In Oval Office remarks reported by White House media, Trump said the tie-up that would create the first transcontinental freight railroad “sounds good to me. Union Pacific is a great railroad.” Trump also said he was a fan of UP’s CEO, Jim Vena.
It was the latest move by the administration to back the merger, which was jointly announced by UP and NS in late July.
Trump met with UP Chief Executive Jim Vena last week in the Oval Office, when he first expressed support for the Omaha-based company’s acquisition of NS, headquartered in Atlanta.
The consolidation of western UP, the largest U.S. railroad, and NS would create a vast network of 52,000 miles of track in 43 states. It would offer shippers single-line transit for freight, which the railroads claim would eliminate delays at key interchange points, attract more business, and help jumpstart growth.
While some major intermodal companies have thrown their support behind the merger, shipper associations representing manufacturers, agri-businesses, and energy producers have voiced their opposition, charging the deal would eliminate competition while raising freight costs and compounding service issues.
The American Chemistry Council said the president can make a better deal for America than the UP-NS merger.
“American success relies on President Trump working with railroads, manufacturers, agriculture, and industry to craft a bigger and better deal for America,” Chris Jahn, CEO of the chemical industry’s trade association, said in a statement.
“While Union Pacific-Norfolk Southern claim the merger will help, it’s a bad deal for America because the facts tell a different story. This deal would lead to a monopoly — crushing competition, raising costs, and undermining the progress President Trump has made on American manufacturing, farming, and energy production.”
Since the announcement, competing railroads have introduced new intermodal partnerships, to demonstrate that collaboration is preferable to a complicated merger. In response, UP and NS rolled out new interline services of their own.
The proposal is subject to review by the Surface Transportation Board, an independent agency. UP and NS earlier said that they could submit their formal application as soon as late October. The deal will be the first subject to tougher merger rules but industry observers have speculated that Trump’s support could accelerate the review process.
Trump last month fired STB member Robert Primus, a Democrat who had been the lone vote against the 2023 merger between Canadian Pacific and Kansas City Southern. Last week Trump re-nominated Republican Michelle Schultz to the regulator, and also tabbed railroad industry consultant Richard Kloster, also a Republican, to an initial term.
Trains staff contributed to this story, which originally appeared at Freightwaves.com.
“Since the announcement, competing railroads have introduced new intermodal partnerships, to demonstrate that collaboration is preferable to a complicated merger.” The class ones should have been working together all along for the sake of the customers and the industry. It’s no wonder railroads are bleeding traffic to trucks.
Well it looks like Vena’s ego-stroking of Trump worked!