Resource Center/Article • 09/10/2025
2025 FedEx and UPS Peak Season Demand Surcharges: What Shippers Need to Know
FedEx and UPS have announced their 2025 peak season demand surcharges, with higher rates and dynamic residential delivery charges. Learn the key changes and how they’ll affect your shipping strategy.
Eric Pillow
Director of Operations Administration
Eric Pillow is the Director of Operations Administration at Green Mountain, a Parcel Spend Management (PSM) service provider for the largest shippers in North America. His contract management team delivers Green Mountain’s best-in-class rate audit and dispute resolution, and his customer service team serves both clients and carriers to expedite the freight bill payment process. […]
FedEx and UPS Peak Season Demand Surcharges at a Glance
FedEx 2025 Peak Season Surcharges
| Surcharge Name | Services Affected | Peak Surcharge Range Per Package | Effective Dates |
|---|---|---|---|
| Additional Handling Surcharge | U.S. Package Services, FedEx International Ground shipments | $8.25 to $10.90 | 9/29/25- 1/18/26 |
| Oversize Charge | U.S. Package Services, FedEx International Ground shipments | $90 to $108.50 | 9/29/25- 1/18/26 |
| Ground Unauthorized Package Charge | FedEx Ground, FedEx Home Delivery, and FedEx International Ground shipments | $490 to $545 | 9/29/25- 1/18/26 |
| Demand Surcharge | FedEx First Overnight, Priority Overnight, Standard Overnight, 2Day, 2Day A.M., Express Saver (excluding One Rate packages) | $1.05 to $2.10 | 10/27/25-1/18/26 |
| Demand Surcharge | FedEx Ground residential shipments, FedEx Home Delivery residential shipments | $0.40 to $0.65 | 10/27/25-1/18/26 |
| Demand Surcharge | FedEx Ground Economy Packages Services | $2.20 to $3.55 | 10/27/25-1/18/26 |
| Demand: Residential Delivery Charge* | Ground, Home Delivery, First Overnight, Priority Overnight, Standard Overnight, 2Day, 2Day A.M., Express Saver (excluding One Rate packages) | $1.55 to $8.75 | 10/27/25-1/18/26 |
Note: *Applies to enterprise-level customers who ship more than 20,000 residential and Ground Economy packages, with the price based on how much their volume deviates from their baseline shipping activity.
UPS 2025 Peak Season Surcharges
| Surcharge Name | Services Affected | Peak Surcharge Range Per Package | Effective Dates |
|---|---|---|---|
| Additional Handling | U.S. domestic, U.S. import, and U.S. export shipments | $8.25 to $10.80 | 9/28/25 to 1/17/26 |
| Large Package Surcharge | U.S. domestic, U.S. import, and U.S. export shipments | $90.50 to $107 | 9/28/25 to 1/17/26 |
| Over Maximum Limits | U.S. domestic, U.S. import, and U.S. export shipments | $485 to $540 | 9/28/25 to 1/17/26 |
| Demand Surcharge | UPS Ground Residential, Air, and Ground Saver packages | $0.40 to $2.05 | 10/26/25-1/17/26 |
| Demand Surcharge* | Certain UPS Ground Residential, Air Residential, Air Commercial, and Ground Saver packages for qualifying customers | $0.40 to $8.75 | 10/26/25-1/17/26 |
Note: *Applies in lieu of the previous Demand Surcharge to customers who are billed for more than 20,000 packages during any week following October 2024. The charge is based on how much their volume deviates from their baseline shipping activity.
Peak season demand surcharges are a familiar refrain with the major parcel carriers. On July 8, FedEx published its demand surcharges for U.S. packages, following a similar structure to last year but with higher charge amounts.
FedEx applies demand surcharges for Additional Handling, for Oversize, and for Ground Unauthorized packages. Here are three timeframes across which the charge amounts will vary:
- September 29 through November 23
- November 24 through December 28
- December 29 through January 18
In addition, FedEx has brought back the fixed, service-based demand surcharge it introduced last year. This includes separate fee structures for:
- All domestic FedEx Express services
- FedEx Ground residential and FedEx Home Delivery residential
- FedEx Ground Economy
These service-based charges have amounts that vary across three timeframes (like the size-based charges do), though they begin later in the season, starting on October 27.
