The president and CEO of the Alliance for Chemical Distribution (ACD), Eric R. Byer, released a statement opposing the $85 billion merger between Union Pacific and Norfolk Southern. Byer also encouraged the Surface Transportation Board (STB) to block the deal.

The merger, which was announced on July 29, would create what Union Pacific is calling “America’s first transcontinental railroad,” consisting of a single rail network that would span approximately 50,000 miles across 43 states from the East Coast to the West Coast. In an article published about the merger, the New York Times stated that "the deal would put around two-fifths of rail freight in the hands of one company."  

Byer warned that further consolidation in the already concentrated freight rail industry would worsen service issues and raise costs for chemical distributors, who rely heavily on rail to transport essential products. He said in the statement, "Following prior rail mergers, freight rail has not served the needs of its customers who inevitably pay increasingly high rates for unreliable and inadequate service. Despite persistent deteriorating rail service, railroads are rarely held accountable for supply chain disruptions caused by extensive monopolies and an outdated regulatory system."

Byer then urged the Surface Transportation Board (STB) to reject transcontinental rail mergers that prioritize corporate profits over competition, efficiency, and the public interest. He stated, "The STB must ensure that freight rail customers have access to competitive, efficient, and reliable rail service. Approving a transcontinental mega-merger will benefit the merging rail companies and Wall Street, at the expense of U.S. chemical distribution companies who are critical contributors to the American economy. It is hard to see how expanding railroad monopolies would meet the STB’s high burden to 'enhance competition' and serve the 'public interest.'"

Learn more about the Alliance for Chemical Distribution at www.acd-chem.com. 

To get all the news about materials handling and processing in the adhesive and sealant industry, click here.