By Sabrina Valle
(Reuters) -The largest U.S. railroad union said Monday it will support Union Pacific’s $85 billion acquisition of Norfolk Southern, helping to advance a deal that surprised competitors and had been expected to face resistance from labor and regulators.
The endorsement marks a shift from the initial opposition by SMART-TD, the transportation division of the International Association of Sheet Metal, Air, Rail and Transportation Workers. When the merger was announced in July, the union said it would oppose the deal on concerns about job security, competition and infrastructure access.
SMART-TD said its members working in train and yardmaster services will have job protection for the length of their careers following the transaction.
“For generations, railroaders have worried about what mergers might mean for their jobs. Today, we can say with confidence that the biggest railroad and the biggest rail union in America are breaking new ground,” SMART-TD President Jeremy Ferguson said in a press release.
SMART represents roughly 230,000 workers across transportation, construction and manufacturing.
President Donald Trump also voiced support for the merger when he met with Union Pacific CEO Jim Vena in the Oval Office earlier this month, signaling regulatory openness to a deal by his administration. Such a merger would likely have faced tougher scrutiny under President Biden, whose administration had raised antitrust concerns about consolidation in the rail industry.
“We need better infrastructure, and rail is a big part of that,” Trump said.
The merger, if approved in what is likely to be a lengthy regulatory review, would create the first coast-to-coast freight rail network in the United States and would be the largest railroad acquisition in U.S. history.
It also puts pressure on rivals and particularly CSX Corp, which was caught off-guard and has been underperforming – and now finds itself in a vulnerable position to compete against a giant. The combined Union Pacific–Norfolk Southern network could offer shippers broader reach and pricing leverage across key domestic corridors.
Executives at CSX and BNSF, the two other major U.S. freight operators, had not been expecting the deal to gain traction so quickly, according to people familiar with the matter. The companies did not immediately respond to requests for comment.
A merger could prompt a strategic reassessment from Warren Buffett’s Berkshire Hathaway, which owns western freight carrier BNSF, according to sources familiar with the matter. Buffett has publicly stated he is not interested in acquiring another railroad and prefers operational partnerships over consolidation.
