10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

  SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2013

OR

[    ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

  SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 1-6075

UNION PACIFIC CORPORATION

(Exact name of registrant as specified in its charter)

UTAH	13-2626465
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1400 DOUGLAS STREET, OMAHA, NEBRASKA

(Address of principal executive offices)

68179

(Zip Code)

(402) 544-5000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

þ  Yes             ¨  No             

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

þ  Yes            ¨  No            

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer   þ        Accelerated filer   ¨        Non-accelerated filer   ¨        Smaller reporting company   ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

¨  Yes             þ  No            

As of July 12, 2013, there were 463,844,338 shares of the Registrant’s Common Stock outstanding.

TABLE OF CONTENTS

UNION PACIFIC CORPORATION

AND SUBSIDIARY COMPANIES

Item 1.	Condensed Consolidated Financial Statements:
	CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) For the Three Months Ended June 30, 2013 and 2012	3
	CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) For the Three Months Ended June  30, 2013 and 2012	3
	CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) For the Six Months Ended June 30, 2013 and 2012	4
	CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) For the Six Months Ended June  30, 2013 and 2012	4
	CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) At June 30, 2013 and December  31, 2012	5
	CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) For the Six Months Ended June 30, 2013 and 2012	6
	CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN COMMON SHAREHOLDERS’ EQUITY (Unaudited)      For the Six Months Ended June 30, 2013 and 2012	7
	NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	34
Item 4.	Controls and Procedures	34
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures	37
Item 5.	Other Information	37
Item 6.	Exhibits	38
Signatures		39
Certifications

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PART I. FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Condensed Consolidated Statements of Income (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, Except Per Share Amounts, for the Three Months Ended June 30,	2013		2012
Operating revenues:
Freight revenues	$	5,153	$	4,913
Other revenues		317		308
Total operating revenues		5,470		5,221
Operating expenses:
Compensation and benefits		1,185		1,151
Fuel		863		882
Purchased services and materials		585		542
Depreciation		438		433
Equipment and other rents		302		299
Other		219		190
Total operating expenses		3,592		3,497
Operating income		1,878		1,724
Other income (Note 6)		23		21
Interest expense		(133)		(135)
Income before income taxes		1,768		1,610
Income taxes		(662)		(608)
Net income	$	1,106	$	1,002
Share and Per Share (Note 8):
Earnings per share - basic	$	2.38	$	2.11
Earnings per share - diluted	$	2.37	$	2.10
Weighted average number of shares - basic		465.3		473.8
Weighted average number of shares - diluted		467.6		477.2
Dividends declared per share	$	0.69	$	0.60

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, for the Three Months Ended June 30,	2013		2012
Net income	$	1,106	$	1,002
Other comprehensive income/(loss):
Defined benefit plans		17		-
Foreign currency translation		4		(15)
Total other comprehensive income/(loss) [a]		21		(15)
Comprehensive income	$	1,127	$	987

[a] Net of deferred taxes of $13 million and $(9) million during the three months ended June 30, 2013, and 2012, respectively.

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

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Condensed Consolidated Statements of Income (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, Except Per Share Amounts, for the Six Months Ended June 30,	2013		2012
Operating revenues:
Freight revenues	$	10,137	$	9,736
Other revenues		623		597
Total operating revenues		10,760		10,333
Operating expenses:
Compensation and benefits		2,401		2,362
Fuel		1,763		1,808
Purchased services and materials		1,142		1,068
Depreciation		872		860
Equipment and other rents		615		595
Other		456		406
Total operating expenses		7,249		7,099
Operating income		3,511		3,234
Other income (Note 6)		63		37
Interest expense		(261)		(270)
Income before income taxes		3,313		3,001
Income taxes		(1,250)		(1,136)
Net income	$	2,063	$	1,865
Share and Per Share (Note 8):
Earnings per share - basic	$	4.42	$	3.92
Earnings per share - diluted	$	4.40	$	3.89
Weighted average number of shares - basic		466.6		475.8
Weighted average number of shares - diluted		469.1		479.3
Dividends declared per share	$	1.38	$	1.20

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, for the Six Months Ended June 30,	2013		2012
Net income	$	2,063	$	1,865
Other comprehensive income/(loss):
Defined benefit plans		31		(7)
Foreign currency translation		7		-
Other comprehensive income/(loss) [a]		38		(7)
Comprehensive income	$	2,101	$	1,858

[a] Net of deferred taxes of $25 million and $(1) million during the six months ended June 30, 2013, and 2012, respectively.

