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UPS, following FedEx lead, shrinks threshold of dimensional pricing on parcel shipments | DC Velocity

Company drops divisor to 139 from 166, subjecting more parcels to costlier price formula; shipments measuring 1 cubic foot or less not affected.

UPS Inc. said late Friday it will expand the volume of parcels that are priced on their dimensions rather than just their weight, a move that follows on the heels of a similar move by its rival, FedEx Corp., and which will subject a large number of parcels to a costlier pricing formula.

Atlanta-based UPS, the nation’s largest transportation company, said that effective Jan. 8, it will reset the divisor used to calculate dimensional prices on its parcels to 139 from 166. The change will apply to all parcels measuring more than 1 cubic foot and moving within the U.S. or into the U.S. from Canada.

Parcels measuring 1 cubic foot or less will still be priced using the current divisor of 166, UPS said in an update to its 2017 service guide. It is unclear how many UPS shipments fall at or beneath the 1-cubic-foot threshold.

UPS currently determines a package’s dimensions by multiplying its length, width, and height in cubic inches and dividing by 166. For example, a parcel measuring 3 cubic feet—or 5,184 cubic inches—would yield a dimensional weight equal to a 31-pound shipment, even though its actual weight could be much less. Using the new divisor of 139, that same parcel would be priced equal to that of a 37-pound shipment. The shipper pays the higher of the parcel’s dimensional or actual weight. Any applicable fuel surcharges would apply to the higher dimensional-weight rate, thus further increasing a shipper’s costs.

“Unlike FedEx, UPS is keeping the divisor at 166 for U.S. domestic air and ground packages that are 1 cubic foot and smaller,” said Kyle Peterson, a UPS spokesman. “This will create a published-rate price advantage for UPS customers for a significant number of packages.”

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UPS, following FedEx lead, shrinks threshold of dimensional pricing on parcel shipments – DC Velocity.

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