Holiday Surcharges Climb Sharply for 2025; Tariffs Fail to Draw U.S. Fashion Production Back Home

As retailers and logistics firms brace for the 2025 holiday rush, all eyes are on peak season surcharges. Carriers including FedEx, UPS, USPS and Amazon’s own delivery arm are imposing higher temporary fees this year to contend with swelling volumes and operational costs. FedEx’s surcharges kicked off in September and escalate through late December, while Amazon Shipping’s surcharges run from October through mid-January and hit their peak around Thanksgiving and Christmas. Meanwhile, USPS is raising rates across Ground Advantage, Priority Mail and related services over the holiday stretch.

For shippers, these higher surcharges carry substantial risk. The additional fees penalize heavy, oversized or hard-to-handle parcels, squeezing margins especially for small or midsize businesses. Some carriers that avoid peak season pricing hope to position themselves as alternative choices, but loyalty and scale may favor incumbents. Negotiating surcharge relief or discounts is emerging as a key strategy to soften the blow. 

Despite escalating trade restrictions and promotional “buy-American” rhetoric, fashion brands are largely resisting a return to domestic sourcing according to Supply Chain Dive. The 2025 benchmarking study from the U.S. Fashion Industry Association reveals that only about 17 percent of brands intend to increase U.S. sourcing this year, and many cite constraints such as limited flexibility, narrower product diversity and lack of vertical integration in U.S. supply chains.

Tariff policies, though intended to tilt incentives, have not been enough to shift sourcing behavior. Brands continue to view domestic factories as less agile and more expensive compared to global counterparts, particularly in Asia where economies of scale and deeper supply networks remain dominant. In response to rising costs, many companies are instead doubling down on sourcing diversification - exploring emerging markets, expanding vendor bases and hedging exposure rather than turning to U.S. facilities.

For domestic manufacturers, the outlook remains murky unless policy moves beyond tariffs. Without investment in technological upgrades, capacity, and integration, U.S.-based suppliers risk being sidelined even as trade pressures intensify.