FedEx to Raise Shipping Rates by 4.9%

Three little words have the power to convince an online consumer to make a purchase- “Free standard shipping.” The likes of Amazon and other retailers have made shoppers accustomed to avoiding paying shipping rates and ordering online with ease.

This luxury could see some changes in the new year. Truck driver shortage and tight capacity will likely force FedEx Ground and FedEx Home Delivery shipping rates up by an average of 4.9 percent, according to logistics and trucking news site, Transport Topics. The price hike comes into effect on 7 January 2019.

New Year, New Costs
FedEx believes the 5.9% rise in Freight rates at its two independent trucking units will enable it to improve customer service and offset operating costs. However, the pinch was a long time coming. The robust U.S. job market has helped pull more Americans out of unemployment, fueling an upswing in economic activity and freight demand.

However, driver supply has not been able to keep pace with rising freight demand. The U.S. truck driver population is aging, and younger…