Norfolk Southern Gains as Key Union Backs $85B Union Pacific Merger
The deal, which would create the first coast-to-coast U.S. rail network, clears a major hurdle with the endorsement from the SMART-TD union.
In a pivotal development for one of the largest proposed mergers in the U.S. transportation sector, Union Pacific's ambitious $85 billion acquisition of Norfolk Southern has received a crucial endorsement. The largest U.S. rail union, SMART-TD, has reversed its initial opposition to the deal, removing a significant obstacle and signaling strong momentum for the creation of a transcontinental railroad.
The union's change of heart came after for its members. In a statement, SMART-TD President Jeremy Ferguson hailed the agreement as a landmark achievement that ensures career-long job security for train and yardmaster service employees, who will not face involuntary furloughs as a result of the merger. This concession was key to winning the union's support for a transaction that promises to reshape the American logistics landscape.
If approved, the merger would in the United States, a sprawling system connecting over 50,000 route miles across 43 states. The combined entity would boast an estimated value of over $250 billion, linking approximately 100 ports and creating new efficiencies for shippers of consumer goods and other materials.
Despite the breakthrough, the deal is not yet clear for departure. The transaction must still by the Surface Transportation Board (STB), which has historically been cautious about further consolidation in the rail industry. Union Pacific and Norfolk Southern are expected to file their formal application with the STB between late 2025 and January 2026, with a potential closing date in early 2027.
While the SMART-TD endorsement is a major victory, the proposal is not without its critics. Other unions and customer groups have about the potential impact on competition, shipping rates, and non-union jobs. The coming months will see intense scrutiny from regulators and stakeholders as they weigh the benefits of a unified national rail network against the risks of reduced competition.