By James Shefelbine
James Shefelbine, a principal at PraxiChain Consulting, with over 30 years of railroad industry experience, shared nuanced perspectives on Union Pacific’s bid to acquire Norfolk Southern during a recent DC Velocity podcast appearance.
Background and Concerns
Shefelbine, whose background spans roles at Burlington Northern Santa Fe, CSX Transportation, and RailAmerica, expressed mixed reactions to the proposed coast-to-coast freight railway merger.
“My reaction is honestly mixed,” Shefelbine said, noting that healthy skepticism from industry groups is warranted. He highlighted concerns from shipper organizations, including the National Industrial Transportation League and American Chemistry Council, who worry about reduced competition and higher rates.
“When you go from four Class I railroads to two transcontinental systems, shippers lose fifty percent of their competitive options,” he explained, echoing concerns from his colleague Karen Burchfield about past merger outcomes where cost savings stayed with railroads rather than benefiting customers.
Potential Benefits
Despite concerns, Shefelbine acknowledged compelling operational advantages, particularly the elimination of interchange delays. Citing Union Pacific CEO Jim Vena’s point about removing touchpoints, he noted: “Every time there’s a touch point, you add 24 to 36 hours… That’s gone.”
The environmental benefits are also significant, with “one intermodal train removing more than 550 trucks from the highway and being 75% more fuel efficient than truck.”
Regulatory Timeline
Regarding federal approval, Shefelbine outlined a lengthy process ahead. With the formal application expected by early 2026 and an estimated 19-22-month STB review, “if everything goes smoothly, we might see a decision by late 2027 or early 2028. But given the opposition we’ve already discussed, I wouldn’t bet the ranch on ‘smoothly.'”
Notably, this will be the first major Class I merger reviewed under the stricter 2001 STB regulations, which require railroads to prove their merger will “enhance competition” rather than merely preserve it.
Bottom Line
Shefelbine’s analysis reflects industry-wide ambivalence: “If they can genuinely deliver seamless coast-to-coast service while keeping pricing competitive, this could transform American manufacturing’s global competitiveness. But if it’s just another consolidation play that reduces competition, we’ve learned nothing from past mistakes.”
Listen to the full podcast here: Logistics Matters with DC Velocity | DC Velocity
Contact PraxiChain to discuss how your organization can strategize in advance of merger realities to minimize risk and formulate negotiation initiatives.
