its peak-season surcharge schedule. The first of the surcharges, which cover parcels requiring special handling, kick in Sept. 5, about a month earlier than usual.

The base residential delivery surcharges, which will cover the bulk of FedEx’s peak traffic, will hit high-volume shippers hardest. According to consultancy Shipware LLC, lower-volume shippers will experience about a 10-cents-per-package increase over last year’s peak surcharges. Shippers at the top end of the volume spectrum, however, could see increases on the order of $1 per package, according to Shipware data.

The big-ticket surcharge hikes will take effect at lower volume thresholds, meaning that more of the big shipper volumes will be subject to the higher levies, according to Shipware.

Source: freightwaves - UPS to reduce surcharges on certain international services
Editor: Mark Solomon