The U.S. rail industry could soon be approaching a watershed moment in the form of Union Pacific's planned $85 billion mega-merger with Norfolk Southern. But can the merger actually pass muster with federal regulators, and will it deliver on its lofty promises to shippers? The answers to those questions largely depend on who you're asking.

Speaking at 2026's Agriculture Transportation Coalition conference in Tacoma, Washington, on May 20, UP VP of intermodal Ryan Steinbach seemed confident in the future of the merger itself, despite the Surface Transportation Board rejecting the company's initial application in January.

"What we’re anticipating is the merger will be approved, and by July or August of 2027, the new company will start," Steinbach said.

The proposed merger's path to this point has been anything but smooth. When the STB rejected UP's application, the board flagged concerns over a lack of projected market-share data provided by UP and Norfolk, as well as a failure to include a copy of the full agreement. According to Steinbach, those concerns have since been addressed in the updated application the railroads submitted in April 2026, which now includes up-to-date projected market-share figures, additional competitive analysis and the full merger agreement requested by regulators.

Dubbed the "Great Connection" by UP and Norfolk, the transcontinental railroad that would be formed as a result of the merger would be the first of its kind operated by the single company in the U.S. Data provided by UP claims that the merger would create $3.5 billion annual savings for shippers, make rail more competitive with long-haul trucking, and eliminate the need for time-consuming east-west interchange points along the Mississippi River, where cargo is passed from western railroads like UP and BNSF, to eastern operators like Norfolk and CSX. 

“It’s going to raise the bar for the whole entire industry," Steinbach said, adding that the merger would force railroads across the country to improve service speeds, reliability and overall competitiveness in order to keep pace with the newly combined network.

Others, however, remain skeptical.

"If the merger happens and the growth projections that are out there hit, this railroad will be a monster," said BNSF commercial and marketing support VP Adam Weisskittel, in his own presentation following Steinbach's at AgTC. 

Weisskittel argued that the merger could actually reduce competitive shipping options, given that the combined UP-Norfolk network would control roughly half of all U.S. rail shipments. With fewer options to choose from, shippers could potentially see their rates go up, and could soon face major service disruptions that mirror those scene in the wake of previous Class I railroad mergers. In one example cited in a Wayne State University analysis, a 1996 merger between UP and Southern Pacific was found to have doubled rail freight transit times, and led to deteriorated rail performance across nearly all metrics. 

Weisskittel also expressed doubts over whether the STB would even approve UP's updated application, given that multiple parties — including BNSF — have already urged regulators to reject the filing for a second time over unresolved competitive and regulatory concerns. 

"I think if the STB wants to reject it, there are certainly grounds to do it," he opined.

BNSF further questioned whether UP and Norfolk can realistically achieve the growth projections tied to the merger, with Weisskittel noting that the combined railroads have collectively shrunk their freight volumes over the last two decades even as they've pushed for higher pricing. He pointed to growing political and industry opposition that could threaten the future of the merger as well, with dozens of lawmakers, agricultural groups and labor unions having publicly raised concerns about its potential impacts on competition and freight rates.

Currently, the STB has until May 30 to determine whether it will formally accept UP's revised application. If the board does accept the application, the merger would move into the STB's formal review process, which would include a period for public comments and hearings involving rail and shipping industry stakeholders. The STB would then issue its final decision sometime in late May of 2027.