TRRA and the Union Pacific–Norfolk Southern Merger

Service

The Terminal Railroad Association of St. Louis (TRRA) has drawn some attention as part of our proposed combination with Norfolk Southern. It's an important part of the U.S. freight rail system - there's no question about that. What's less clear is why critics are focusing on it so heavily. In our view, it's being used to try to block a merger that will actually increase competition. A basic understanding of how terminal railroads - and TRRA specifically - work helps explain why.

Katie Novak, General Director-Interline Operations, Network Planning and Operations

TRRA is a shared rail facility in the St. Louis area that's jointly owned by the Class I railroads: Union Pacific, BNSF, Canadian National (CN), CSX and Norfolk Southern. All of these railroads - along with Canadian Pacific Kansas City (CPKC), which connects to it - use TRRA to exchange freight in and around St. Louis.

Facilities like TRRA exist because they have to. The U.S. rail network is made up of many different companies, and they need places to connect and hand off freight to each other. It wouldn't be practical - or even possible - for every railroad to build its own tracks and terminals everywhere those connections are needed. So instead, they share key facilities like TRRA.

To keep freight moving efficiently across the country, these shared facilities must operate fairly. If one railroad were given special treatment, it might help them in the short term, but it would quickly create bottlenecks and slow down the entire network. There are also practical concerns: railroads are less likely to invest in shared infrastructure if they don't fully control it, and having multiple operators trying to run the same space can create safety risks. Terminal railroads solve these challenges by providing neutral, coordinated operations that work for everyone.

That neutrality isn't just a good idea - it's built into how these companies are set up and governed. Terminal railroads are required to treat all users fairly, regardless of ownership stakes. In fact, TRRA's structure was specifically shaped by a U.S. Supreme Court decision in 1912 to ensure it operates in a non-discriminatory, pro-competitive way.

You see the same principles at work in other shared rail operations, like the Kansas City Terminal Railway (KCT) and TTX Company, which manages rail car pooling. These organizations are designed - and closely overseen - to support competition, not limit it.

Real-world examples show this model works. In Portland, the Portland Terminal Railroad Company (PTRC) - majority-owned by Union Pacific, with BNSF as a partner - has supported BNSF's independent operations for decades. BNSF has leased and expanded its intermodal ramp at PTRC's Guilds Lake Yard multiple times since the late 1980s, growing its own competing service in the market even without majority ownership.

Similarly, in California, the Central California Traction Company (CCT), jointly owned by Union Pacific and BNSF, has operated successfully as a shared facility serving the Port of Stockton since the late 1990s. The two railroads have coordinated how traffic moves across the network - including routing all CCT traffic through BNSF's Stockton terminal - while continuing to compete for customers. CCT acts as a neutral operator for switching and maintenance, showing how shared infrastructure can function efficiently over the long term.

Despite all of this, some competitors claim that if Union Pacific and Norfolk Southern combine, it will somehow change how these terminal railroads operate. Such a concern is not justified. These organizations are set up specifically to prevent that kind of outcome.

Still, we've gone a step further to address any possible concerns. We've committed to giving up ownership stakes and governance rights that could theoretically be seen as influencing these shared entities. These are practical, good-faith solutions. The fact critics continue to raise concerns despite these concessions suggests the real issue is opposition to the merger itself - not the operations of TRRA or similar organizations. In fact, a special meeting was called to discuss TRRA and the other owners refused to show up.

At the end of the day, terminal railroads like TRRA - and companies like TTX - have a long track record of operating fairly and supporting competition, even when ownership stakes vary. The safeguards built into their structures, combined with our additional concessions, ensure they will continue to serve as neutral, reliable connectors in the national rail network.

We're looking forward to moving the conversation back to the bigger picture: the benefits of creating a more competitive, efficient transcontinental railroad network.

Get the facts at AmericasGreatConnection.com.

Please review Union Pacific's cautionary note regarding forward-looking statements.