Expect higher integrator costs in 2008

Pretty much every company out there conducts business with an integrator for their everyday express or ground package needs, whether it’s UPS, FedEx, or DHL. Via Air Cargo World, rising fuel prices and declining yields are contributing to an expected rise in integrator fees come 2008:

FedEx Express said it would raise its net average shipping rate next year by 4.9 percent, down from an initial 6.9 percent increase due to an offset of 2 percent in the fuel surcharge. Rates and surcharges for FedEx Ground will also increase next year. The changes were to be announced at by end of 2007.

The increase for air was the largest FedEx has announced since 2001, although it matches UPS’s announced 4.9 percent air express rate hike last year, when FedEx said it’s rates would go up 3.5 percent.

Days later, UPS followed suit, announcing new list rates for 2008, including a net average of 4.9 percent on all air express and U.S. origin international shipments. The rate hikes include an average 4.9 percent increase for UPS Ground and Ground Hundredweight shipments. The new rates take effect on Dec. 31, 2007.

A clearer picture of the future could be seen in coming weeks when the major integrators release the accessorial charges.