Klobuchar Statement On Canadian Pacific Ending Merger Efforts With Norfolk Southern
As a long-time leader and ranking member of the Senate Judiciary Antitrust Subcommittee, Klobuchar has repeatedly raised concerns about the negative impact on consumers of increased consolidation in the railroad industry
Since 1980, number of class one railroads in U.S. has gone from 26 to 7; today 90 percent of the freight traffic is handled by only four railroads
WASHINGTON, DC – Today, Senator Amy Klobuchar issued the following statement on Canadian Pacific Railway announcing it is ending its effort to merge with Norfolk Southern Railway. Klobuchar has repeatedly raised concerns about the negative impact on consumers of increased consolidation in the railroad industry. Since 1980, the number of class one railroads in the U.S. has gone from 26 to 7, and today 90% of freight traffic is handled by only four railroads.
“Significant consolidation has already occurred in the railroad industry, and today 90 percent of freight traffic is handled by only four railroads,” Klobuchar wrote. “This announcement today from Canadian Pacific is welcome news for consumers. Competition leads to lower prices, higher-quality service, and innovation, and why I have led efforts to protect consumers from further consolidation.”
Last month, Klobuchar and Senator Mike Lee (R-UT), the ranking member and chairman of the Senate Judiciary Subcommittee on Antitrust, Competition Policy, and Consumer Rights, urged the Department of Justice (DOJ) to weigh in with the Surface Transportation Board (STB) on the voting trust that Canadian Pacific Railway intended to use in its proposed acquisition of Norfolk Southern Railway. Last week, following Klobuchar’s call, the Department of Justice determined that Canadian Pacific’s proposed voting trust “risks irreversible harm” to competition. In December, Klobuchar raised concerns about the merger proposal in a letter to Attorney General Loretta Lynch and Surface Transportation Board Chairman Daniel Elliott. Klobuchar said one of the most concerning aspects of the potential merger is that the railroad’s current antitrust exemption prevents the Department of Justice (DOJ) from blocking the merger even if it is predicted to harm competition. Klobuchar has introduced legislation to repeal the outdated and anticompetitive antitrust exemption for railroads and make railroad mergers subject to full antitrust scrutiny by the Department of Justice. In 2014, Klobuchar raised competitive concerns about Canadian Pacific Railway’s proposed acquisition of CSX, a merger that was later abandoned.