News / More Republicans defy Trump over UP-NS mega-rail merger

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40 “America First” Republicans want greater scrutiny over the $85bn Union Pacific-Norfolk Southern rail merger, pouring further uncertainty over the deal and putting them on a collision course with President Trump.

US rail regulator the Surface Transportation Board (STB) has released a letter they signed alongside seven other Republican representatives, expressing concern over the tie-up’s impact on costs for businesses and consumers.

It said: “As representatives of states that rely on competitive and reliable rail service to move goods essential to the US economy, we’ve a strong interest in ensuring transactions that could concentrate market power, reduce competition, or degrade service are carefully scrutinised.

“Also, and consistent with the Trump administration’s pro-growth economic agenda, we remain keenly focused on ensuring government decision-making does not result in the costs of goods and services going up for American businesses and consumers.”

Pointing out that a joint UP-NS railroad would be responsible for handling “almost half the nation’s rail freight”, the representatives expressed particular concern over what they described as the railroads’ “lack of serious commitment” in preventing “service meltdowns” and protecting competition.

These concerns incuded complaints of a reduction in quality and pricing practices that followed waves of consolidation and deregulation in the 1980s, 1990s, and early 2000s.

It added: “We also want to underscore responsibility to demonstrate clear, measurable, and substantial benefits for domestic manufacturers, agricultural producers, the energy sector, and the American consumer – all of whom rely on an efficient, competitive, and cost-effective freight rail system – rests squarely with the applicant railroads. Absent such a showing, the board should not permit this transaction to proceed.”

The letter places its signatories on a collision course with the president, who, asked in September what he thought of the deal, commented “sounds good to me, Union Pacific is a great railroad”.  His support was exemplified by his decision to remove STB member Robert Primus, who opposed further railroad consolidation.

One voice noticeably absent is that of Vice-president JD Vance who has expressed support for the stalled rail safety bill and has been vocal on issues of consolidation.

The intervention follows the STB rejection of the merger filing as incomplete after separate, but broadly aligned, filings, from BNSF, Canadian Pacific Kansas City, Canadian National, and CSX urging the board to reject the merger filing on that basis.

Giving its reasoning, the STB said the application lacks the full merger agreement, including details on its obligations and its ability to cancel the deal; describing associated acquisitions the STB considers “significant” as “minor”; and the absence of market share projections.

However, the STB pointed out that the merger was ‘far from dead’, noting that Union Pacific had until 17 February to indicate if it would refile an amended application, which would be due by 22 June.

All signs are that it will go ahead, but there have been suggestions that it could take the carrier up to three months to complete the application suiting the STB; and now it seems more eyes would be on it.