Intermodal, Drayage & Chassis
Special Report
Potential logjams
More than $ 2.1 billion in capital spending outlined in the merger application would set the stage for faster transits for some shippers, but increased volumes could overwhelm certain inland terminals and disadvantage some customers. UP said it will spend $ 507 million on a host of rail infrastructure upgrades across what would be the newly combined network and $ 516 million to upgrade or expand a dozen terminals expected to see a surge in containers, automobiles and manifest trains should the merger happen.
Fresh investment will go into supporting a new singleline train from Southern California to New Jersey through Kansas City, bypassing Chicago. The railroad plans to invest $ 58 million at UP’ s Inland Empire intermodal terminal in Southern California, where daily lifts are projected to rise by roughly 400 %.
NS terminals in Cincinnati and Toledo, Ohio, are expected to see daily lifts more than double within three years of the merger, prompting a combined $ 52.5 million in planned investment. In Council Bluffs, Iowa, where lifts are projected to increase 163 %, UP plans to spend $ 75.4 million to expand capacity.
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The combined railroad would also invest $ 136.6 million in track infrastructure upgrades between Kansas City and Butler, Indiana, to support faster Southern California-Northeast intermodal trains and $ 172.3 million between New Orleans and Atlanta to support service to and from Houston and Laredo, Texas. The money will go to more than 20 projects to improve the tracks and bridges in those areas to handle the additional post-merger volume.
However, there are several intermodal terminals that would see a similarly sharp increase in volume but receive little or no investment.
Container lifts at the Twin Cities Intermodal Terminal in Minneapolis, for example, are projected to increase 343 % following the merger, exceeding capacity, yet no terminal upgrades are planned. Back in March, just a few years after hundreds of millions of dollars were poured into the facility, UP said there was still“ ample capacity remaining for future expansion” despite intermodal volumes surging 94 % year over year in 2024.
Instead, congestion mitigation efforts in Minneapolis will include working with customers to reduce container dwells and exploring off-site parking options, UP wrote in the application.
February 2, 2026 | Journal of Commerce 13