UPS experienced a significant increase in the number of packages requiring customs clearance after the end of the de minimis exemption, according to CEO Carol Tomé. The change, implemented by the Trump administration in late August, eliminated the previous policy that allowed low-value shipments—those under $800—to enter the U.S. tariff-free. Since then, UPS has seen a sharp rise in the volume of packages that must go through customs processing. Tomé revealed during the company’s third-quarter earnings call that the number of daily customs-clearance shipments jumped from about 13,000 in March to roughly 112,000 in September—the first full month after the exemption ended. She attributed much of the surge to consumers who were unprepared for the new requirements, noting that many were “naive” about the documentation needed to clear customs. “These individuals wouldn’t be expected to understand the intricacies of trade policies,” Tomé said. “They shipped packages that lacked the necessary information to clear customs.” Kate Gutmann, EVP and president of international, healthcare, and supply chain solutions at UPS, added that many of the delayed shipments contained food products. She also noted that some national postal services, including Germany’s Deutsche Post, had temporarily suspended shipments to the U.S. due to the change. Customers reported a range of issues. Some received incorrect tariff bills—such as a 200% duty on Russian aluminum—despite sending non-metallic goods. Others found their packages marked for disposal even after paying tariffs or submitting additional documentation. While some affected individuals were private consumers, others were small business owners with years of experience shipping into the U.S. One Canadian customer said he reached out to Tomé multiple times about a package that appeared to be lost in the system. Despite these challenges, UPS said it was able to automatically process about 90% of the customs-bound packages using technology, including AI tools. However, the remaining 10% required manual review and intervention, which Tomé acknowledged was a strain on operations. “We’re seeing a lot of these packages where they really needed some help,” she said. The shift has highlighted the complexity of international shipping and the growing burden on logistics providers as trade policies evolve. For now, UPS continues to work through the backlog and improve its systems to handle the increased volume and complexity of customs compliance.