Never one to be left behind, UPS has announced its peak season 2023 rate hikes. If these price increases look familiar, it's likely because they’re nearly identical to UPS’s chief competitor, FedEx. With the leading players in the parcel game having announced their rate hikes, it’s wait-and-see for peak season 2023: Will expert predictions of low volume bear out, leaving carriers with little to do this peak season? Or will retailers attempt to hurry excess inventory out the door, causing an unexpected increase in shipping?
But it’s not all dueling giants and peak season predictions. UPS has received permission to operate drones beyond the line of sight from the FAA, paving the way for ongoing testing and flights. Dave Clark is out at Flexport, leaving Founder Ryan Petersen at the helm of the freight brokerage and logistics solutions provider. Here’s what’s making news in the industry that’s always moving.
Delivery giant UPS has announced its peak season surcharges for 2023. While the fees mostly mirror those of the company’s closest competitors, some of UPS’s surcharges target only shippers that shipped over 1,000 packages after the week of February 20. Some highlights of the UPS surcharges:
UPS’s 5.9% rate increase matches that of chief rival FedEx, which announced its increase the previous week. The increase is noticeably lower than the 6.9% hike in 2022.
In a significant step forward for UPS’s drone delivery ambitions, the carrier’s drone division, Flight Forward, received approval from the Federal Aviation Administration (FAA) to operate drones beyond line of sight on Sept. 6, per an FAA press release. The FAA’s decision allowed UPS to test the efficacy of parcel delivery using its Matternet M2 drones without stationing observers along its path to maintain a line of sight on the drone.
“We are thrilled by this approval from the FAA and know this will play a significant role in the scaling of drone delivery services throughout the United States,” Andreas Raptopoulos, founder and CEO of Matternet, said in a statement obtained by Supply Chain Dive. “We are excited to continue our partnership with UPSFF to grow our services and enable drone delivery at scale.”
As part of the carrier’s continued push into South America, DHL began shipping from Miami to South America the week of Aug. 27. The company plans to fly cargo from Miami International Airport to Buenos Aires’ Ezeiza International Airport, with flights departing Miami six days a week.
"DHL remains steadfast and bullish in its belief in the power of trade and how it continues to drive local economies, build prosperity, and fuel entrepreneurship, " Mike Parra, CEO of DHL Express Americas, said in a Sept. 5 press release. "That's why we continually invest in and strengthen our global network. The introduction of this new flight to Argentina reinforces our unwavering commitment to global trade by delivering faster and more efficient shipping and logistics solutions, and addressing the growing demand in the region."
In March, the U.S. Securities and Exchange Commission (SEC) proposed new rules requiring publicly traded companies to track and report on carbon emissions generated by their supply chains. As a result, the more than 7,000 publicly traded companies covered under the SEC proposal are under renewed pressure to find reliable emissions-measuring methods — and are turning to technology to do so.
In a recent interview, Margarita Kruyff, Environmental Services Director at Ryder, told Transport Times, “Emissions reporting is a very rapidly evolving area. Expertise is critical. Without it, a tool is just a tool. The customer has to define what is applicable or not … we [then] lean on globally recognized standards to help us think through how to meet reporting needs and define what data, tools, and metrics [the customer] should be considering.”
Following a challenging year as CEO, Dave Clark has stepped down from his position at the top of Flexport, a leading freight forwarder and logistics solutions company. Flexport’s founder, Ryan Petersen, will replace Clark.
“Today, Ryan and I discussed his desire to return to focusing on growth in the core freight business,” Clark said in a post on X, “In light of that, I feel that he is best suited to lead the company in that direction. As such, I will be resigning my position at Flexport.”
While few specifics are known, a recent interview with Petersen reveals some stresses within the company: “A big reason this change needed to happen is the CEO needs to be out there meeting customers, constantly traveling and seeing them in person wherever, whenever, multiple days a week,” Petersen told FreightWaves. “The culture of Flexport is [based on] seeing the world through our customers’ eyes and solving their problems. As the board started to see that waning … we took immediate action.”
Peak season 2023 will go by a different set of rules than peak seasons past. The unpredictability of demand has become a defining feature of the retail landscape, warns Howard Meitner, Managing Director at Carl Marks Advisors. But rather than attempt to play by old rules, Meitner argues that it’s time for businesses to listen to consumers to upgrade their peak season retail performance.
“Companies that pivot to suit changing consumer habits will do well. Some are going to do very well, and others are going to really struggle,” Meitner told Helen Atkinson, Managing Editor at SupplyChainBrain. “You have to look at each company individually to see who are the winners and who are the losers.”
According to a recent report from the United Nations, governments are failing to cut emissions quickly enough to meet the goals of the Paris Agreement designed to prevent the worst effects of climate change. Per a SupplyChainBrain article, “Emissions are still rising, however, and there is a gap of 20 to 23 gigatonnes of CO2 between the cuts needed by 2030.”
Regardless of what peak season 2023 offers shippers, having the assets needed to keep pace with the competition is vital. By partnering with Intelligent Audit, shippers can access the data-driven supply chain resources they need to stand out in a crowded transportation environment. Such tools include:
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Read on to learn how UPS achieved impressive growth in YoY consolidated revenue (up 4.2%) and operating profit (6%) in Q3 2022.