FedEx Hikes Ground Rates
FedEx
(FDX)
said Monday it will raise ground delivery rates next year by 4.9%, matching the increase that rivals
UPS
(UPS)
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and DHL had previously announced.
The FedEx increase "confirms our view of a detente in the parcel industry," wrote analyst Scott Flower of Banc of America Securities in a research report. "Pricing
is firming and perhaps accelerating slightly, albeit from a low base, though selected pockets of competition may exist on an account-by-account basis," he said.
Banc of America Securities has financial relationships with both FedEx and UPS.
Last month, Memphis-based FedEx said it would boost air express rates by 3.5%, which includes a 5.5% increase in list rates and a 2% reduction in fuel surcharge. UPS subsequently raised air express rates by 4.9%, but said that despite the higher percentage increase, its air rates remain lower than those at FedEx.
DHL, the No. 3 overnight package carrier, last week announced a ground rate increase as well as a 3.9% hike in air express rates. The three carriers' new rates take effect Jan. 1.
