UPS to Trim Fuel Surcharge, Link It to Index

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UPS said yesterday that it will lower its fuel surcharge for customers worldwide from 1.25 percent to 0.75 percent as it shifts to an index-based surcharge. FedEx Corp. and DHL both cut their surcharges earlier in the week.


The shift to an index system is intended to help UPS respond to fuel price fluctuations and help customers save when fuel prices decline.


The current surcharge, implemented in August 2000, is the industry's lowest at 1.25 percent. The reduction to 0.75 percent takes effect Dec. 10 and will last at least until Feb. 3.


"The index provides a prudent way for us to significantly reduce the current surcharge for customers as we continue to deal with fluctuations in fuel prices," said John Beystehner, senior vice president of marketing and worldwide sales for Atlanta-based UPS.


After Feb. 3, adjustments will take effect on the first Monday of each month and will be based on the U.S. Energy Department's On-Highway Diesel Fuel Prices. Customers can check on fuel index changes and get other information about the surcharge at UPS's Web site, www.ups.com.


Memphis-based FedEx dropped its fuel surcharge from 3 percent to 2 percent on Monday based on a new index for calculating fuel surcharges on U.S. domestic and U.S. outbound shipments. DHL reduced its fuel surcharge from 4 percent to 3 percent on Sunday.


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