Year-Over-Year Increases
- FedEx size-based demand charges: Increased in a range of 6.5% to 9.0%.
- FedEx service-based demand charges: The percentage cost increase varies significantly depending on the service classification. Express services increase by 5% throughout each of the three timeframes. FedEx Ground Residential and FedEx Home Delivery residential shipments have the highest price increase at 33.3% in the pre-holiday period, then an 18.2% increase in the Thanksgiving to Christmas timeframe, and back to a 33.3% increase during the post-Christmas period. Ground Economy rates increase by 15.8%, 12.7%, and 15.8% across the same periods.
Demand Residential Delivery Charge
FedEx is also reintroducing a Demand – Residential Delivery Charge, which adjusts dynamically each week, from October 27 through January 18. This applies to enterprise-level customers shipping more than 20,000 residential and FedEx Ground Economy packages (total U.S. domestic) during a calculation week. FedEx One Rate packages are excluded from all calculations.
Note that the Demand – Residential Delivery Charge applies in addition to the regular Residential Delivery Charge. Any contracted discounts or caps on the Residential Delivery Charge will not apply to the Demand version.
To determine the applicable charge for a week (the application week), the residential and FedEx Ground Economy package volume from two weeks prior (the calculation week) is divided by the average weekly residential and Ground Economy volume shipped June 2 through June 29, 2025. It is then multiplied by 100. The result is a “peaking factor.” The charge varies by service and across a range of peaking factors as shown in the table below.
- FedEx Ground and FedEx Home Delivery Services: The cost increase versus last year across all peaking factors range from 4.2% to 6.9%.
- FedEx Domestic Express Services: The percentage increases range from 5.6% to 7.7%.
UPS Demand Surcharges
UPS will again apply size- and handling-based demand surcharges, including Additional Handling, Large Package, and Over Maximum Limits. Rates vary over three timeframes that are similar to the FedEx periods. Rate increases compared to last year vary from 6.5% to 9.1%.
UPS has announced both a service-based demand surcharge and a volume-based demand surcharge, similar to last year, though with some changes in how they are applied.
Last year, the service-based demand surcharge applied to all UPS Air, UPS Ground Residential, and UPS Ground Saver (formerly UPS SurePost) packages, regardless of any volume consideration (i.e., regardless of the customer’s historical average weekly volume). Additionally, higher volume shippers were also subject to the volume-based demand surcharge on top of the service-based charge, but only on the incremental packages that exceeded 105% of the baseline average weekly volume within a given service level. (UPS defines a higher volume shipper as one who has shipped more than 20,000 packages during any week since the previous October.)
This year, the structure is different. The service-based surcharge still applies to all UPS Air, UPS Ground Residential, and UPS Ground Saver packages, but it will be levied against lower volume shippers only. For shippers that qualify as “higher volume,” they will only be subject to the volume-based demand surcharge.
It is important to note that the volume-based demand surcharge has baseline charge amounts for each service that matches the service-based demand surcharge. This means that shippers who may technically qualify as higher volume but are not currently exceeding their historical weekly baseline will still face a baseline charge.
Another significant change to the volume-based demand surcharge is its new application to all packages shipped within a week at the given service level to which it applies. Last year, the surcharge only applied to the incremental packages within a given service level that exceeded 105% of the baseline average weekly volume. The surcharges also now have three varying schedules of charges throughout peak season (whereas last year this surcharge had the same schedule of charges throughout peak season).
Price Changes
Several price changes have been implemented across the different schedules. During the Thanksgiving-to-Christmas period, the following changes occur:
- The price for UPS Next Day Air Commercial and All Other UPS Air Commercial across all volume tiers increases from $1.10 to $2.05.
- The price for UPS Ground Saver and UPS Ground Residential increases from $0.40 to $0.60 during that same period for the “0% to 105% of Baseline Volume” tier.
- The price for UPS Next Day Air Residential and All Other UPS Air Residential increases from $1.10 to $2.05 during that same period and only in the “0% to 105% of Baseline Volume” tier.
Below are the Higher Volume Shipper Tables published by UPS for the three time periods across peak season.
Navigating changing peak season charges requires more than just awareness, it takes strategy. That’s where Green Mountain comes in; we help large, complex shippers convert surcharge challenges into opportunities for smarter Parcel Spend Management.
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