December 4th, 2025 – Major U.S. ports and their industry partners are warning federal regulators that the proposed merger between Union Pacific and Norfolk Southern could weaken port competitiveness and strain the national economy unless it receives a rigorous review.
In a letter to the Surface Transportation Board (STB), the National Association of Waterfront Employers (NAWE)—whose members include port authorities and terminal operators—expressed deep concerns about a merger that would create the country’s first freight-only transcontinental railroad. The group argued that reducing the number of major competitors in the intermodal rail market could negatively affect maritime industry operations and limit the options available for efficient cargo movement.
While some shippers and intermodal providers have supported the merger since Union Pacific announced its plan to acquire Norfolk Southern in July, many others remain skeptical. They question whether promised improvements in service and reduced congestion can offset the risks of consolidating more control within fewer rail carriers. NAWE emphasized that intermodal rail is an essential link for U.S. ports and the businesses dependent on them, and that competition in this sector is already limited. Additional consolidation, it warned, could influence port competitiveness, cargo flow, and broader economic development.
The association’s concerns align with earlier reporting suggesting that several East Coast ports fear the merger could undermine billions of dollars in infrastructure investments aimed at growing their share of direct Asian import traffic. A streamlined coast-to-coast rail system may, they argue, help West Coast gateways reestablish an intermodal landbridge to eastern markets. At present, roughly 40% of containerized imports arriving at East Coast ports move inland by rail, compared with about 60% at West Coast ports.
NAWE noted that the merger would leave only two major transcontinental intermodal service providers, concentrating the market further and raising the risk that certain routes could be prioritized at the expense of others. Ports such as Los Angeles and Long Beach rely heavily on rail to move more than 60% of inbound cargo to inland hubs like Chicago, and any reduction in service reliability or competition could disrupt supply chains nationwide.
The group also highlighted that railroads have lagged in investing in intermodal infrastructure. Marine terminals frequently bear the full cost of developing on-dock rail facilities, often without long-term service assurances. This dynamic has been worsened by investor pressure on rail carriers to favor short-term financial performance.
NAWE stressed that the STB’s decision on the merger will influence the future of intermodal freight movement and urged regulators to consider long-term effects on port communities, infrastructure investment, supply chain resilience, and the national economy. The railroads are expected to file their formal merger application this week, and NAWE reiterated its commitment to working with regulators and industry partners to support a rail network that meets the needs of maritime and intermodal commerce.