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

4

Condensed Consolidated Statements of Financial Position (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, Except Share and Per Share Amounts	June 30, 2013		December 31, 2012
Assets
Current assets:
Cash and cash equivalents	$	1,845	$	1,063
Accounts receivable, net (Note 10)		1,468		1,331
Materials and supplies		654		660
Current deferred income taxes (Note 7)		242		263
Other current assets		334		297
Total current assets		4,543		3,614
Investments		1,272		1,259
Net properties (Note 11)		42,911		41,997
Other assets		300		283
Total assets	$	49,026	$	47,153
Liabilities and Common Shareholders’ Equity
Current liabilities:
Accounts payable and other current liabilities (Note 12)	$	3,092	$	2,923
Debt due within one year (Note 14)		733		196
Total current liabilities		3,825		3,119
Debt due after one year (Note 14)		9,076		8,801
Deferred income taxes (Note 7)		13,477		13,108
Other long-term liabilities		2,124		2,248
Commitments and contingencies (Note 16)
Total liabilities		28,502		27,276
Common shareholders’ equity:
Common shares, $2.50 par value, 800,000,000 authorized;
554,840,853 and 554,558,034 issued; 464,363,763 and 469,465,273
outstanding, respectively		1,387		1,386
Paid-in-surplus		4,162		4,113
Retained earnings		23,690		22,271
Treasury stock		(7,567)		(6,707)
Accumulated other comprehensive loss (Note 9)		(1,148)		(1,186)
Total common shareholders’ equity		20,524		19,877
Total liabilities and common shareholders’ equity	$	49,026	$	47,153

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

5

Condensed Consolidated Statements of Cash Flows (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, for the Six Months Ended June 30,	2013		2012
Operating Activities
Net income	$	2,063	$	1,865
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation		872		860
Deferred income taxes and unrecognized tax benefits		365		274
Other operating activities, net		(83)		(25)
Changes in current assets and liabilities:
Accounts receivable, net		(137)		(96)
Materials and supplies		6		(32)
Other current assets		(37)		(99)
Accounts payable and other current liabilities		169		29
Cash provided by operating activities		3,218		2,776
Investing Activities
Capital investments		(1,730)		(1,816)
Proceeds from asset sales		42		30
Other investing activities, net		(51)		(96)
Cash used in investing activities		(1,739)		(1,882)
Financing Activities
Debt issued (Note 14)		944		695
Common share repurchases (Note 17)		(833)		(833)
Dividends paid		(646)		(575)
Debt repaid		(139)		(193)
Other financing activities, net		(23)		(4)
Cash used in financing activities		(697)		(910)
Net change in cash and cash equivalents		782		(16)
Cash and cash equivalents at beginning of year		1,063		1,217
Cash and cash equivalents at end of period	$	1,845	$	1,201
Supplemental Cash Flow Information
Non-cash investing and financing activities:
Cash dividends declared but not yet paid	$	316	$	280
Capital investments accrued but not yet paid		119		129
Common shares repurchased but not yet paid		24		15
Cash paid for:
Income taxes, net of refunds	$	(715)	$	(766)
Interest, net of amounts capitalized		(251)		(267)

