BNSF Slams Union Pacific-Norfolk Southern Merger, Warns of Lost Competition and Higher Rates

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Mon, October 6, 2025 at 7:00 AM EDT 4 min read

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BNSF Railway has publicly rebuked the proposed $85 billion merger between Union Pacific and Norfolk Southern, calling on customers to air any grievances they may have with the deal to the Surface Transportation Board (STB).

On Sept. 26, the STB invited public commentary on its impending review of the acquisition, which would create the first U.S. transcontinental railroad. The deadline for comments is Oct. 16.

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“No customer is asking for a UP-NS merger to happen. It’s driven by Wall Street on the promise of a big shareholder payout,” the company said in a position paper posted on its website. “BNSF does not believe a merger is necessary at this time, when we can deliver immediate benefits to our customers while preserving competition.”

In the paper, BNSF highlighted that a merger of Union Pacific and Norfolk Southern would control 45 percent of existing freight, citing STB metrics that also indicated that the combined company would move 46 percent of containers and have 43 percent market share of total carload volumes. The combined companies would cover more than 50 percent of market share across categories including chemicals, metals and lumber.

Carload and agricultural products customers will be most impacted, the Fort Worth, Texas-based railroad said, claiming that they will lose optionality in shipping to the eastern U.S. or “face significantly higher rates on traffic” that currently interchanges with Norfolk Southern.

“Post-merger, some lucky customers will still have two rail options—a single-line UP service and a BNSF-CSX option,” the railroad said, highlighting the Warren Buffett-owned railroad’s recent partnership. “For many shippers and for many origination and destination pairs, however, there will be no BNSF-CSX option because they are served only by UP or NS at origin or destination who have no incentive or obligation to facilitate alternative routes, creating a new generation of captive shippers.”

Union Pacific CEO Jim Vena has defended the deal, citing that companies like CSX and Canadian National Railway have already had their own tie-ups in an attempt to match the efficiency of a potential single-system railroad.

Despite an activist investor’s prodding of CSX to examine a merger with BNSF as a counter to the Union Pacific-Norfolk Southern transaction, the Berkshire Hathaway subsidiary has been intent that it does not want to explore such a deal. According to the STB’s data, a BNSF-CSX merger would put the combined firm on roughly equal footing when it came to share of carloads and containers.

BNSF went after Union Pacific’s claims that the merger would be paid for through 10 percent volume growth within three years of the deal’s closing, calling the target unachievable. The Class I railroad said that UP’s last mega-merger with Southern Pacific Transportation in 1996 resulted in a reduction in volumes, along with an increase in their revenue per unit and record profits.

“Less competition means fewer alternatives and higher rates, as well as reduced capital investments across the rail industry,” BNSF stated.

In a separate letter to BNSF customers on Monday, executive vice president and chief marketing officer Tom Williams highlighted concerns about possible service disruptions.

“Integration challenges have historically caused ripple effects across the national network, even for customers not directly served by the merging railroads,” said Williams. “When UP was challenged during the supply chain crisis, they issued over 1,000 embargoes causing competitive and financial harm to many customers and invited STB intervention.”

And if a merger is approved, BNSF claims 300 intermodal lanes across the U.S. will be eliminated, based on the assumption that all current UP-CSX and BNSF-NS lanes will be shuttered.

Union Pacific has denied those claims, calling them “absolutely false,” and saying that more than 100 shippers have written letters in support of the merger.

The STB has traditionally not considered approving railroad mergers of this magnitude. But the Trump administration’s public support of a Union Pacific-Norfolk Southern acquisition, and September’s STB shakeup including the firing of an STB board member and a new nominee, could suggest a more favorable opinion from the regulatory body.

For the next steps in the merger process, Union Pacific and Norfolk Southern will file their merger application to the STB between Oct. 29 and Jan. 29.

Any initial concerns about the completeness of the UP/NS application should be filed quickly, BNSF told customers, “ideally within one to two weeks after the application is filed.”

The STB will either approve or reject the proposal within 30 days of its submission. If approved, the board would begin conducting its review. This would evaluate how the pending Class I transaction, which would create the first single U.S. transcontinental railroad, would enhance competition.

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