(Bloomberg) -- FedEx Corp. will boost most prices by an average of 4.9 percent starting in January, more than double the expected rate of U.S. inflation next year, as freight demand surges.
Freight rates will rise 5.9 percent, higher than the company's other businesses as a trucker shortage and strong U.S. industrial growth create a tight shipping market for large cargo. FedEx Express prices will increase 4.9 percent as will rates for home delivery and ground transportation, the shipper said in a statement Monday.
FedEx's ability to boost prices at a higher rate than inflation is crucial for the company to expand profit margins. U.S. consumer prices are expected to rise 2.3 percent in 2019, according to the average expectation from 72 economists surveyed by Bloomberg.
The Memphis, Tennessee-based company's increase, which takes effect Jan. 7, is comparable to last year's average rise of 4.9 percent.
To contact the reporter on this story: Thomas Black in Dallas at tblack@bloomberg.net
To contact the editors responsible for this story: Brendan Case at bcase4@bloomberg.net, Tony Robinson
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