This is part of a Hub and Spoke series on Antitrust Policy under Trump 2.0. You can find the Hub and Spoke’s previous coverage here, here, here, and here.
Last week, Union Pacific and Norfolk Southern announced a mega merger between the two competing railroads in order to “create America’s first transcontinental railroad.” The announcement has garnered strong, negative reactions from the public and may face some headwinds at the Surface Transportation Board (the Board), which maintains exclusive jurisdiction to review and approve railroad mergers and acquisitions. The merger would combine 50,000 miles of track across 43 states, uniting Union Pacific’s railroad network that operates largely in the western part of the U.S. with Norfolk’s mainly eastern railroad. Various unions, including the SMART Transportation Division (SMART-TD), oppose the deal and have raised safety concerns about merging the two entities. Additionally, seven associations of shippers (customers of the railroad companies) note that the merger will lead to higher shipping prices and a reduction in service standards.
This Union Pacific/Norfolk Southern merger continues a trend during the Trump Administration—large companies willing to execute high-risk mergers. As previously detailed by SCL’s Lindsay Maher, mergers analyzed by the DOJ and FTC in the current administration have largely been approved with some minor concessions or divestitures by the merging parties (see also SCL’s Hub and Spoke Podcast with Amanda Hamilton, Wyatt Fore and Lindsay Maher). Other agencies also appear to also be willing to “make a deal.” In late July, the Federal Communications Commission approved the Paramount Global/Skydance Media but required that the merging parties agreed to end DEI policies and commit to “unbiased journalism.”
This merger presents another opportunity for impacted parties to raise concerns, as the Board retains the power to extract valuable concessions from the railroad companies. In fact, during the Biden Administration, the Board approved Canadian Pacific Railway Limited’s acquisition of the Kansas City Railway Company. In so doing, the Board granted itself seven years of oversight and imposed “numerous conditions to preserve existing rail service options at affected ‘gateways,’” requiring the merged entity to provide written justifications for any price increase so that shippers could challenge “the commercial reasonableness of [the] rates.” The Board also implementing additional “labor protective conditions” to ensure the safety of railroad employees.
Given the concerns emanating from the Union Pacific/Norfolk Southern merger as well as the Trump Administration’s continued dealmaking efforts, it is safe to presume that the Board may again be willing to approve the merger subject to various conditions. While the parties indicate that they intend to file their application with the Board in early 2026, impacted parties, including shippers, workers, and consumers should be prepared to submit comments and meet with the Board to voice their concerns and solutions.
