Revised UP-NS Data Reveals 1.5 Million Load Diversion in Landmark Rail Merger

UP-NS merger traffic diversion estimates have been revised. Union Pacific and Norfolk Southern now use a fuller data set. It more precisely shows freight that could move from competing railroads to the proposed system. This is reported by the railway transport news portal Railway Supply.

The combined network would attract 1.535 million net rail and highway loads. That is only 1% above their first merger filing in December 2025 projection.

Still, the revised filing changes the traffic mix more than the net total.

The expanded Union Pacific is projected to capture more intermodal loads from other railroads. The increase is 49% above the earlier estimate. Merchandise diversions declined by 25%. The truck-to-rail intermodal estimate increased by 3% from the original filing.

Fuller Class I data reshapes UP-NS merger traffic diversion

Union Pacific and Norfolk Southern attribute the revisions to a broader traffic analysis. The latest work uses complete traffic data from all six Class I railroads. The original application used data from four Class I railroads. In the earlier filing, gaps were filled using the Surface Transportation Board’s waybill sample. The railroads say the fuller data set allowed more precise estimates.

The expanded data also allowed better waybill matching. Those waybills formed single interline moves. The railroads said this mattered especially for Chicago intermodal shipments. Those shipments used rubber-tire crosstown transfer. Earlier data did not always identify two single-line waybills as one interline move.

Under the new analysis, more traffic was classified as interline. The increase was about 1.1 million merchandise carloads and 2.1 million intermodal units. That enlarged the traffic pool eligible for diversion.

BNSF replaces CSX in projected traffic losses

The revised merger application also changes which rival railroad appears most exposed to traffic losses. BNSF Railway now replaces CSX in that position. It is projected to lose the most traffic to a combined UP-NS system. Also, BNSF’s expected losses rose to 303,000 loads from 246,000. CSX’s estimate fell to 244,000 loads from the earlier figure of 249,000.

BNSF’s change is tied mainly to intermodal traffic. The fuller data enabled UP and NS to connect Chicago rubber-tire interchange movements. Those movements had not previously been stitched together in the same way. BNSF’s projected intermodal losses rose to 211,000 from the earlier estimate of 138,000.

The percentage comparison also changes. CSX and BNSF switch positions. CSX could see 4% of its traffic shift to UP. Meanwhile, BNSF could see 3.4% of its volume move to UP. For CSX, the losses mainly involve existing interline moves. Those moves already include either UP or NS. They do not primarily reflect new traffic captured from CSX by the expanded UP network.

CN and CPKC revisions

Canadian National’s position improves substantially in the updated analysis. Separately, projected diversions fall by 59%, to 13,000 per year. CN had been the most outspoken critic of the December estimates. It argued that they were based on “phantom carloads.” UP and NS say the complete traffic data removed that issue.

Also, the estimate for CPKC declined. The first application combined loads moving on Canadian Pacific. It also included loads moving on Kansas City Southern and KCS de Mexico. UP and NS said this likely counted some loads two or three times. Under the revised analysis, projected CPKC diversions to UP fall by 22%. They drop to 25,000 from 32,000.

Truck-to-rail diversion and watershed traffic

UP and NS say a merged system would attract an estimated 404,000 rail carloads annually. It would also attract 1.58 million intermodal units. Together, that would equal 1.98 million total loads. They say that total would come from offering the single-line service customers prefer.

Of that total, UP and NS identify:
• 508,000 loads from existing rail traffic using other railroads either partly or entirely;
• 1.2 million loads from intermodal traffic now moving by truck;
• 193,000 loads from merchandise traffic now moving by truck;
• 70,000 extensions of intermodal moves currently drayed more than 250 miles.

In addition, the railroads say this would raise combined UP-NS traffic by 13%. The comparison uses the 2023 base year.

Overall, UP and NS estimate that 2.1 million trucks would be removed from highways annually.

How the figures differ?

The traffic-diversion figures used in the filing refer to different measurements. For example, the 2.1 million figure counts truckloads removed from highways. It uses a one-for-one highway count. The 1.98 million figure converts that truck traffic into rail units. One railcar can replace more than one truck. Still, the 1.535 million figure is the net total. It excludes moves that would only lengthen an existing rail haul. Those moves would not shift new freight onto rail.

More than half of expected merchandise and bulk truck diversions involve new single-line service. Also, those diversions are to, from, and within the watershed region. In the filing, the watershed means areas within 250 miles of the Mississippi River. It functions as the practical boundary between Eastern and Western railroads.

Rail’s share in that watershed area has been limited by interchange friction. Meanwhile, disputes over short-haul revenue division have also limited it.

News on railway transport, industry, and railway technologies from Railway Supply that you might have missed: