August 4, 2025 - TRA Newswire - 

The announcement that Union Pacific will purchase east-coast Class 1 Norfolk Southern for $85 billion and create the first U.S. transcontinental railroad has large intermodal shippers in Texas and nationwide rethinking who their carrier of choice might be in the future.

Union Pacific would retain the name of the mega-railroad, which is all dependent on federal approval of the acquisition. The combined company would be valued at over $250 billion and could transform the entire U.S. supply chain. 

UP and NS are each other's largest interchange partners and exchange about one million carloads each year.

In a post on Freightwaves.com, it raised the question of three major intermodal customers whose containers you see on trains -- J.B. Hunt, Schneider, and STG Logistics - who are now in an awkward position of having their tents pitched in the wrong railroad camps.

According to the FreightWaves article, J.B. Hunt, the largest domestic truckload intermodal operator, uses BNSF Railway in the west and relies primarily on Norfolk Southern (NYSE: NSC) in the east. Containers for third-ranked Schneider and number four STG Logistics ride Union Pacific (NYSE: UNP) and CSX (NASDAQ: CSX) trains. This leaves the companies unable to tap the benefits of coast-to-coast single-line service should the merger receive regulatory approval. Rival and second-place Hub Group (NASDAQ: HUB) sits in the sweetspot, using UP and NS. 

Intermodal analyst Larry Gross is among the industry observers who believe that J.B. Hunt, Schneider, and STG ultimately will swap rail partners in the east. “I see it as inevitable because the one theoretical advantage of this merger is single-line haul,” Gross said. J.B. Hunt and BNSF have a permanent partnership, which means that its option for single-line service would be to jump to CSX. CSX already handles some J.B. Hunt traffic, generally in lanes that are not served by NS. Schneider, meanwhile, left BNSF for UP in 2023 and would be unlikely to return to BNSF, where it did not like playing second fiddle to J.B. Hunt. So it’s expected to shift to Norfolk Southern, according to the FreightWaves article.

“Railroads have been an integral part of building America since the Industrial Revolution, and this transaction is the next step in advancing the industry,” said Jim Vena, Union Pacific Chief Executive Officer. “Imagine seamlessly hauling steel from Pittsburgh, Pennsylvania to Colton, California and moving tomato paste from Heron, California to Fremont, Ohio. Lumber from the Pacific Northwest, plastics from the Gulf Coast, copper from Arizona and Utah, and soda ash from Wyoming. Right now, tens of thousands of railroaders are moving almost everything we use. You name it, and at some point, the railroad hauled it.” Vena will continue as CEO of the company.

Texas shippers, like others across the country, have concerns over the UP-NS merger. Some of the concerns center on higher rates due to less competition, while proponents cite potential faster and more reliable service. 

A dedicated website providing information about the transaction is available at 
www.up-nstranscontinental.com

Photo credit: JB Hunt