CN's Robinson Casts Doubt on UP-NS Merger Viability, Demands 'Significant' Concessions

MONTREAL — The proposed mega-merger between Union Pacific and Norfolk Southern faces a steep climb to regulatory approval, according to a top industry executive who has scrutinized the initial filing. Canadian National Railway CEO Tracy Robinson stated bluntly that the application falls "considerably short" of addressing fundamental competition concerns, signaling fierce industry resistance to the deal that would reshape North American railroading.

"The transaction, as currently proposed, leaves critical questions unanswered regarding its negative impact on competition," Robinson told analysts during CN's quarterly earnings call on Thursday. "The concessions required to achieve this will be significant. This should be the focus as UP and NS prepare their refiling."

Her comments come weeks after the U.S. Surface Transportation Board (STB) rejected the railroads' initial December application as incomplete, citing missing analyses. Robinson's critique provides the first detailed look at the substantive objections major competitors are likely to raise.

The CN CEO took aim at several core aspects of the proposal. She noted the application lacked projected market share data for the combined entity, making it impossible to assess potential harm from increased market power. She also argued it misleadingly portrayed the merger as purely "end-to-end" despite clear operational overlaps between the two networks.

Perhaps most damning was Robinson's assessment of the proposed remedies. "It failed to propose conditions that would adequately preserve competition," she said, dismissing the suggested open gateway model as "proven not to work." She added that gateway commitments, by CN's assessment, would cover only a "very small fraction" of impacted traffic and exclude Canadian railways entirely.

The implications for shippers and connecting railroads are a central concern. Robinson argued that a full understanding of these impacts would necessitate "a much more substantive portfolio of concessions" to mitigate them, especially under the STB's stricter merger rules adopted in 2023.

While CN assesses its own exposure as less than that of other railroads, Robinson was clear: "The impact... won't be zero." She pledged that CN would "rigorously pursue concessions" to protect and improve competition if the merger proceeds.

Highlighting the deal's magnitude, Robinson revealed CN has engaged outside advisors to evaluate the merger and potential industry consolidation, a move she described as essential for understanding an "industry-changing deal" without disrupting daily operations.

Industry Reaction:

"Robinson is spot-on," said Michael Thorne, a logistics manager for a major agricultural shipper in Omaha. "This isn't just about two railroads. It's about whether the STB will hold the line on preserving real competition. The gateway promises so far feel like a fig leaf."

"This is predictable protectionism from CN," countered David P. Ellis, a transportation consultant formerly with a Class I railroad. "They're trying to dictate terms and extract concessions before the review even properly begins. The focus should be on creating a more efficient network, not protecting every incumbent's turf."

"The level of detail Robinson demands is exactly what was missing before," noted Dr. Arlene Chen, a rail policy professor at the University of British Columbia. "Her statement is a roadmap for the STB's concerns. UP and NS now have a clear, if daunting, checklist for their refiling."

"She's calling their bluff," said Javier Mendez, a union representative for rail workers in Chicago, his tone sharp. "They talk about efficiency and competition, but this is about power—pure and simple. It's a monopoly play, and Robinson just exposed the empty promises in their filing. Shippers and workers will pay the price if this gets rubber-stamped."

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