The prospect of a Union Pacific-Norfolk Southern (UPNS) rail merger does not faze BNSF CEO Katie Farmer. She says she would rather invest in a better railroad than in a rail merger.
Farmer was speaking at the Intermodal Association of North America (IANA) EXPO 2026 on September 15th at Long Beach, California.
Framer’s response: “I think that it's really telling that people continue to ask me the question: Will we go out and acquire CSX if this merger goes through? I think stop and ask, why are people asking me that question? What it tells us is that they recognize that if this consolidation is allowed to go through, it's going to create a competitive dynamic that's not sustainable. And so, I guess I'd ask you the question: “Would you rather have me spending billions of dollars on building a [state-of-the-art rail] facility like Barstow, California, or $85 billion on a transaction [that] I'm not sure what we're solving?”
Farmer said BNSF would continue to make the Barstow, California rail facility investment and other investments that grow the railroad based on a customer service strategy that enhances partnerships that make BNSF a better railroad.
The sentiment at BNSF is that Union Pacific is far more driven by the need to cut costs and increase returns for stockholders rather than invest in its rail and intermodal operations, customers, and employees. The BNSF view appears to be that the Union Pacific-Norfolk Southern proposed merger exemplifies cost cutting rather than investment.
Farmer asserts: “We will continue to compete as a railroad regardless of what happens. We have the fastest, most capacity in the industry. We will continue to collaborate … so we'll show up ….and we'll continue to compete.”
Partnership With CSX
One example is the collaboration with the CSX railroad that BNSF started ten years ago and that functions without the need for an $85 billion merger: “We’ve been collaborating with CSX … to be able to drive the best intermodal service that we can. When I was running intermodal for BNSF, I contacted my counterpart at CSX, and we put together our seamless service. We run our power, our locomotives. We have a step-on, step-off of the crew, and we go into Atlanta, and we market as if it's a BNSF direct into Atlanta. And as I said, that was 10 years ago. We also did the same thing in Northwest Ohio. We saw that as a large market. We were talking to … big customers telling us, ‘we need a better service into Northwest Ohio.’ We are offering now with CSX a service from LA /Long Beach to Charlotte, to Jacksonville. And we have a… service from Kansas City to New York and the Ports of New York, New Jersey.”
Peak Season Challenges
Farmer was asked how BNSF was handling peak season challenges, especially since importers seeking to mitigate the impact of new Trump administration tariffs had started to import goods from abroad much earlier in the year than in the past so as to avoid new US tariffs.
Rather than worrying about the uncertainties, Farmer’s response was to say BNSF focuses on the fundamentals: “I love peak. The key is we started decades ago to put ourselves in a position to be the preferred carrier for our parcel customers. And that starts with infrastructure investment. You can't hit the levels of service and have the recoverability that you need unless you make decades-long investment in capacity. We have a railroad at BNSF that has done that … We have invested in innovation and technology. The key is we start early in the year, and we meet with our parcel customers’ folks. We go to each of their sort facilities, we sit down, we try to understand what demand is going to look like for peak. And so how that translates for us [to meet] …the stress test, how that allows us to ensure we have the capacity we need … looking in June, July, August, September, what's peak going to look like? We are able to put additional train schedules in and utilize that capacity that we built decades ago to be able to deliver.”
She cited one example: “Last year we moved 80 million parcel packages between Thanksgiving and Christmas Eve. Wow! Eighty million parcel packages without a single failure. And that was 9% more than the year before. The way we did that is we added about 70 additional train schedules. And we did that because we sat down, we understood our customer's business, we had the capacity, we had the technology, we had what we needed to be able to deliver.”
Fun?
Farmer said the focus on the fundamentals includes a “commitment over time …is the people. One of the most fun things is when we start the week of Thanksgiving, it seems like peak gets earlier and earlier every year…When we start Thanksgiving, we have 35,000 employees that are making sure every handoff, every single thing we do, we're getting that unit down … we're getting it to the sort-facility, and we're getting it on time for our customers.”
Then there is the countdown to delivering every package by Christmas Eve, which Farmer described as “fun,” explaining: “I don't even want to tell you how many Christmas Eves I've been sitting there waiting for that last unit to ground to make sure we have a perfect parcel peak, but it's fun … it’s the reason I've done what I do for 35 years.”
Technology
Farmer said the investment in technology is a big priority at BNSF: “When I became CEO six years ago, one of the things that I realized very quickly was that given the customer base that BNSF has … we weren't responding quickly enough with our technology. We are a company of builders. We have 35,000 miles of track. We have thousands of locomotives and equipment. But we were relying on commercial solutions to solve those problems. And … that's not good. And frankly … when you're working with customers like Amazon …. they’re not going to wait around for you to figure out, ‘let me write an RFP, let me send it out, let me get this back.’ You have to create fast … and understand. And so, we hired a new chief technology officer ... He is frankly a talent magnet. He's very well respected in the industry. And we have hired hundreds of technologists, operations research folks, data scientists that are literally sitting … next to our network operations folks, next to the folks that are impacting intermodal, our operation.”
Intermodal & J.B. Hunt
Farmer says the investment in intermodal is a constant process and cites its partnership with trucking giant J.B. Hunt: “We're giving customers intermodal use cases, saying, how do you use intermodal? They wanted that door-to-door product. They wanted truck and rail combined. And so, I've been … really excited about the progress that we've made with J.B. Hunt and our customers because we're offering a 95% or better on-time service door-to-door. They don't have to worry about whether it's truck or rail. And we have a unique relationship that provides seamless service that we're offering customers on a door-to-door basis.”
