The Union Pacific-Norfolk Southern Merger is Built for Reliability

Those long-term benefits are clear.

Still, some stakeholders worry that a merger between Union Pacific and Norfolk Southern could cause short-term disruption. Many remember the service challenges that followed Union Pacific’s 1996 merger with Southern Pacific. I sure do, because I was there. I started at Union Pacific in 1998 as the network was beginning to recover. I was on the front lines switching cars and saw the impacts firsthand. It left a mark on customers, employees and regulators.

The comparison to today is understandable, but it overlooks three critical differences. 

First, Southern Pacific was a struggling railroad. By the mid-1990s, Southern Pacific was facing chronic crew shortages. Its locomotive fleet was too small, and the units it did have were in poor condition. Maintenance on main lines and yards had been slashed. Union Pacific leadership had a general sense they were getting a fixer upper, but the full scope of the operational challenges only became clear after the merger was underway.

That is not the situation today.

Union Pacific and Norfolk Southern are well-run railroads coming together from positions of strength. We both have modern safety systems, large capital investment programs and experienced Operating teams. We both have recent experience with large-scale technology upgrades and have navigated supply chain shocks, labor volatility and severe weather events.

Second, our technology is vastly better today. When I started my railroad career, for example, we lacked real-time visibility of our networks. We might not know about a problem until it had cascaded to other parts of the system. We often had to plan our responses based on incomplete information and had no way to test solutions. Even as recovery progressed, it was hard for us to know how we were doing.

Today every train is visible in real time. We know exactly where it is, whether it’s on schedule, whether crews are nearing legal work limits and dozens of other diagnostics. We can catch problems early and identify solutions before they become systemwide disruptions.

Another game-changing technology that did not exist in 1996 is our ability to use development environments to test the new system side-by-side with the old one, compare the results in real time, and make sure everything works before we flip the switch. The result is a shift from reactive crisis management to confident network design.

Third, connecting end-to-end networks is easier than consolidating them. The merger with Southern Pacific combined railroads operating in the same geographic region. Capturing the value of the merger meant consolidating parallel routes, integrating dispatch territories and eliminating duplicative infrastructure – all while dealing with a network in need of significant repair and maintenance.

The combination of Union Pacific and Norfolk Southern is fundamentally different. Our railroads operate in different parts of the country, with virtually no overlap. Most trains will continue running exactly as they do today. Most yards and terminals will see little change in activity. The biggest initial change will be to streamline traffic the railroads currently interchange, which will actually reduce opportunities for service disruptions while creating capacity at current interchange points. We can move slowly and deliberately, working in phases to ensure success. 

This will be the most carefully planned merger integration in railroad history. The partners are stronger, our technology is superior and the networks are entirely different. The result will be a smooth integration that provides customers with greater reliability, faster service and a lower cost structure.