Montana Attorney General Austin Knudsen led a coalition of attorneys general in urging the United States Department of Justice (USDOJ) to review the proposed merger between Union Pacific and Norfolk Southern freight-railroad companies, which will stifle competition and increase costs for Americans.
The letter asks USDOJ Acting Assistant Attorney General Omeed Assefi to review the proposed merger as the agency’s analysis could provide the Surface Transportation Board (STB) with necessary scrutiny while the Board considers the approval of the transaction. A preliminary review by the attorneys general found the companies have failed to adequately address the clear loss of horizontal competition, raising antitrust concerns.
“By entrenching a single rail behemoth across key east-west corridors, the deal would shackle domestic manufacturers, energy producers, and farmers with higher rates and fewer shipping options, thereby blunting their competitive edge against foreign rivals, squeezing household budgets, and weakening the supply chains that underpin our national security,” Attorney General Knudsen wrote in the letter. “Accordingly, we encourage the Department of Justice Antitrust Division to carefully scrutinize the merger, applying the existing law and merger guidelines to support the Surface Transportation Board’s review of the transaction.”
The merger could reduce shipping options by limiting cooperation with other railroads for interline services, which raises questions of whether the railroad companies’ commitment to keeping connection points open for freight and railcars is truthful, given it is not enforceable. Although Union Pacific claims the merger will result in increased growth and efficiency, the attorneys general also highlighted the importance of DOJ’s review of the deal considering the company’s nearly decade-long decline in rail service.
Attorneys general from Iowa, Kansas, Mississippi, North Dakota, South Dakota, and Tennessee also joined the letter.
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Office of Montana Attorney General
