Each year, shipments from both individuals and businesses spike during the holidays. That surge puts pressure on carriers, who respond by making adjustments to their delivery framework. Pickup schedules may shift, capacity gets stretched, and most importantly, rates go up.
To stay profitable or maximize profits, UPS, FedEx, and others impose “peak” surcharges, now often referred to as “demand” surcharges. The result is heavier shipping invoices through the holiday rush. Even the U.S. Postal Service has announced proposed temporary “price changes” (read: increases) in the past. ¹
Carriers say these surcharges are necessary to ‘continue providing our customers with the best possible service.’
For instance, UPS CEO Carol Tomé explained their 2024 holiday rate hikes by noting they were to experience the tightest peak season since 2019. With only 17 days between Thanksgiving and Christmas, and the single highest-volume day in the company’s history that December, she said added costs were unavoidable: “When you have that kind of volume flowing through your network, you have to charge to service them well because you have to hire people and lease aircraft and delivery vehicles so on and so forth.” ²
FedEx EVP and Chief Customer Officer Brie Carere struck a similar note in a June 2024 earnings call: “The team has done a really good job in getting the increase we need to deliver an amazing peak where we do have to expand capacity.” ³
Of course, “best possible service” doesn’t necessarily mean guaranteed deliveries, as shippers have learned over the past five years.
Here's What You'll Learn Today
Important FedEx and UPS Peak season surcharge effective dates for 2025-2026
Peak surcharge details
Who is most likely to be impacted by peak surcharges
Planning for Peak season
Ship dates for Christmas Day delivery
How to mitigate package surcharges
Peak vs Demand Surcharges - What’s the difference?
In simple terms, peak refers to the predictable shipping rushes each year—usually around the holidays—when volumes climb sharply. Demand, on the other hand, means any period when carriers face higher-than-usual shipping requests. In practice, unless there’s some extraordinary event driving demand, these periods often line up. That’s why the two terms are often used interchangeably.
UPS makes this explicit in its 2025 Rate and Service Guide, where it states that the term “Demand Surcharges” includes both “peak/demand surcharges” and “peak surcharges,” and that the terms are interchangeable. FedEx has taken it a step further: as of September 4, 2023, they dropped the word “peak” altogether and now only use “demand” to describe these surcharges. ⁴
Why the name change? Could it be that carriers are leaving room to tack on more surcharges? By using “demand” instead of “peak,” they can define their own high-demand periods, rather than sticking only to the well-known, industry-wide peak season dates.
Latest Announcements on FedEx and UPS Peak Surcharges
Recently, on August 28, 2025, UPS updated their Demand Surcharges, getting shippers ready to pay more for the privilege of using its network during peak season. FedEx made its update earlier, on July 8, 2025.
Shippers should not dismiss these surcharges or resign themselves to the fate of higher fees. They must study them closely, understand the potential impact, and develop the best strategies for mitigation.
Peak Season Timelines for 2025-2026
The peak shipping period for 2025–2026, as in most years, falls during the holiday season, running from late October through early January. However, UPS and FedEx don’t wait that long. Their demand surcharges kick in at the end of September and extend into mid-January.
2025-2026 UPS & FedEx Peak Season Demand Surcharges
FedEx and UPS Demand Surcharge Comparison
The following is a side-by-side comparison of the UPS and FedEx demand surcharges that apply to the services shown on the outlined dates (does not apply to ground commercial):
FedEx Peak Season Size and/or Weight Related Surcharges
FedEx Demand — Residential Delivery Charge
This surcharge works differently from most others. Instead of a flat fee, it’s dynamic, changing week by week based on the customer’s shipping volume.
Who It Applies To
Enterprise-level customers who ship more than 20,000 residential* and FedEx Ground Economy packages (U.S. domestic) in a given “calculation week.”
Important to Note: The Demand – Residential Delivery Charge is applied in addition to the standard Residential Delivery Charge, not as a replacement. That means:
Both surcharges may apply to the same shipment.
Any discounts or caps in your contract for the standard Residential Delivery Charge do not apply to the Demand – Residential Delivery Charge.
How It Works
The process involves two parts: a calculation week and an application week.
Step 1: During the calculation week, FedEx measures how many residential and Ground Economy packages you shipped.
If that week has a holiday, FedEx adjusts your volume to account for the one less operating day. Example: say you ship 17,000 packages in a 4-day week (because of a holiday). FedEx will normalize it like this:
[17,000 5 (days)] / [4 (days)] = 21,250
So even though you only shipped 17,000, they treat it as 21,250 for that week, which means instead of staying under the threshold, you now get hit with the surcharge.
