Last Mile Costs Soar 12% Annually

Last-mile delivery costs have continued their upward trajectory, with a median increase of 12% reported in 2026, matching the previous year's growth. This trend was confirmed by Kushal Nahata, CEO of FarEye, during a recent event in Chicago. The findings are based on survey data from over 3,000 U.S. delivery operators gathered in the first half of 2026.

Operators most frequently cited fuel (70%), driver cost and availability (51%), and vehicle operating costs (40%) as their top three cost pressures. Inefficient routing and failed deliveries also contributed to these rising expenses. Nahata noted that these increases are driven by both external factors like increased public rates from carriers and internal operational inefficiencies.

Faced with these challenges, 45% of operators have identified reducing delivery costs as a top three investment priority. Companies with over $1 billion in revenue experienced the highest median cost increase at 13.8%. Alongside cost concerns, operators prioritize predictable delivery times and successful first-attempt deliveries, which together accounted for 55.7% of what matters most.