Rising fuel surcharges are keeping parcel shipping rates elevated as FedEx and UPS revise their fee formulas to preserve surcharge revenue even when diesel prices ease. Even if diesel drops to $4 per gallon, shippers would still face a fuel surcharge above 24%, versus 21% under last year’s tables. TD Cowen/AFS Logistics said second-quarter average net fuel surcharge per package climbed 40% year over year, adding to higher costs as pricing tightened and discounts narrowed. Shippers are increasingly shifting volume to Amazon and regional carriers, with UPS share falling to 31.6% from 34% and alternative carriers’ share rising to 7.2% from 3.4%.

FedEx is selling its FedEx Supply Chain business to CMA CGM for $1.4B and, at the same time, signed an air-cargo cooperation memorandum with China Southern Airlines. The unit contributes less than 2% of FedEx’s consolidated annual revenue, employs about 10,000 people, and serves 130 customers. The transaction is subject to routine regulatory approvals. The move follows FedEx’s June 1 spinoff of FedEx Freight as it streamlines its portfolio and concentrates on higher-value verticals such as healthcare, automotive and aerospace.