FedEx to Raise Prices in Response to Surging Freight Demand, Tight Capacity

FedEx Truck
Mark Lennihan/Associated Press

FedEx Corp. will boost most prices by an average of 4.9% starting in January, more than double the expected rate of U.S. inflation next year, as freight demand surges.

Freight rates will rise 5.9%, higher than the company’s other businesses as a trucker shortage and strong U.S. industrial growth create a tight shipping market for large cargo. FedEx Express prices will increase 4.9% as will rates for home delivery and ground transportation, the shipper said in a statement Nov. 5.


Marc McAndrews/Associated Press

FedEx’s ability to boost prices at a higher rate than inflation is crucial for the company to expand profit margins. U.S. consumer prices are expected to rise 2.3% in 2019, according to the average expectation from 72 economists surveyed by Bloomberg.

The Memphis, Tenn.-based company’s increase, which takes effect Jan. 7, is comparable with last year’s average rise of 4.9%.

FedEx is No. 2 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 8 on the Transport Topics list of the Top 50 logistics companies in North America.