In the days after the Union Pacific and Norfolk Southern railways filed papers with federal regulators on Friday to get approval for their proposed merger, a chorus of voices from different interest groups has raised increasing opposition to the deal.
They include management, labor, industry, and elected officials. Among business owners, the National Association of Waterfront Employers (NAWE) has submitted a letter to the Surface Transportation Board (STB) expressing its strong concerns.The group urged the STB to undertake a rigorous evaluation of the merger’s potential impact on the intermodal shipping networks that underpin the nation’s supply chain and regional economies.
NAWE argues that the potential merger would further concentrate the intermodal rail market, leaving only two major transcontinental intermodal service providers. That change could lead to a reduction in service options or prioritization of certain routes over others, diminishing economic opportunities in port regions nationwide, it said. “Intermodal rail service is a critical link for U.S. ports and the businesses that depend on them,” Carl Bentzel, President of NAWE, said. “Given the already limited competition in rail intermodal service, further consolidation could have significant consequences for port competitiveness, cargo flow, and regional economic development.”
Likewise, the Alliance for Chemical Distribution (ACD) encouraged the STB to oppose the merger, saying it would expand monopolistic control of freight rail at the expense of America’s critical chemical supply chain.
“Businesses remain unconvinced this mega-merger will resolve the challenges shippers are already facing, including capacity constraints, high rates, and ongoing service issues,” ACD President and CEO Eric R. Byer said in a release. “The burden of proof will now be on the freight rail companies to demonstrate how this proposal will be in the public’s interest through enhanced efficiencies and how reducing the number of rail lines will enhance – not just preserve – competition for shippers.”
And the Rail Customer Coalition (RCC)—a collection of trade associations representing the manufacturing, agricultural, and energy industries—said the STB review process would be “an unprecedented test of the Board’s updated merger standards that were adopted after previous mergers upended the rail network and crippled the national supply chain.” According to the RCC, prior rail mergers have reduced competition in the sector to the point where just four companies today control 90% of U.S. freight rail traffic. And if approved, RCC said the UP-NS deal would give a single railroad control over nearly half of all U.S. rail traffic.
Opposition also came from labor, in a joint statement from the rail worker unions the Brotherhood of Locomotive Engineers & Trainmen (BLET) and The Brotherhood of Maintenance of Way Employes (BMWE), which together represent 53% of the unionized workforce at the Union Pacific Railroad and Norfolk Southern Corp.
They say the proposed $85 billion merger would be a “de facto monopoly,” spanning 43 states and 50,000 miles of track, an approach that would be bad for consumers, business, workers, and the communities served by rail. In the historical view, the groups noted that in 1980 there were roughly 40 Class I railroads in the United States, but in 2025 that has already been reduced to six Class I railroads.
“This debt-ridden tie-up won’t make rail more competitive with trucks as merger proponents claim,” said BLET National President Mark Wallace, “We believe this transcontinental railroad will make shipping by rail less attractive as the merged carrier passes off rail lines that serve small towns, factories and farms to short line railroads while running miles-long slow-moving trains on the main line. For rail customers it will be a choice between ‘Hell or the highway.”
And politically, additional opposition has come from coalitions of state attorneys general and a bipartisan group of U.S. Senators.
UP & NS DEFEND THEIR MERGER PLAN
However, UP and NS argued in support of their merger, saying it the end-to-end combination would actually enhance competition and deliver broad public benefits, including:
- Improving rail’s competitiveness compared to trucking by shifting an estimated 2 million truckloads from highway to rail annually, resulting in reduced congestion, safer roads and less wear on taxpayer-funded roads.
- Creating efficient, flexible and reliable single-line access to more than 100 ports connecting to global markets and 10 international gateways to markets in Canada and Mexico.
- Delivering faster service by transforming 10,000 existing lanes from interline service into faster, more efficient single-line service – eliminating time-consuming handoffs between railroads.
- Driving substantial cost savings and asset productivity by eliminating 2,400 daily rail car and container handlings and 60,000 car-miles per day, translating into better margins and improved free cash flow.
- Protecting jobs – every employee with a union job when the merger is approved will continue to have one, and we expect to add approximately 900 net new union jobs by the third year following the merger.
- Investing an estimated $2.1 billion of incremental capital to support revenue and cost synergies, and expecting $133 million in annual capital synergies.