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

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Condensed Consolidated Statements of Changes in Common Shareholders’ Equity (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions	Common Shares		Treasury Shares		Common Shares		Paid-in- Surplus		Retained Earnings		Treasury Stock		AOCI [a]		Total
Balance at January 1, 2012		554.3		(74.4)	$	1,386	$	4,031	$	19,508	$	(5,293)	$	(1,054)	$	18,578
Net income						-		-		1,865		-		-		1,865
Other comp. loss						-		-		-		-		(7)		(7)
Conversion, stock option exercises, forfeitures, and other		0.3		1.1		-		46		-		24		-		70
Share repurchases (Note 17)		-		(7.7)		-		-		-		(848)		-		(848)
Cash dividends declared ($1.20 per share)		-		-		-		-		(571)		-		-		(571)
Balance at June 30, 2012		554.6		(81.0)	$	1,386	$	4,077	$	20,802	$	(6,117)	$	(1,061)	$	19,087
Balance at January 1, 2013		554.6		(85.1)	$	1,386	$	4,113	$	22,271	$	(6,707)	$	(1,186)	$	19,877
Net income						-		-		2,063		-		-		2,063
Other comp. income						-		-		-		-		38		38
Conversion, stock option exercises, forfeitures, and other		0.2		0.6		1		49		-		(3)		-		47
Share repurchases (Note 17)		-		(5.9)		-		-		-		(857)		-		(857)
Cash dividends declared ($1.38 per share)		-		-		-		-		(644)		-		-		(644)
Balance at June 30, 2013		554.8		(90.4)	$	1,387	$	4,162	$	23,690	$	(7,567)	$	(1,148)	$	20,524

[a] AOCI = Accumulated Other Comprehensive Income/(Loss) (Note 9)

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

For purposes of this report, unless the context otherwise requires, all references herein to the “Corporation”, “UPC”, “we”, “us”, and “our” mean Union Pacific Corporation and its subsidiaries, including Union Pacific Railroad Company, which will be separately referred to herein as “UPRR” or the “Railroad”.

1. Basis of Presentation

Our Condensed Consolidated Financial Statements are unaudited and reflect all adjustments (consisting of normal and recurring adjustments) that are, in the opinion of management, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (GAAP). Our Consolidated Statement of Financial Position at December 31, 2012, is derived from audited financial statements. This Quarterly Report on Form 10-Q should be read in conjunction with our Consolidated Financial Statements and notes thereto contained in our 2012 Annual Report on Form 10-K. The results of operations for the six months ended June 30, 2013, are not necessarily indicative of the results for the entire year ending December 31, 2013.

The Condensed Consolidated Financial Statements are presented in accordance with GAAP as codified in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC).

2. Adoption of New Accounting Pronouncement

On February 5, 2013, the FASB issued Accounting Standards Update 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (ASU 2013-02), which adds additional disclosure requirements for items reclassified out of accumulated other comprehensive income. We adopted this ASU during the three months ended March 31, 2013.

3. Operations and Segmentation

The Railroad, along with its subsidiaries and rail affiliates, is our one reportable operating segment. Although we provide and analyze revenue by commodity group, we treat the financial results of the Railroad as one segment due to the integrated nature of our rail network. The following table provides freight revenue by commodity group:

	Three Months Ended June 30,				Six Months Ended June 30,
Millions	2013		2012		2013		2012
Agricultural	$	784	$	854	$	1,568	$	1,712
Automotive		534		475		1,021		905
Chemicals		890		795		1,763		1,563
Coal		975		869		1,911		1,864
Industrial Products		977		917		1,893		1,780
Intermodal		993		1,003		1,981		1,912
Total freight revenues		5,153		4,913		10,137		9,736
Other revenues		317		308		623		597
Total operating revenues	$	5,470	$	5,221	$	10,760	$	10,333

Although our revenues are principally derived from customers domiciled in the U.S., the ultimate points of origination or destination for some products transported by us are outside the U.S. Each of our commodity groups includes revenue from shipments to and from Mexico. Included in the above table are revenues from our Mexico business which amounted to $519 million and $503 million, respectively for the three months ended June 30, 2013, and June 30, 2012, and $1,024 million and $985 million, respectively for the six months ended June 30, 2013, and June 30, 2012.

