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Despite Trump’ s support, nearly 50 Republicans in Congress wrote to the STB expressing concerns about the UP-NS mergert. Rexjaymes / Shutterstock. com

Potential new US tariffs cloud sourcing strategies, peak season demand

By Eric Johnson

merger“ unnecessary” and asking the DOJ to“ scrutinize and, if appropriate, oppose the deal.”

Jon Gabriel, group vice president of consumer products for BNSF, said broad opposition to the deal proves the outcome is not pre-determined.“ There are many lawmakers that have sent letters to the administration voicing concern or opposition; most of them are Republicans. So clearly, the fix is not in,” Gabriel said at TPM26.

Still, there are plenty of stakeholders supporting the deal. Union Pacific’ s initial application included more than 2,000 letters of support, with more than 500 being from customers and 800 from public officials and community leaders.

Supporters include the Port of Los Angeles, ocean carriers Ocean Network Express and SM Lines, and domestic intermodal partners Hub Group and Knight Swift Transportation.

On the other hand, major rail competitors currently oppose the deal, including BNSF Railway, Canadian Pacific Kansas City, Canadian National and CSX Transportation. Their primary concern is that a combined railroad would create an entity so large that a service disruption could ripple across the broader North American network.

Opponents also argue that many of the operational improvements highlighted by supporters could be achieved through stronger cooperation between railroads, and East Coast ports could lose traffic under a merged UP-NS network.

“ We have a pretty competitive port structure that allows for lots of different service options in different ports,” Carl Bentzel, president of the National Association of Waterfront Employers, told TPM26.“ There is a legitimate and profound concern on foreclosure of business opportunity and long-term consolidation in ports.”

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Importers buoyed by a February US Supreme Court decision that overturned billions of dollars of tariffs they paid are now coming to grips with a new wave of tariffs that are likely to burden their inventory replenishment and holiday shipping plans.

The US Trade Representative( USTR) launched two separate Section 301 investigations in early March, covering a total of 60 countries: one related to“ structural excess capacity and production in manufacturing sectors” and a second aimed at forced labor. Should the investigations result in additional tariffs— widely expected to be the outcome— those duties will heap more cost pressure and customs administrative work on US importers, as well as reduce the appeal of sourcing from countries seen as lower-tariff alternatives to China.

More immediately, the tariffs could land just as US retailers typically begin peak season ordering ahead of the winter holidays.

“ This administration appears keen to retaliate first and discuss mostly later.”

That will have an impact on containerized US import market share. Vietnam, for example, saw its share of inbound US volumes rise to 12 % in 2025 from 9.9 % in 2024, mostly at the expense of mainland China, whose share fell to 36 % from 40.4 % in 2024, according to PIERS, a sister product of the Journal of Commerce within S & P Global.

The two sets of investigations can be viewed as the Trump administration clearly pivoting from tariffs assessed through executive order, by way of the International Emergency Economic Powers Act( IEEPA), to ones with a more straightforward track record of surviving legal challenges. The Supreme Court on Feb. 20 ruled that the IEEPA tariffs had been levied illegally, and the US Court of International Trade has ordered US Customs and Border Protection to create a process to refund importers more than $ 160 billion in tariffs they paid, plus interest.

Trade experts said they expected the administration to quickly use other tools to progress with its tariff-focused foreign trade policy in the event the IEEPA tariffs were struck down.

The structural capacity investigation will look into whether 16 different countries or trading blocs, including

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