Step 2: A peaking factor (PF) is then calculated using this formula:
PF = [(No. of Residential* and FedEx Ground Economy packages shipped during calculation week) / (Weekly average Residential* and FedEx Ground Economy packages shipped between June 2, 2025-June 29, 2025)] X100
Step 3: The peaking factor, shown as a percentage in the table below, is used to determine the surcharge amount for the application week, which comes two weeks later. The amount charged depends on which FedEx service was used.
*FedEx One Rate packages are excluded.
In the 2025-2026 peak season, the FedEx Demand — Residential Delivery Charge can range from $1.55 per package up to $8.75 per package.
To get more details on FedEx peak surcharges, visit FedEx.com here.
UPS Peak Season Size and/or Weight Related Surcharges
UPS Demand Surcharge
This demand surcharge applies to all UPS Air, UPS Ground Residential, and UPS Ground Saver (formerly UPS SurePost) shipments, as outlined below.
For UPS customers billed for more than 20,000 packages in any week after October 2024, the standard surcharge rates don’t apply. Instead, they’re charged under the “Higher Volume Shipper” demand surcharge rates in the tables below.
These higher-volume surcharges are applied weekly. Each week during the demand period, UPS calculates the number of packages a customer shipped as a percentage of their baseline weekly average.
% of Baseline Volume= [(Weekly shipping volume) / (Baseline* volume)] X100
(*Baseline volume is the shipper’s average weekly shipments for June 2025 (June 1–28). If their average volume from Aug 31–Sept 27, 2025 is less than 80% of that June average, then the Aug–Sept average becomes the baseline instead.)
That percentage determines which surcharge amount from the “Higher Volume Shipper” tables applies—and that amount is charged on every package for that service level that week.
With this UPS surcharge, the percentage is calculated separately for each service level and applied only to that service to get the surcharge amount. (This is unlike the FedEx Demand – Residential Delivery Charge, where the peaking factor is based only on Residential and Ground Economy shipments and then applied across all services to calculate their surcharge amounts.)
To get more details on UPS peak surcharges, see UPS.com.
Strategies & Planning for Peak/Demand Surcharges
To control and reduce shipping costs during the holiday peak season, preparation is key. Regardless of your shipping carrier:
Create a free Lojistic account to verify contracted rates, surcharges, and fees.
Plan ahead by meeting with carrier reps to discuss logistics like late pickups and capacity needs.
Initiate early shopping campaigns to stimulate pre-holiday buying.
Consider diversifying with additional regional and national carriers.
Opt for multiple fulfillment centers to cut down on transit times and zone density.
Scrutinize peak season surcharges and other controllable costs, such as address corrections and third-party billing fees, that can eat into your margins.
Stock up on essential shipping supplies in advance to avoid material scarcity and inflated prices.
Lojistic offers year-round cost reduction technology and verifies invoice accuracy and on-time delivery, especially important given the high volume of packages during the holiday season. For more info, contact Lojistic at 800.783.5753 or hello@lojistic.com.
Key Statistics: Looking at Past Peak Shipping Seasons
One of the best ways to prep for peak shipping season is to look back at your shipping data from years past. With Lojistic it's easy to compare time periods to see your peak season costs vs typical 'non-peak' costs AND year-over-year peak season costs. Just use Compare Mode to help illuminate what went well...and where there's room for improvement, including:
Information like total shipping costs
Surcharge impact
Total number of shipments
Shipments per carrier
Shipments per service level
Billed weight vs actual weight
Look back, learn, and move forward. With Lojistic, you're equipped to make the best possible decisions during peak season and beyond. And if you tap into the Lojistic API, you can integrate all your shipping data with the other systems you're already using to run your business. The Lojistic API is free and unlimited.
Check our video on key data points to look out for, watch it on our YouTube page.
Mitigate Peak Season Surcharges with Lojistic
There are plenty of reasons to use our platform for managing surcharges: automatic carrier connections, great pricing, and everything unlimited—users, carriers, API, data, and more. Plus, with features like Spend Overview, you’ll be able to easily compare your peak vs non-peak shipping characteristics.
And if you need additional help understanding your cost reduction opportunities, our support team is here to help. Give us a call at 800.783.5753, ask us a question here, or send us an email at hello@lojistic.com.
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Author
Bryan Van Suchtelen
Bryan Van Suchtelen
Corporate Director of Rate Services
With more than 34 years of parcel experience, Bryan Van Suchtelen is the Corporate Director of Rate Services at Lojistic, one of the nation’s top logistics and transportation cost management companies.
Prior to joining Lojistic in 2015, Bryan enjoyed a 26-year career with UPS where his roles included Pricing, Field Sales and Director-level Sales Management of some of UPS’s largest customers.
At Lojistic, Bryan leverages his wealth of experience/expertise to identify and execute supply chain cost management solutions for parcel shippers of all sizes. Bryan has helped his customers reduce their shipping spend by tens of millions of dollars.