8

4. Stock-Based Compensation

We have several stock-based compensation plans under which employees and non-employee directors receive stock options, nonvested retention shares, and nonvested stock units. We refer to the nonvested shares and stock units collectively as “retention awards”. We have elected to issue treasury shares to cover option exercises and stock unit vestings, while new shares are issued when retention shares are granted. Information regarding stock-based compensation appears in the table below:

	Three Months Ended June 30,				Six Months Ended June 30,
Millions	2013		2012		2013		2012
Stock-based compensation, before tax:
Stock options	$	6	$	4	$	10	$	9
Retention awards		20		20		41		40
Total stock-based compensation, before tax	$	26	$	24	$	51	$	49
Excess tax benefits from equity compensation plans	$	19	$	14	$	65	$	53

Stock Options – We estimate the fair value of our stock option awards using the Black-Scholes option pricing model. The table below shows the annual weighted-average assumptions used for valuation purposes:

Weighted-Average Assumptions		2013			2012
Risk-free interest rate		0.8	%		0.8	%
Dividend yield		2.1	%		2.1	%
Expected life (years)		5.0			5.3
Volatility		36.2	%		36.8	%
Weighted-average grant-date fair value of options granted	$	34.98		$	31.29

The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant; the dividend yield is calculated as the ratio of dividends paid per share of common stock to the stock price on the date of grant; the expected life is based on historical and expected exercise behavior; and volatility is based on the historical volatility of our stock price over the expected life of the option.

A summary of stock option activity during the six months ended June 30, 2013, is presented below:

	Options (thous.)		Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term		Aggregate Intrinsic Value (millions)
Outstanding at January 1, 2013		4,289		$    65.68		5.8 yrs.		$    258
Granted		572		132.00		N/A		N/A
Exercised		(853)		51.48		N/A		N/A
Forfeited or expired		(22)		106.00		N/A		N/A
Outstanding at June 30, 2013		3,986		$    78.01		6.1 yrs.		$    304
Vested or expected to vest at June 30, 2013		3,986		$    77.99		6.1 yrs.		$    304
Options exercisable at June 30, 2013		2,839		$    61.11		5.0 yrs.		$    265

Stock options are granted at the closing price on the date of grant, have ten-year contractual terms, and vest no later than three years from the date of grant. None of the stock options outstanding at June 30, 2013, are subject to performance or market-based vesting conditions.

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At June 30, 2013, there was $26 million of unrecognized compensation expense related to nonvested stock options, which is expected to be recognized over a weighted-average period of 1.6 years. Additional information regarding stock option exercises appears in the table below:

	Three Months Ended June 30,				Six Months Ended June 30,
Millions	2013		2012		2013		2012
Intrinsic value of stock options exercised		$      54		$      41		$      82		$      103
Cash received from option exercises		17		24		31		45
Treasury shares repurchased for employee payroll taxes		(7)		(8)		(12)		(16)
Tax benefit realized from option exercises		21		15		32		39
Aggregate grant-date fair value of stock options vested		-		-		16		16

Retention Awards – The fair value of retention awards is based on the closing price of the stock on the grant date. Dividends and dividend equivalents are paid to participants during the vesting periods.

Changes in our retention awards during the six months ended June 30, 2013, were as follows:

	Shares (thous.)		Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2013		2,355		$    73.27
Granted		421		132.02
Vested		(850)		47.50
Forfeited		(48)		81.74
Nonvested at June 30, 2013		1,878		$    97.89

Retention awards are granted at no cost to the employee or non-employee director and vest over periods lasting up to four years. At June 30, 2013, there was $95 million of total unrecognized compensation expense related to nonvested retention awards, which is expected to be recognized over a weighted-average period of 2.0 years.

Performance Retention Awards – In February 2013, our Board of Directors approved performance stock unit grants. Other than different performance targets, the basic terms of these performance stock units are identical to those granted in February 2011, and February 2012, including using annual return on invested capital (ROIC) as the performance measure. We define ROIC as net operating profit adjusted for interest expense (including interest on the present value of operating leases) and taxes on interest divided by average invested capital adjusted for the present value of operating leases.

