FedEx Implements New Surcharges Amid Surge in Online Demand
FedEx will join UPS in imposing surcharges on domestic shipments. FedEx announced that starting June 8, 2020 they will be adding temporary peak surcharges and fees to help relieve the current shipping strain.
These fees will likely have an impact on some of the largest shippers, most of whom experienced a high volume of orders over the past several weeks. FedEx’s announcement may cause shippers to either absorb most of the costs themselves, or raise consumer prices.
“The peak surcharges will help us manage the demand while maintaining strong levels of service for our customers”, a FedEx spokeswoman told The Wall Street Journal. As COVID-19 continues to impact the shipping industry, FedEx and others must continue to adapt.
Amazon Adds 12 New Planes to Air Cargo Fleet
Amazon announced Wednesday that twelve new planes will be added to its air-cargo fleet. By doing so, industry leaders predict they will eventually begin to absorb revenue from UPS, FedEx, and the United States Postal Service.
Following the news, Amazon Global Air Vice President Sarah Rhoads told Business Insider that the expansion is critical ensuring fast delivery for their customers. According to Rhoads, “During a time when so many of our customers rely on us to get what they need without leaving their homes, expanding our dedicated air network ensures we have the capacity to deliver what our customers want: great selection, low prices and fast shipping speeds.”
11 of the new planes are said to be delivered in 2021, after one of the 12 was already delivered. Since starting to in-house its air cargo operations in 2014, Amazon has acquired 81 planes.
Amazon will still have some work to complete, as they are still far behind UPS with a fleet of 679 planes and FedEx with 564. However, Amazon sales are still predicted to boom by 2022, with an expected increase in package volume by 6.4 billion, according to a Morgan Stanley Analysis.