WASHINGTON — The Society of the Plastics Industry Inc. and the Chemical Manufacturers Association officially have opposed the takeover of Eastern railroad Conrail by CSX Corp. and Norfolk Southern Corp.
The opposition is not a surprise, and comes after Washington-based SPI voiced concerns this summer that CSX and Norfolk Southern were paying too much for the railroad and would charge shippers more to make up that cost.
Shippers ``should not be asked to bear the very substantial risks'' from the bidding war between the two railroads, SPI and CMA, also of Washington, said in an Oct. 21 filing to the Surface Transportation Board, which must approve the merger.
The railroads will be able to pay for the purchase only if they ``faultlessly execute their strategy of increasing traffic while cutting personnel and costs substantially,'' according to the trade associations. ``It is doubtful this can be done,'' they said.
SPI opposed the earlier merger of Union Pacific and Southern Pacific, while CMA did not. Both CMA and SPI now are protesting service problems on the UP-SP system.
Norfolk Southern officials said they will not comment on the matter until they file a response with STB in December.