In letter to President Trump, chemical industry leaders warn UP-NS rail merger threatens U.S. manufacturing competitiveness
Summary
The American Chemistry Council (ACC), representing 40 chemical-company CEOs, has written to President Trump urging the Surface Transportation Board (STB) to scrutinise the proposed Union Pacific (UP)–Norfolk Southern (NS) merger. The CEOs argue the deal would reduce competition, leave many facilities captive to a single carrier, raise rates and worsen service — harming US manufacturing competitiveness.
The letter warns past rail consolidation has led to service disruptions and sharply higher rates for captive shippers. ACC leaders say the STB must set a high bar under its merger rules and reject any proposal that does not demonstrably improve service, safety and rail-to-rail competition. Union and railroad leaders counter the merger would protect jobs and unlock growth.
Key Points
- ACC and 40 chemical CEOs warn the UP–NS merger would reduce rail competition and harm US manufacturers.
- They cite historical evidence that mergers often cause service degradation, higher rates and weakened supply chains.
- Many chemical plants are served by only one major railroad, making them ‘captive’ and vulnerable to rate increases.
- The CEOs urge the STB to reject mergers that do not clearly improve service, safety and rail-to-rail competition under its new merger rules.
- SMART-TD, the largest North American rail union, supports the merger based on job-protection guarantees from UP and NS, while UP/NS argue the deal will create growth and reduce road congestion.
Why should I read this?
Short version: if you make, move or buy stuff in the US, this could change how much you pay and how reliably your supply chain runs. The chemical sector is basically shouting ‘check this’ because a big rail tie-up might mean fewer choices, higher bills and bumpier deliveries. Worth five minutes to know which way regulators might lean.
Context and Relevance
This issue sits at the intersection of transport consolidation, supply-chain resilience and industrial competitiveness. Rail remains the backbone for heavy freight and bulk chemicals; fewer major carriers can translate into local monopolies for many plants. The ACC’s letter frames the STB’s pending review as pivotal for US manufacturing policy: approving a deal that reduces rail-to-rail competition could accelerate further consolidation and amplify cost and service risks for manufacturers, farmers and energy producers.
Regulatory scrutiny will focus on whether the merger demonstrably improves service, safety and competition. Union backing for the deal — based on job protections — adds political weight, while railroad executives stress network efficiencies and reduced highway congestion. The outcome will influence freight rates, investment decisions and nearshoring/reshoring strategies that depend on reliable, affordable rail service.
