OMAHA, Neb. — The nation’s largest railroad union has endorsed Union Pacific’s proposed $85 billion acquisition of Norfolk Southern after securing written commitments to protect jobs for current rail workers. The endorsement comes amid ongoing concerns from other unions and stakeholders, including chemical manufacturers who rely on rail transport.
The SMART-TD union, which represents conductors and various rail workers, stated that Union Pacific’s CEO, Jim Vena, assured them in writing that no layoffs would occur as a result of the merger. The union highlighted that this commitment aims to safeguard the future of its members as well as the broader rail workforce. Jeremy Ferguson, the union’s president, expressed a shift in his stance towards the merger, asserting that it would ultimately benefit the workers and the U.S. supply chain.
Conversely, the Brotherhood of Maintenance of Way Employes Division—the second largest union—remains skeptical. Its president, Tony Cardwell, conveyed dissatisfaction with the merger’s potential to protect jobs. He voiced concerns regarding workers being compelled to take positions with smaller railroads or moving across the country, both of which could significantly alter their employment prospects.
Cardwell emphasized that without adequate protection for workers, his union would oppose the merger vehemently. This resistance aligns with the perspectives of the American Chemistry Council and the Rail Customer Coalition, both of which argue that the merger could decrease competition and inflate shipping costs, reminiscent of issues seen after past rail mergers in the 1990s.
Chris Jahn, president of the American Chemistry Council, raised alarms over potential service disruptions and escalated costs that could follow the merger. He remarked that recent advancements in American manufacturing could be jeopardized by the establishment of a monopoly in the rail industry.
Despite these apprehensions, over 100 other companies have come out in favor of the merger, including major shippers and manufacturers. They anticipate that the union of Union Pacific and Norfolk Southern would lead to improved efficiency and faster delivery times, eliminating the need for shipments to transfer between railroads in Chicago—often a delay-prone process.
Adam Miller, CEO of Knight-Swift Transportation, expressed optimism that the merger would streamline logistics across a coast-to-coast rail network, benefiting both logistics providers and end consumers. Similarly, Frank Vingerhoets, president of Katoen Natie North America, noted that the merger would enable quicker and more efficient delivery of plastic products, which would positively impact the supply chain.
The proposed merger now faces a rigorous review process by the Surface Transportation Board (STB), which may take as long as two years. The board has set demanding criteria for major rail mergers following past complications. Union Pacific and Norfolk Southern executives have voiced confidence, asserting the merger would generate new growth opportunities and contribute to keeping more rail jobs in the U.S.
