Union Pacific (NYSE:UNP) and Wabtec (NYSE:WAB) have entered into a $1.2 billion agreement to modernize Union Pacific’s AC4400 locomotive fleet, the companies announced in a press release.
The deal, signed in the fourth quarter of 2025, focuses on upgrading existing locomotives to enhance operating efficiency and overall fleet performance. It represents Union Pacific’s fourth large-scale locomotive modernization order placed with Wabtec since 2018.
Once upgraded, the locomotives are expected to deliver meaningful performance gains, including a 5% reduction in fuel usage, a 14% boost in tractive effort and an 80% improvement in reliability. Each unit will be equipped with Wabtec’s FDL Advantage engine upgrade, LOCOTROL Expanded Architecture and a new Modular Control Architecture.
“We are committed to delivering the service we sold to our customers and one way we do that is having great American-made locomotives that can get the job done,” said Jim Vena, Union Pacific CEO. “These redesigned locomotives will be just like new, providing the improved fuel efficiency and enhanced reliability that we need to grow with our customers and to win new business.”
The modernization program is designed to extend the service life of each locomotive while improving fleet standardization across Union Pacific’s network. Manufacturing and upgrade work will be carried out at Wabtec’s facilities in the United States, with deliveries scheduled to begin in 2027.
Following completion of the program, Union Pacific expects to operate more than 1,700 modernized locomotives. The new agreement builds on a prior order placed in 2022, which remains on track for completion in 2026.
“Our continued partnership with Union Pacific reflects a steady, forward-looking investment that positions the railroad and its customers for continued success,” said Rafael Santana, President and CEO of Wabtec.