A back-and-forth exchange this week between the CEOs of Union Pacific and BNSF Railway over potential impacts of a UP-Norfolk Southern merger has seen UP CEO Jim Vena refuting BNSF’s claim that his railroad would eliminate 300 intermodal lanes if the merger is approved, and BNSF CEO Katie Farmer saying Vena’s statement is welcome.
The 300-lane figure is included in a one-page BNSF position paper on the proposed merger, headlined “Costly, Unnecessary, Anti-Competitive and Bad for the U.S. Economy.” After making the claim that 300 intermodal lanes would be closed, it states, “After the last major round of mergers, 90 intermodal facilities closed, resulting in several hundred fewer intermodal lane options and communities permanently losing their intermodal access.”
Vena, in a presentation Tuesday to the Baird 2025 Global Industrial Conference, said he had the BNSF document sitting in his bathroom “next to the sink with the toothpaste.
“I go, ‘Really?’ Why would we shut off 300 lanes?” Vena said, according to a transcript. “First of all, we do not have 300 lanes in intermodal. There are not that many lanes. I said to Kenny [Rocker, UP executive vice president, marketing and sales], ‘are you hiding 290 lanes from me that I do not understand? They said we are going to shut down that many.’ I laugh.
“I find it interesting that [BNSF parent] Berkshire [Hathaway] (NYSE: BRK-B) is coming after us that hard.”
Union Pacific shareholders are scheduled to vote on the proposed merger Friday.
Farmer responded in a Wednesday statement, saying, “I’m sure the nation’s rail customers are relieved that UP (NYSE: UNP) is committing to keep all current intermodal lanes open if their merger with NS is approved. UP highlighted in prior rail industry mergers that the new merged railroad usually raises rates on competing interchange partners to the point of making those lanes economically uncompetitive.”
The BNSF statement quoted UP filings with the Surface Transportation Board on the 2023 Canadian Pacific-Kansas City Southern merger (NYSE: CP), including a call for the board to “impose conditions to prevent the reduction of competitive options at gateways” if the merger took place.”
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