By Amit Bose

The proposed Union Pacific (UP) – Norfolk Southern (NS) merger is the most significant event in the rail industry in the 21st Century.  With a war, inflation, and other topics taking up attention, the public has not been fully tuned into the proposed merger even though it will affect their pocketbooks.  Overlooked is that the merger represents the largest rail carrier merger in the United States’ history, something unseen even during the Robber Baron Era.  The new railroad would be the U.S.’s largest, making it notably larger than its competitors. Despite the stakes, the complicated merger process has failed to draw the attention it deserves.

Fortunately, the proposed merger is subject to the Surface Transportation Board’s (STB) review with opportunities for public input.  The parties need to address the different facets of their request for approval in order to have an accurate, thorough, and complete submission, and show the merger will be in the public interest and enhance competition.  Effective STB review and informed public comments can only happen with a thorough and complete record.  For those who want to be informed but have limited time, what follows is background on some of the key issues surrounding the proposed merger.

Supporters of the merger claim it would lead to a seamless transcontinental railroad that would benefit consumers, shippers, and shareholders while delivering safer railroad operations through single-line service.  These claims ignore history and economics.  While single-line movements can eliminate inter-carrier friction, consolidating parallel Class I rail networks reduces competition and options for captive shippers, creating bottleneck pricing risks that offset promised efficiencies.  After UP acquired Southern Pacific in the mid-1990s, the rail network struggled with safety issues and gridlock.  Consolidating railroads means less competition and options for businesses.

If the STB approves the merger, its implications will be national in scope, with bigger implications for concentrated areas.  Birmingham, AL, Hammond, IN, and St. Louis, MO are all places that will be disproportionately affected by the deal.  Beyond these main hubs, shared railyards and river crossings where multiple railroads swap cars, such as the Terminal Railroad Association of St. Louis and the Peoria & Pekin Union Railway, will face major operational adjustments.

Safety will be a key component of the merger review because historically, improperly integrating two different railroad networks has caused congestion, bottlenecks, accidents and derailments, and widespread disruptions detrimental to shippers and the public.  When UP and Southern Pacific merged in 1996 that is exactly what happened and contributed to the requirement that UP and NS submit a Safety Integration Plan to the Federal Railroad Administration (FRA) for review. 

The UP and NS Safety Integration Plan addresses the safety of railroad operations during the merger process.  The plan will be especially important in rail hubs, such as Chicago, St. Louis, Kansas City, Memphis and Houston.  In addition, the findings and recommendations from the FRA’s UP Safety Culture Assessment, an assessment FRA conducted of every other Class I railroad, and Atkins Nuclear Secured’s safety review of NS, an independent review initiated by NS leadership, will contribute to the safety discussion about UP and NS.

The treatment of UP and NS’s workforce is another component of the merger proposal.  Unions have been expressing their concerns with the merger due to a lack of commitments to grow and protect jobs.  Not providing assurances to the workforce raises questions about the parties long-term treatment of workers.

The STB must also conduct an environmental assessment of the application.  This process is where the public can provide further input based on information provided about the merger and its effects.  Sharing information and making it accessible is essential in order for the public to properly comment in a timely manner during STB’s public hearings about the environmental implications of the merger.  The environmental process needs to address key community issues and provide information about the potential results of the merger throughout the new railroad’s network.

Then, there’s the question of whether the Department of Justice and Department of Transportation will submit comments endorsing or opposing the merger.  DOJ announced it will fast-track its review of mergers and conduct less thorough reviews.  This raises questions: Whether this fast-track review will compromise the public interest and whether greenlighting this merger would lead to further rail industry consolidation, creating less competition and shrinking an already small pool of carriers.  Other industries are closely following this application because if the administration approves this merger, it sets the stage for more mergers to follow.

While the issues above are not to be ignored, a cloud hanging over the process is the President Donald Trump’s  firing of Robert Primus, a STB Member, which is now an uncontested issue due to the Supreme Court’s  Slaughter ruling.  The unprovoked firing of Primus naturally draws the question whether the STB can be impartial, independent and free from White House pressure.    President Trump appointed three of the current STB appointees and President Biden appointed one, who President trump reappointed.

At several milestones of the review process, the STB has already noted UP and NS’s inadequate submissions and responsiveness, including incomplete and missing information.  Concerns over procedural rules and behind-the-scenes meetings with decision-makers further highlight why all facts and discussions must be fully open to the public.  A proposed merger of this size and scope deserves transparency with accurate, complete and thorough submissions while addressing the serious questions stakeholders raise.

As the merger application process continues during a time of inflation and higher costs of living, the issues outlined above will become even more important.  Farmers, small businesses, consumers, and manufacturers rely on a competitive and balanced rail marketplace.  Concerned businesses, local communities, and the public can submit formal comments directly to the STB online under Case No. FD 36873.  Only with that information and active public participation can the public get a full view into the proposed merger and understand whether the merger will keep the marketplace fair, open, and competitive.

 Amit Bose served as Administrator of the Federal Railroad Administration (FRA) from 2022 to 2025.  He oversaw the safety of the United States’ rail network and Infrastructure Investment and Job Act’s (IIJA) historic $66 billion rail program.