Forty chief executives from top U.S. chemical companies have called on President Donald Trump and federal regulators to reject or closely review the proposed rail merger between Union Pacific (UP) and Norfolk Southern (NS). Industry leaders say the deal represents the largest and most far-reaching freight rail consolidation ever reviewed by the Surface Transportation Board (STB).
In a joint letter released by the American Chemistry Council (ACC), executives warned that the merger could reduce rail competition, disrupt supply chains, and drive up transportation costs for U.S. manufacturers.
“Fewer railroads mean fewer options for shippers — and that makes U.S. manufacturing less competitive globally,” the letter stated.
If approved, the merger would create a transcontinental rail giant controlling nearly half of U.S. freight traffic. The ACC noted that just four major railroads already handle over 90 percent of all U.S. rail shipments. Industry experts fear the merger could pave the way toward a national rail duopoly, squeezing out competition and flexibility for shippers.
Past rail consolidations have led to widespread service breakdowns, shipping delays, and increased costs. The chemical industry — one of the largest users of freight rail — could be among the hardest hit, as it depends heavily on reliable, affordable rail service to move raw materials and finished goods across the country.
“The chemical sector is a cornerstone of American manufacturing,” said Chris Jahn, ACC President and CEO. “Dependable and competitive rail service is critical to keeping our supply chains strong.”
Jahn acknowledged the administration’s efforts to rebuild U.S. manufacturing but cautioned that unchecked mergers could reverse that progress.
“President Trump has made real strides in revitalizing American manufacturing,” Jahn said. “We can’t allow a rail monopoly to undermine that. What we need is competition — a system that lowers costs, creates jobs, and strengthens the U.S. economy.”
The ACC and its member companies are urging the Surface Transportation Board to enforce strict merger standards and reject any deal that fails to enhance rail-to-rail competition or improve service reliability.
Background on Rail Industry Consolidation
The proposed UP-NS merger comes amid decades of consolidation in the U.S. freight rail sector. Since the 1980s, the number of Class I railroads has dropped by more than 70 percent. According to ACC, this trend has contributed to higher shipping costs, weaker service performance, and greater vulnerability to supply chain disruptions.
Chemical shipments remain one of rail’s most valuable markets, generating over $13 billion in annual revenue and representing more than 8% of total U.S. rail carloads, according to data from the ACC and the Association of American Railroads.