Union Pacific Says Merger Would Cut Shipping Costs by $3.5B

(Union Pacific by Nati Harnik/Associated Press; Norfolk Southern by Gene J. Puskar/Associated Press)

Railroad operators Union Pacific Corp. and Norfolk Southern Corp. say their proposed $72 billion deal would save shippers $3.5 billion annually in an amended merger application filed April 30.

A transcontinental operator, which would be created by the merger, would offer a single-line service that’s more competitive on price with longhaul trucking, according to a filing to the industry regulator, the Surface Transportation Board. It would also save shippers money on inventory and equipment costs, the companies say. 

“This merger enhances competition and delivers real public benefits that make America’s supply chain stronger,” Jim Vena, chief executive of Union Pacific, said in a statement. He added that the companies’ analysis identifies “even more opportunities for our combined railroad to grow and compete.”

Union Pacific announced a deal to buy Norfolk last July. It would create the largest network in North America with a presence in 43 U.S. states. The deal has garnered opposition from peers and customers — on April 29 a new group, called Stop the Rail Merger Coalition was announced. 

The group, made up of BNSF Railway Co., Canadian Pacific Kansas City and the Teamsters Rail Conference among its members, released polling stating that 71% of Americans oppose the deal after learning about its impacts, while 20% support it. 

“This did not begin with a customer asking for a UP-NS merger to happen,” Katie Farmer, president and CEO of BNSF, said in a statement. “It’s driven by Wall Street on the promise of a big shareholder payout. It will eliminate competition, raise costs for consumers, and destabilize the supply chain that powers the American economy.”

Union Pacific and Norfolk Southern are proposing a merger that would give them control over nearly half the freight rail market. The Teamsters represent tens of thousands of workers at the two railroads — and we will not let our members be left behind: https://t.co/uXQpsMpXdv pic.twitter.com/EGOJ6bSkqq — Teamsters (@Teamsters) April 29, 2026

Union Pacific and Norfolk’s analysis of the deal states that it would have no meaningful impact on geographic competition or on the availability of independent routes, while an additional net 1,200 union jobs will be needed by the third year after the merger to handle the expected volume growth. 

The companies have committed to sell or relinquish control of the Terminal Railroad Association of St. Louis, a smaller rail operator that operates about 170 miles of track, in which the two companies combined own a majority stake.