Coalition opposes Union Pacific, Norfolk Southern rail merger

By David Shepardson

WASHINGTON, April 29 (Reuters) - A coalition of business groups, rival railroads and organized labor on Wednesday said it opposes Union Pacific's UNP.N proposed $85 billion merger with Norfolk Southern NSC.N, a day before the pair are set to file a revised application with the Surface Transportation Board.

The coalition - which includes the American Chemistry Council, the American Farm Bureau Federation, Teamsters Rail Conference, BNSF Railway, CPKC Railway, Alliance for Chemical Distribution, National Industrial Transportation League and Vinyl Institute - argues the deal will reduce competition and increase costs for manufacturers, farmers and consumers.

The deal would create the first U.S. coast-to-coast freight rail operator and could reshape the country's freight rail industry, helping to streamline operations and eliminate interchange delays in hubs like Chicago.

Union Pacific said the groups opposing the merger were distorting facts and that its revised application "clearly reinforces the case for a coast-to-coast railroad, making rail more competitive to other modes of transportation, reducing costs and delivering benefits that will make American goods more affordable."

The railroads filed their nearly 7,000‑page application on December 19, saying the combination would improve service reliability, divert freight from trucks to rail, retain shipper options and deliver broad public benefits while protecting union jobs.

President Donald Trump has publicly backed the proposed merger, which would have been unthinkable under the previous Biden administration and its broader crackdown on consolidation.

The Trump administration has tended to approve large transactions or impose remedies rather than block them outright.

Some Republican state attorneys general and other state officials have raised concerns about the deal.

The railroad industry has struggled with volatile freight volumes, rising labor and fuel costs, and growing pressure from shippers over service reliability.

It is the first major proposed railroad merger to be reviewed under the stricter framework put in place more than two decades ago, which requires applicants to prove their transaction would enhance competition — not merely preserve it — while delivering demonstrable public-interest benefits.