Stock units awarded to selected employees under these grants are subject to continued employment for 37 months and the attainment of certain levels of ROIC. We expense the fair value of the units that are probable of being earned based on our forecasted ROIC over the 3-year performance period. We measure the fair value of these performance stock units based upon the closing price of the underlying common stock as of the date of grant, reduced by the present value of estimated future dividends. Dividend equivalents are paid to participants only after the units are earned.

The assumptions used to calculate the present value of estimated future dividends related to the February 2013, grant were as follows:

	2013
Dividend per share per quarter		$    0.69
Risk-free interest rate at date of grant		0.4%

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Changes in our performance retention awards during the six months ended June 30, 2013, were as follows:

	Shares (thous.)		Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2013		1,075		$    83.80
Granted		304		125.14
Vested		(401)		58.33
Forfeited		(32)		96.85
Nonvested at June 30, 2013		946		$  107.44

At June 30, 2013, there was $55 million of total unrecognized compensation expense related to nonvested performance retention awards, which is expected to be recognized over a weighted-average period of 1.6 years. This expense is subject to achievement of the ROIC levels established for the performance stock unit grants.

5. Retirement Plans

Pension and Other Postretirement Benefits

Pension Plans – We provide defined benefit retirement income to eligible non-union employees through qualified and non-qualified (supplemental) pension plans. Qualified and non-qualified pension benefits are based on years of service and the highest compensation during the latest years of employment, with specific reductions made for early retirements.

Other Postretirement Benefits (OPEB) – We provide medical and life insurance benefits for eligible retirees. These benefits are funded as medical claims and life insurance premiums are paid.

Expense

Both pension and OPEB expense are determined based upon the annual service cost of benefits (the actuarial cost of benefits earned during a period) and the interest cost on those liabilities, less the expected return on plan assets. The expected long-term rate of return on plan assets is applied to a calculated value of plan assets that recognizes changes in fair value over a five-year period. This practice is intended to reduce year-to-year volatility in pension expense, but it can have the effect of delaying the recognition of differences between actual returns on assets and expected returns based on long-term rate of return assumptions. Differences in actual experience in relation to assumptions are not recognized in net income immediately, but are deferred in accumulated other comprehensive income and, if necessary, amortized as pension or OPEB expense.

The components of our net periodic pension cost were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
Millions	2013		2012		2013		2012
Service cost		$        18		$        14		$        37		$        27
Interest cost		33		35		66		70
Expected return on plan assets		(50)		(48)		(101)		(95)
Amortization of:
Prior service cost		-		-		-		-
Actuarial loss		27		21		53		42
Net periodic pension cost		$        28		$        22		$        55		$        44

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The components of our net periodic OPEB cost were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
Millions	2013		2012		2013		2012
Service cost	$	1	$	1	$	2	$	2
Interest cost		3		4		6		7
Amortization of:
Prior service credit		(4)		(4)		(8)		(8)
Actuarial loss		3		2		7		5
Net periodic OPEB cost	$	3	$	3	$	7	$	6

Cash Contributions

For the six months ended June 30, 2013, we made $70 million of cash contributions to the qualified pension plan. Any additional contributions made in the second half of the year will be based on cash generated from operations and financial market considerations. All contributions made to the qualified pension plan during the six months ended June 30, 2013, were voluntary and were made with cash generated from operations. Our policy with respect to funding the qualified plans is to fund at least the minimum required by law and not more than the maximum amount deductible for tax purposes. At June 30, 2013, we do not have minimum cash funding requirements for 2013.

6. Other Income

Other income included the following:

	Three Months Ended June 30,				Six Months Ended June 30,
Millions	2013		2012		2013 [a]		2012
Rental income	$	21	$	21	$	58	$	41
Net gain on non-operating asset dispositions		-		11		4		12
Early extinguishment of debt		(1)		(2)		(1)		(2)
Non-operating environmental costs and other		3		(9)		2		(14)
Total	$	23	$	21	$	63	$	37

[a] Rental income includes $17 million related to a land lease contract settlement.

