UPS will adjust package shipping rates and implement a change in the fuel surcharge to take effect on Jan. 3, 2005.

Rates for UPS Ground, UPS Next Day Air, UPS 2nd Day Air, UPS 3 Day Select and U.S. international services will increase 2.9 percent. UPS Hundredweight Service, an alternative to that offered by less-than-truckload carriers, will increase by 5.9 percent, producing rates still half those of most major LTL carriers. There will be no changes to most UPS retail rates offered at nearly 3,600 locations of The UPS Store.

Beginning in January, UPS will reduce the fuel surcharge currently applied to UPS Next Day Air, UPS 2nd Day Air and UPS 3 Day Select and international services by setting a maximum cap of 9.5 percent. This surcharge will continue to be calculated from an index based on the average price for a gallon of kerosene-type jet fuel.

A fuel surcharge of 2 percent on UPS Ground, UPS Ground Hundredweight and UPS Standard To Canada will be applied that will fluctuate after January based on the U.S. Energy Department’s On-Highway Diesel price. The current fuel surcharge is described at UPS.com, and details regarding new calculations will be posted on the website on Dec. 1.

Other pricing changes include an increase of $0.25 for the delivery area surcharge on both residential and commercial services to more remote ZIP codes. The residential surcharge will increase $0.10 for UPS Ground services and $0.35 for UPS Next Day Air, UPS 2nd Day Air and UPS 3 Day Select. While protection against potential loss or damage is automatically provided up to $100 in value for each package, additional optional Declared Value protection will be $0.40 per $100, up to $50,000 per package, with a minimum charge of $1.20 for packages valued between $100.01 and $300.