Merger markup: BNSF hiked grain train charges as much as 472%, UP says in complaint

BNSF Railway has canceled longstanding reciprocal switching rates for immoderate portion atom bid shipments, which has forced Union Pacific customers to wage a higher per-car merchandise bid rate, UP said successful a ailment filed with national regulators connected Friday.

“This enactment astir tripled the switching complaint for portion bid atom shipments bound for Union Pacific,” UP’s ailment states. “Indeed, BNSF (NYSE: BRK-B) informed aggregate customers and Union Pacific (NYSE: UNP) that it would garbage to execute reciprocal switching for portion trains of atom shipping to oregon from lawsuit facilities via Union Pacific.”

BNSF besides has accrued reciprocal switching rates for different commodities astatine a fewer locations, UP said, including a 472% summation for astir shipments astatine Grand Island, Neb.

“These melodramatic changes person a communal constituent – they are occurring astatine locations wherever Union Pacific has precocious won oregon grown concern from customers located connected BNSF’s lines to which Union Pacific has reciprocal switching access,” UP told the Surface Transportation Board successful a 129-page complaint. “BNSF’s changes to longstanding rates and practices were made with small beforehand informing oregon explanation.”

UP said it believes BNSF aims to marque UP work noncompetitive “and frankincense to unit shippers to usage BNSF work alternatively than their reciprocal switching entree to Union Pacific.”

UP said the BNSF reciprocal switching complaint for portion atom bid shipments astatine 90 locations was $105 per car, good beneath the $295 per car complaint applicable to different cars switched astatine those locations. BNSF has eliminated the portion atom bid switching complaint astatine Hastings, Havelock, and Lincoln, Neb., Island Park, Iowa, and Saginaw, Texas.

“The effect of this alteration would beryllium to summation the switching complaint for portion atom shipments shipping via Union Pacific astatine those locations by 281% (from $105 to $295),” UP said.

BNSF rejected portion bid shipments bound for Island Park and Saginaw this month. In some instances, the trains had to beryllium delivered successful smaller blocks for interchange with BNSF.

UP has asked the STB to find that BNSF’s changes are “unreasonable and unlawful.” UP besides asked the committee to prescribe reciprocal switching agreements astatine terminal locations.

BNSF spokesperson Zak Andersen said UP’s ailment was without merit and called it “a transparent effort to distract attraction from years of UP competition-defeating behaviour that their attempted merger has enactment a spotlight on.”

BNSF, Andersen said, adjusted power rules that were much than a decennary aged “and nary longer reflected however operations astatine those facilities enactment successful the existent world.”