WASHINGTON — More than 60 trade associations have told federal regulators that they fear that Union Pacific’s proposed $85 billion acquisition of Norfolk Southern will raise rates, hurt service, and put too much traffic under control of a single railroad.
“History has shown that increased rail consolidation leads to fewer choices, higher transportation costs, service disruptions, and reduced economic competitiveness,” the associations said in their Nov. 24 letter to the Surface Transportation Board.
The groups urged the STB to give the merger a thorough review. The railroads have yet to file their merger application with the STB, but expect to do so in early December.
“Given the potential for widespread economic harm, it is essential that the Surface Transportation Board proceed with great care,” the groups wrote. “The creation of a transcontinental railroad must not come at the expense of competition, service reliability, or the broader health of the U.S. supply chain.”
Signatories to the letter include the National Industrial Transportation League, the Freight Rail Customer Alliance, and trade associations representing agricultural producers, automakers and vehicle dealers, chemical producers, home builders, mining companies, and forest products companies. The Rail Passengers Association also signed the letter.
UP and NS say their merger will boost competition, improve service, reduce costs for shippers, take trucks off the highway, and allow American importers and exporters to better compete in global markets. They also have pledged a smooth integration process.
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So many more negatives than positives to the acquisition.