UPS says 2011 rates will rise 4.9 percent

AP News
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Posted: Nov 01, 2010 5:03 PM
UPS says 2011 rates will rise 4.9 percent

United Parcel Service Inc. says rates for next year are going up 4.9 percent for ground and air-express shipments.

UPS, the world's largest package-delivery company, said Monday that the new rates will take effect Jan. 3.

Imports of electronics products from Asia, including the Apple iPhone and iPad, have boosted UPS this year and helped offset slow growth in the U.S. The company reported last week that third-quarter net income rose 81 percent compared with the same period in 2009.

But officials told The Associated Press at the time they were not optimistic about a rapid economic recovery.

As the economy grinds away, consumers have continued to trade down _ opting for slower but less expensive shipping options. Businesses, however, are often paying higher rates for faster delivery, according to UPS officials. That's helped UPS make more money per package than it did last year.

Last month, UPS slightly increased its forecast of 2010 adjusted earnings and said it would hire 50,000 temporary employees for the holiday rush _ about the same as last year.

UPS said Monday that 2011 ground rates will rise 5.9 percent but be partly offset by a 1 percent reduction in the fuel surcharge.

It's a similar story with air-express and international shipments, with 6.9 percent base rate increases and 2 percent cuts in fuel surcharges.

Shares of the Atlanta company were unchanged, ending regular trading Monday at $67.34.