In August 2025, Union Pacific (UP) and Norfolk Southern (NS) – two of the largest Class I freight railroad companies – announced an $85 billion merger.
As one of the largest customers of freight rail in both volume and revenue, the chemical industry relies on the rail system to transport products essential to Americans’ health and safety. Freight rail is still – by far – the safest method of shipping, with 99.9% of hazmat chemicals shipped by rail arriving at their destination safely. Unfortunately, ACD members are typically serviced by only a single rail carrier, subjecting them to high freight rates, capacity constraints, and ongoing service issues. According to a 2025 rail survey of our members:
Despite deteriorating service, railroads are rarely held accountable for supply chain disruptions caused by extensive monopolies and an outdated regulatory system.
ACD remains deeply concerned that approval of this rail merger would only exacerbate existing challenges and further expand the rail industry’s market power and profit margins to the detriment of its customers.
Update: Surface Transportation Board Action
On April 30, 2026, UP and NS are expected to refile their merger application to the Surface Transportation Board (STB) after the board initially rejected the application on January 16, 2026. The STB found the submission incomplete and insufficient for review, determining the application lacked critical information, including analyses of market share impacts and a complete copy of the merger agreement.
The initial rejection of this application reinforces the importance of transparency and rigorous analysis when evaluating mergers with significant implications for competition, service reliability, and the broader supply chain.
Next Steps:
The STB will continue to play a critical role in determining whether this merger moves forward. ACD encourages the STB to maintain its high bar for merger review and ensure freight rail customers have access to competitive, efficient, and reliable rail service. ACD encourages the board to conduct a comprehensive and rigorous review of the application.
Under the STB’s rules, any merger must protect and enhance competition and serve the public interest. Given the rail industry’s already high level of concentration and its continued failure to meaningfully improve service, this proposed merger is unlikely to meet either standard.
If you have questions or would like to get involved in ACD’s advocacy around this issue, please reach out to Nicholas Breslin at nbreslin@acd-chem.com.
File Your Letter with the STB
File Your Letter through ACD
The resources on this webpage are intended for member education. If you’re interested in using this information for media coverage or want to learn more about the impact of the NS-UP rail merger on the chemical distribution industry, please reach out to ACD Public Affairs Senior Manager, Susannah Williams at swilliams@acd-chem.com.