7. Income Taxes

Internal Revenue Service (IRS) examinations have been completed and settled for all years prior to 2005, although some interest calculations remain open for years prior to 2005. The IRS has completed its examinations and issued notices of deficiency for years 2005 through 2008. We disagree with many of their proposed adjustments, and we are at IRS Appeals for these years. The IRS is examining years 2009 and 2010, and we expect to receive their exam report in 2013. Additionally, several state tax authorities are examining our state income tax returns for years 2006 through 2010.

At June 30, 2013, our liability for unrecognized tax benefits was $114 million. Of that amount, $9 million is classified as a current asset in the Condensed Consolidated Statements of Financial Position.

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8. Earnings Per Share

The following table provides a reconciliation between basic and diluted earnings per share:

	Three Months Ended June 30,				Six Months Ended June 30,
Millions, Except Per Share Amounts	2013		2012		2013		2012
Net income	$	1,106	$	1,002	$	2,063	$	1,865
Weighted-average number of shares outstanding:
Basic		465.3		473.8		466.6		475.8
Dilutive effect of stock options		1.3		1.4		1.4		1.4
Dilutive effect of retention shares and units		1.0		2.0		1.1		2.1
Diluted		467.6		477.2		469.1		479.3
Earnings per share – basic	$	2.38	$	2.11	$	4.42	$	3.92
Earnings per share – diluted	$	2.37	$	2.10	$	4.40	$	3.89
Stock options excluded as their inclusion would be antidilutive		0.6		0.6		0.5		0.5

9. Accumulated Other Comprehensive Income/(Loss)

Reclassifications out of accumulated other comprehensive income/(loss) for the three and six months ended June 30, 2013, and 2012, were as follows (net of tax):

Millions	Defined benefit plans		Foreign currency translation		Derivatives		Total
Balance at April 1, 2013	$	(1,135)	$	(33)	$	(1)	$	(1,169)
Other comprehensive income/(loss) before reclassifications		1		4		-		5
Amounts reclassified from accumulated other comprehensive income/(loss) [a]		16		-		-		16
Net quarter-to-date other comprehensive income/(loss), net of taxes of $13 million		17		4		-		21
Balance at June 30, 2013	$	(1,118)	$	(29)	$	(1)	$	(1,148)
Balance at April 1, 2012	$	(1,011)	$	(33)	$	(2)	$	(1,046)
Other comprehensive income/(loss) before reclassifications		-		(15)		-		(15)
Amounts reclassified from accumulated other comprehensive income/(loss)		-		-		-		-
Net quarter-to-date other comprehensive income/(loss), net of taxes of ($9) million		-		(15)		-		(15)
Balance at June 30, 2012	$	(1,011)	$	(48)	$	(2)	$	(1,061)

[a] The accumulated other comprehensive income/(loss) reclassification components are 1) prior service cost/(benefit) and 2) net actuarial loss which are both included in the computation of net periodic pension cost. See Note 5 Retirement Plans for additional details.

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Millions	Defined benefit plans		Foreign currency translation		Derivatives		Total
Balance at January 1, 2013	$	(1,149)	$	(36)	$	(1)	$	(1,186)
Other comprehensive income/(loss) before reclassifications		(2)		7		-		5
Amounts reclassified from accumulated other comprehensive income/(loss) [a]		33		-		-		33
Net year-to-date other comprehensive income/(loss), net of taxes of $25 million		31		7		-		38
Balance at June 30, 2013	$	(1,118)	$	(29)	$	(1)	$	(1,148)
Balance at January 1, 2012	$	(1,004)	$	(48)	$	(2)	$	(1,054)
Other comprehensive income/(loss) before reclassifications		(7)		-		-		(7)
Amounts reclassified from accumulated other comprehensive income/(loss)		-		-		-		-
Net year-to-date other comprehensive income/(loss), net of taxes of ($1) million		(7)		-		-		(7)
Balance at June 30, 2012	$	(1,011)	$	(48)	$	(2)	$	(1,061)

[a] The accumulated other comprehensive income/(loss) reclassification components are 1) prior service cost/(benefit) and 2) net actuarial loss which are both included in the computation of net periodic pension cost. See Note 5 Retirement Plans for additional details.

