Unions, Shippers Oppose $85B Union Pacific-Norfolk Southern Rail Merger

Union Pacific and Norfolk Southern have announced an $85 billion merger deal to create the first U.S. coast-to-coast freight rail operator, combining networks that span the western and eastern United States. The merger, expected to close in early 2027 after regulatory review, aims to reduce freight bottlenecks like those in Chicago and create operational efficiencies, unlocking about $2.75 billion in annual synergies. However, the Transport Workers Union and other rail unions strongly oppose the merger, citing concerns over safety risks and significant job cuts, noting Union Pacific's poor safety record. Rail shipper groups, including the National Industrial Transportation League and the American Chemistry Council, also oppose the deal, arguing that further consolidation will reduce competition, increase rates, and degrade service quality, especially for industries reliant on rail transport of hazardous materials and chemicals. Critics warn that the merger would reduce the number of major Class I freight railroads from six to five, thereby increasing railroad oligopoly power. The deal reflects a shift in antitrust enforcement under President Trump’s administration, which has eased barriers to consolidation despite concerns raised by workers and shippers.