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Package Carriers Alter Fuel Fees

The three main package carriers operating in the United States all took their fuel surcharges down a peg on air shipments in October, but they all pushed their ground package fuel fees higher.

FedEx Express and UPS both dropped their air surcharges by half a point to 16.5 percent for the coming month, but moved the ground shipment fees up half a point to 5.25 percent.

DHL is dropping its air package fuel surcharge to 18.5 percent from the 19 percent it charged in September, and raising its ground fee to 5.3 percent from 4.8 percent.

Although fuel costs have fallen sharply in recent weeks, the carriers all set their fees based on prices two months in the past - in this case using August prices. And when fuel costs did start declining, prices for jet fuel to power airplanes weakened earlier than diesel prices for trucks.

All three package firms use U.S. government pricing reports to guide their surcharges - a Gulf Coast report on kerosene-type jet fuel for the air side and a national average diesel price for ground - and use similar charts of trigger points detailing when a fuel price level moves the surcharge higher or lower.

 

 


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