Fuel Surcharge Application Date Clarified

05. Feb, 2010 Comments Off

During recent DPS invoicing conference calls, there has been some discussion of the applicability date of the fuel surcharge. We have always applied the fuel surcharge based on the date of the service, but we have noticed the DPS rating engine is applying the fuel surcharge for linehaul service based on the original pickup date, even if the shipment was placed in origin SIT. It was a minor difference, but one we asked SDDC to clarify, since the TR-12 Fuel Policy, which governs the application of fuel surcharge, is unclear on this point.

SDDC addressed this issue during the invoicing calls, and stated DPS is rating these shipments correctly, and the linehaul fuel surcharge should always be based on the pickup date, even if the shipment went into origin SIT. During the subsequent discussion of this issue, some statements were made by SDDC personnel that led many on the call to believe that SDDC was saying that the pickup date always governed the fuel surcharge application date, even on deliveries out of destination SIT. This would have been a major change in policy and potentially impact a large number of shipments.

We asked for further clarification from SDDC on whether it was their intent to have the fuel surcharge application date always governed by pickup date, even in cases of destination SIT. This morning, we had a chance to discuss this issue with SDDC personnel and they stated that it was not their intent to make that change. They stated that the fuel surcharge on linehaul (DPS Item Code 16A) should be based on pickup date if shipment went into origin SIT, but that in cases on delivery out of destination SIT, the fuel surcharge for delivery out(DPS Item Code 16B) should be based on the date of the delivery out, not pickup date.

While we still believe that the fuel surcharge should always be based on date of service, we will accept their interpretation that fuel surcharge is based on pickup date in cases of origin SIT, and will change our programming accordingly. We appreciate their efforts to clarify the larger issue, and we were very relieved to hear they were not making that policy change.