Holiday bonus: UPS unveils extra seasonal delivery fee

United Parcel Service will place its first holiday-season surcharges on U.S. packages, as the world’s largest package-delivery company seeks to defray a surge in year-end costs.

A fee of 27 cents a package will be levied on deliveries by the residential ground network on certain weeks in November and December, UPS said in a statement. Parcels sent to homes using next-day air will see an additional charge of 81 cents in the week ending Dec. 23, while shipments through the deferred network will incur a per-package fee

of 97 cents.

The new charges are needed to help pay for additional holiday capacity in airplanes and trucks purchased at short-term premium rates, as well as to offset the cost of temporary facilities and seasonal help. UPS hired about 95,000 temporary workers during last year’s holiday season.

“It’s about having the customers who generate those extra costs pay for it,” said Satish Jindel, founder of SJ Consulting Group in Sewickley, Pennsylvania. He said Fedex Corp. is likely to follow suit on peak-season fees.

Fedex Executive Vice President Rajesh Subramaniam said Tuesday that the company is looking at several options around surcharges but hasn’t made any decisions.

UPS should have adopted the approach in 2014, following a disastrous 2013 holiday season in which it failed to deliver thousands of packages ahead of Christmas, Jindel said. The biggest shippers make their own contracts with Atlanta-based UPS and wouldn’t necessarily pay the peak surcharge, but everyone else can get around it by avoiding the busiest period, Jindel said.

The new fees will pertain to certain weeks starting on Nov. 19, with no charge for residential groundshipped packages during the twoweek period from Dec. 3 to Dec.

16. All residential packages sent by air or ground will incur a surcharge in the week ending Dec. 23. UPS also will introduce a levy on large packages and items that exceed size limits during the holiday season, the company said.