Fleet Management

UPS Freight Expanding Availability of Density-Based Pricing

October 15, 2014

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CORRECTED -- UPS Freight is expanding its Density-Based Rating (also known as dimensional weight pricing) pricing option to all its customers.

The less-than-truckload carrier will make density-based rates, also known as dimensional weight pricing, available as an option to all customers, rather than just traditional method of pricing LTL shipments based on a commodity classification code established many decades ago, according to DC Velocity.

There are no current plans to make density-based pricing mandatory.

Density-Based Rating currently is available to a large portion of the UPS Freight customer base. The company began a pilot program with the new pricing option for some customers about a year ago and in May, started making it available to more of the customer base.

"We continue to slowly and methodically expand our offering of this optional pricing structure, and anticipate that Density-Based Rating will be available to all UPS Freight customers who want it and have the technology to support it by the end of this year," a UPS spokesperson told HDT/Truckinginfo.

According to the story, the LTL industry is moving very slowly to shift its pricing to a formula based on a shipment's cubic dimensions rather than how it is classified by the National Motor Freight Traffic Association, a nonprofit group that maintains the code for traditional pricing.

Rivals FedEx Freight, as well as FedEx’s parcel delivery business, along with LTL carrier YRC Freight are also testing the new pricing system, according to the Journal of Commerce.

Read more about it from DC Velocity and JOC.

Corrected 2:35 p.m. EDT to indicate that this pricing option is not new, but rather an expansion of an existing program to more customers.

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