The News
FedEx is raising its US list rates by an average of 5.9% on January 4, 2027. It is the fourth year in a row at the same number.
Shippers of small packages to homes will pay more than that. Our analysis of FedEx’s rate tables and fee sheet shows light packages rising faster than 5.9%. So do most of the fees on home delivery.
The increase also comes in three waves. Base rates and most surcharges move on January 4. Two new paper fees follow on January 18: $25 for any trade document filed on paper, and $5 for a handwritten airbill. Then, on February 1, FedEx changes the zones for “select” domestic ZIP-code pairs. It has not said which ones.
Why It Matters
A 2027 parcel budget built on 5.9% will come in low for anyone shipping small packages to homes. Take a three-pound box to a house. Its base rate rises 6.49%. The residential surcharge rises from $6.45 to $6.90. If the house is outside the metro area, the extended delivery-area charge also rises, from $8.80 to $9.60.
A contract discount does not shelter a shipper from this, because it is a percentage off the list price. When the list price rises, the discounted price rises with it. That makes timing matter: a discount agreed before January 4 comes off the old table, while one agreed after comes off the new one. The February zone change can also raise a lane’s cost without touching either.
UPS has not announced its 2027 rates yet. Last year it matched FedEx at 5.9%, announcing in November for a December 22 start.
Know More
By service, parcel auditor Loop found 2Day A.M. rising 6.65% and First Overnight 6.01%. Standard Overnight rises 5.16%, and Express Saver rises just 3.09%. Minimum charges rise 5.88% to 6.9%, which matters because the minimum is the floor a discount cannot go below.
The surcharges mostly rise faster than the base rate:
Additional handling: $46 to $49.50 by weight in zone 2, up 7.6%.
Residential delivery: $6.95 to $7.35 on Express, and $6.45 to $6.90 on Ground and Home Delivery.
Delivery area: residential $6.60 to $7.00, and extended residential $8.80 to $9.60, up 9.1%.
Oversize: $320 to $345 in zones 5 and 6, up 7.8%. Zone 2 is the one line at exactly 5.9%.
Unchanged: the dimensional divisor stays at 139, and the fuel table is not part of this round.
FedEx Freight is not part of this announcement. The LTL carrier has been a separate public company since June 1. It posted its own increase, effective January 8: 6.9% on its main tariffs, 7.9% on the FXF 1000 and 501 tariffs, and 8.9% on Mexico. So a shipper with a bundled parcel-and-LTL contract now faces two increases on two dates. FedEx Freight expects to finish unbundling those contracts by mid-2027.
Last Time
FedEx and UPS announced 5.9% for 2024, but shippers ended up paying less per package that year. Parcel volume was soft, so carriers cut deals to hold onto it. By the third quarter, the TD Cowen/AFS ground parcel index had fallen to 20.3% above its January 2018 baseline, the lowest since 2021. The index tracks what shippers actually pay per package, after discounts and surcharges. The biggest discounts went to the largest accounts, AFS’s Mingshu Bates told Supply Chain Dive at the time.
For 2026, the two carriers announced 5.9% again, but this time shippers paid much more. The same index reached 42.4% above baseline in the second quarter, a record for the third straight quarter. Fuel drove most of it: diesel rose about 10% in the first quarter, while ground fuel surcharges rose 26.7%. “Carriers have used the fuel surcharge as a potent revenue generator for years,” Bates said in AFS’s July release. On FedEx’s June call, chief customer officer Brie Carere said “the significant majority of our incremental profit from yield was due to base price increases.”
Peer Insights
Some shippers have moved volume off the national carriers in the past year. None has tied the move to a rate announcement, and the ones who have spoken about it describe a service decision as much as a price one.
EssilorLuxottica shifted volume to Veho. “I would not be here next year if I go to my CEO or COO and say, ‘Look, I saved $1 per delivery and we are [not going] to meet the customer expectation’,” SVP Massimo Sapone told Supply Chain Dive.
American Eagle Outfitters is a named Amazon Shipping parcel customer. Amazon charges no residential surcharge and no weekend fee. Loop puts the saving at up to $6 a package, though that is one vendor’s number with no published method.
Regional carriers more than doubled their volumes from 2024 to 2025, per AFS. UniUni’s domestic volume alone rose more than 1,000%. OnTrac is now piloting capacity pricing that either returns a label at the shipper’s target price or declines the job. The big carriers’ surcharge programs are ones where “the price only ever goes up,” OnTrac vice president Vijay Ramachandran told Supply Chain Dive. Wider testing starts in the first quarter.
What’s Next
UPS comes first, since it has matched FedEx’s headline every year since 2022. Then the zone change takes effect on February 1, and most shippers will see it first on the invoice. After that, AFS publishes its third-quarter index in October. It expects the index to ease to 38.7% with the season, which would end the run of records.
