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UPS Fuel Surcharges

By Last updated on: January 21, 2021

Estimated reading time: 3 minutes

What are UPS Fuel Surcharges

Did you know that each UPS package you send has a published rate and an additional fuel surcharge not included in the published rate? This applies to all ground, and express packages yet does not apply to UPS Simple Rate shipments. Also, fuel surcharges apply to all value-added services associated with the pickup, transport, and delivery. 

If your company ships UPS, you understand the impact UPS fuel surcharge has on shipping expenses. The calculation is a percentage of the base rate and adds to the charges of each package. As a result, it covers additional fuel costs and keeps UPS profitable, even when the price of fuel rises.

2020 Fuel Surcharge Increases

UPS fuel surcharge rates will see a further increase in 2020. Starting March 2nd, the surcharges will increase by 0.5% for ground and export air packages. The increase will be 0.25% for domestic air packages and 1.5% as import air packages.

UPS Fuel Surcharge Calculations

Ground and Mail Innovations: UPS uses an index-based surcharge that adjusts Monday each week. The basis for the fee is the National U.S. Average On-Highway Diesel Fuel Price. This applies for the week that is two weeks before the adjustment. If the fuel surcharge falls outside the published ranges, UPS will update the tables accordingly. For instance, the surcharge for the week of March 9, 2020, is based on the diesel fuel price for the week of February 24th.

UPS Ground Fuel Surcharge

Domestic Air fuel surcharge: UPS uses an index-based surcharge that adjusts on Monday of each week. The basis for fuel surcharge the U.S. Gulf Coast price for kerosene-type jet fuel. Accordingly, this applies for the week that is two weeks before the adjustment. These charts are taken from UPS.com. We are not associated with UPS or FedEx.

UPS Air Fuel Surcharge

How do I lower fuel costs? 

Every single package is subject to a fuel surcharge, all shippers are impacted by fuel surcharge. As a result, the fuel surcharge is the most common surcharge for all Refund Retriever clients. In short, here are a few tips to lower UPS fuel surcharges:

  • Negotiate better service agreement terms on discounts and surcharges. 
  • Negotiate UPS fuel surcharge incentives on the agreement.
  • (10 – 50% discount on fuel surcharge)
  • Reduce the frequency of surcharges on which fuel surcharge applies

Refund Retriever will help lower your transportation charges with UPS and FedEx. Chiefly our reports and analytics identify the total amount spent on fuel surcharges each year. Additionally, our free contract analysis will start carrier agreement negotiations off with the best information. In summary, it is possible for UPS to decrease or even eliminate this charge.

What services are affected by fuel surcharges?  

Fuel surcharges apply to domestic and international transportation charges. Similarly, this charge will apply to all value-added services associated with the pickup, transport, and delivery. This includes

  • Delivery Charges and Pickup Charges
  • Remote/Extended Delivery and Pickup Charges
  • Residential Surcharge
  • Return Services with Pickup
  • Saturday Delivery and Saturday Pickup
  • Signature Services
  • Additional Handling, Large Package and Over Maximum Limits
  • Oversize Pallet Handling Surcharge and Peak Surcharges
  • And others

Consequently, UPS daily rates differ from UPS retail rates. This charge will not apply to UPS Ground packages when subject to UPS retail rates. In conclusion, when your company is looking to reduce the impact of UPS fuel surcharge, contact Refund Retriever today.

Brian Gibbs

Author Brian Gibbs

More posts by Brian Gibbs

Brian Gibbs | President of Refund Retriever

Brian Gibbs founded Refund Retriever in 2006 while running his first eBay-based business and seeing the shortcomings of other shipment auditing companies. Refund Retriever's primary focus is FedEx and UPS parcel invoice auditing. After graduating from Texas A&M University in 2001, he graduated from the University of Houston in 2004 with a JD and MBA. Gibbs has been featured in Forbes, Entrepreneur, and other publications discussing parcel auditing, shipping, e-commerce, and more. Learn more at www.refundretriever.com or call (800) 441-8085 for more information.

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