ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, June 4, 1996 TAG: 9606050024
SECTION: BUSINESS PAGE: B-6 EDITION: METRO
Federal government opposes rail merger
WASHINGTON - The Agriculture, Justice and Transportation departments objected Monday to the proposed Union Pacific-Southern Pacific railroad merger on grounds it would reduce competition and raise prices.
In the toughest comments, the Justice Department estimated the deal could cost consumers $800 million a year in higher prices and urged a federal panel to kill the merger as too flawed to remedy.
The Agriculture Department said the $5.4 billion merger would likely push up freight costs enough to harm farmers and leave U.S. exporters less competitive in foreign trade. Because Union Pacific did not accept Agriculture's earlier recommendation that it sell off rail segments from the Midwest to the Gulf and to the West Coast, USDA also opposed the deal now.
The Transportation Department added its opposition to the merger but argued problems of reduced competition for rail freight customers still could be solved if portions of the combined line were sold off to other railroads.
The proposed merger would create the largest railroad in the United States with more than 35,000 miles of track. Union Pacific Corp. says its purchase of Southern Pacific Rail Corp. would save the railroads more than $750 million annually and improve western freight service.
- Associated Press
Domestic coal production falls
CHARLESTON, W.Va. - Domestic coal production fell 3 percent to 18.9 million tons during the week ended May 25 from 19.4 million tons the week before, the U.S. Department of Energy said Monday.
The U.S. coal industry produced 18.9 million tons in the same week last year, according to the department's Energy Information Administration.
Virginia mines produced 624,000 tons during the survey week, down from 654,000 tons the week before and from 728,000 in the corresponding week of 1995.
Domestic coal production so far this year is 413 million tons, 1 percent behind last year's production at this time
- Associated Press
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