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FedEx Corp. is joining a rush to apply extra holiday fees on high-volume shippers as couriers brace for a new jump in residential deliveries during the year-end peak season.
Surcharges on regular shipments to homes will range from $1 to $5 from Nov. 2 to Jan. 17, FedEx said on its website Aug. 18. That marks the first time since 2016 that the company has applied special peak-season fees, and the move follows similar efforts by UPS Inc. and the U.S. Postal Service.
The U.S. Postal Service—an organization older than the country—is getting more press than it wants as the fight over mail-in ballots and the organization’s funding heats up.
The post office is a secret giant. If it were publicly traded it would be worth, very roughly, $50 billion, making it the third largest non-rail logistics company by value in America. It generates about $71 billion in annual sales in 2019, just short of UPS’s $76 billion in sales and a touch higher than FedEx’s $69 billion.
The USPS has a funding problem, however. Even though the parcel business is booming, the marketing mail business is being badly hurt by the downturn. If the Postal Service were a publicly traded company, it would simply exit the mail business. It can’t, for obvious reasons.
United Parcel Service and FedEx on Friday shot down social media calls that they step in to deliver mail-in ballots from the U.S. Postal Service, which is warning states of potentially “significant” delays.
“State ballots must be postmarked to be considered valid and only the USPS has lawful postmarking status. Therefore UPS, FedEx and other private parties cannot technically be involved in shipping ballots,” UPS told Reuters in a statement.
“FedEx does accept individual ballots, and we advise that customers planning to return their ballots via FedEx should closely review their state’s guidelines on absentee voting and deadlines for ballots or related election documents,” FedEx said.
The stock value of package delivery companies UPS and FedEx jumped Thursday after President Trump said he opposed more funding for the U.S. Postal Service over mail-in voting.
Stocks for UPS and FedEx each shot up by more than $3 shortly after Trump’s comments about not wanting to give additional funding to the Postal Service. The increase on Thursday represents a 1.5% to 2% jump in stock value for each company. Both companies have also had a stock spike since the end of July.
“It’s basic competition 101. If your competitor, a state competitor, is hurt, it’s an advantage for private companies in the same industry,” said Tim Wu, an antitrust professor at Columbia University. “It’s absolutely a boon for UPS and FedEx. It’s doubtlessly helpful to them.”
Online orders poured into Foot Locker Inc. in March, propping up business after the coronavirus pandemic forced the sneaker seller to close nearly all of its 3,000-plus stores.
By the end of June, Foot Locker had received notice from its longtime carrier, United Parcel Service Inc., that it would face a hefty rate increase on some of its shipping contracts, people familiar with the matter said.
Executives balked and are exploring moving that business to FedEx Corp. or other carriers, a person familiar with the matter said. A Foot Locker spokeswoman declined to comment.