Union Pacific Corporation and Norfolk Southern Corporation said their proposed combination has moved forward after the U.S. Surface Transportation Board (STB) unanimously denied requests from opponents seeking dismissal of the companies’ revised merger application. The decision allows the STB to continue its review of the revised application submitted by the two rail companies. The proposed transaction is aimed at combining the Union Pacific and Norfolk Southern networks to create a transcontinental railroad serving customers across the United States.
The companies said the combined network would eliminate interchanges between the two railroads on certain routes and provide customers with single-line freight service. According to the companies’ merger application, the combination would create seven new premium intermodal lanes and convert approximately 10,000 existing interline lanes to single-line service.
The proposed transaction would also retain existing gateways, while expanding the network’s ability to compete for intermodal freight currently moved by road. The companies have said the combined operation could remove more than 2 million truckloads from highways and provide customers with additional freight transportation options.
“The momentum behind this transaction continues to build, and we are ready to keep moving forward,” said Union Pacific CEO Jim Vena. “As we said at the beginning: this merger is all about increasing growth and competition. It’s good for our employees, customers and America.”
Union Pacific and Norfolk Southern have also reached a jobs-for-life agreement with the International Association of Sheet Metal, Air, Rail and Transportation’s Railroad Mechanical Department (SMART-MD). Under the agreement, the companies said every employee holding a union job when the merger is approved will continue to have employment for life.
Mark George, President and CEO, Norfolk Southern, said: “The STB’s decision marks another important step in bringing Union Pacific and Norfolk Southern together, and we welcome the opportunity to continue sharing the many benefits of this transformative transaction. The combination will create new opportunities for customers across merchandise, bulk and intermodal markets through a more connected, efficient rail network. As the process moves forward, we are glad to add SMART-MD to a growing list of labor supporters, helping to ensure that we will grow together while protecting opportunities for railroaders.”
The companies said the proposed combination would allow merchandise and bulk freight to move with fewer handoffs and could reduce transportation, inventory and asset costs. They also expect the combined network to increase competition among rail operators.
The transaction remains subject to review and approval by the STB and will continue to be subject to regulatory oversight after closing. Union Pacific and Norfolk Southern expect the transaction to be completed in the second half of 2027, subject to the regulatory process.
Union Pacific operates a freight railroad network across 23 western US states, connecting customers and communities to domestic and international markets. Norfolk Southern Corporation operates a freight transportation network across 22 states. The company serves major manufacturing and population centres and operates an extensive intermodal network across the eastern United States.