10. Accounts Receivable

Accounts receivable includes freight and other receivables reduced by an allowance for doubtful accounts. The allowance is based upon historical losses, credit worthiness of customers, and current economic conditions. At both June 30, 2013, and December 31, 2012, our accounts receivable were reduced by $4 million. Receivables not expected to be collected in one year and the associated allowances are classified as other assets in our Condensed Consolidated Statements of Financial Position. At June 30, 2013, and December 31, 2012, receivables classified as other assets were reduced by allowances of $27 million and $33 million, respectively.

Receivables Securitization Facility – The Railroad maintains a $600 million, 364-day receivables securitization facility under which it sells most of its eligible third-party receivables to Union Pacific Receivables, Inc. (UPRI), a wholly-owned, bankruptcy-remote subsidiary that may subsequently transfer, without recourse an undivided interest in accounts receivable to investors. The investors have no recourse to the Railroad’s other assets except for customary warranty and indemnity claims. Creditors of the Railroad do not have recourse to the assets of UPRI.

The amount outstanding under the facility was $400 million and $100 million at June 30, 2013, and December 31, 2012, respectively. The amount outstanding under the facility was supported by $1.2 billion and $1.1 billion of accounts receivable as collateral at June 30, 2013, and December 31, 2012, respectively, which, as a retained interest, is included in accounts receivable, net in our Condensed Consolidated Statements of Financial Position.

The outstanding amounts the Railroad is allowed to maintain under the facility, with a maximum of $600 million, may fluctuate based on the availability of eligible receivables and is directly affected by business volumes and credit risks, including receivables payment quality measures such as default and dilution ratios. If default or dilution ratios increase one percent, amounts allowed to be outstanding under the facility would not materially change.

The costs of the receivables securitization facility include interest, which will vary based on prevailing commercial paper rates, program fees paid to banks, commercial paper issuing costs, and fees for unused commitment availability. The costs of the receivables securitization facility are included in interest

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expense and were $1 million for the three months ended June 30, 2013, and 2012, and $2 million for the six months ended June 30, 2013, and 2012.

We are currently in the process of renewing the receivables securitization facility for an additional 364-day period at comparable terms and conditions.

11. Properties

The following tables list the major categories of property and equipment, as well as the weighted average estimated useful life for each category (in years):

Millions, Except Estimated Useful Life As of June 30, 2013	Cost		Accumulated Depreciation		Net Book Value		Estimated Useful Life
Land	$	5,100	$	N/A	$	5,100		N/A
Road:
Rail and other track material		13,519		4,869		8,650		35
Ties		8,608		2,227		6,381		33
Ballast		4,491		1,127		3,364		34
Other roadway [a]		14,989		2,651		12,338		48
Total road		41,607		10,874		30,733		N/A
Equipment:
Locomotives		7,408		3,315		4,093		20
Freight cars		2,042		1,009		1,033		25
Work equipment and other		546		105		441		19
Total equipment		9,996		4,429		5,567		N/A
Technology and other		658		269		389		11
Construction in progress		1,122		-		1,122		N/A
Total	$	58,483	$	15,572	$	42,911		N/A

Millions, Except Estimated Useful Life   As of December 31, 2012	Cost		Accumulated Depreciation		Net Book Value		Estimated Useful Life
Land	$	5,105	$	N/A	$	5,105		N/A
Road:
Rail and other track material		13,220		4,756		8,464		33
Ties		8,404		2,157		6,247		33
Ballast		4,399		1,085		3,314		34
Other roadway [a]		14,806		2,583		12,223		49
Total road		40,829		10,581		30,248		N/A
Equipment:
Locomotives		7,297		3,321		3,976		19
Freight cars		1,991		1,018		973		23
Work equipment and other		535		89		446		17
Total equipment		9,823		4,428		5,395		N/A
Technology and other		633		273		360		11
Construction in progress		889		-		889		N/A
Total	$	57,279	$	15,282	$	41,997		N/A

[a] Other roadway includes grading, bridges and tunnels, signals, buildings, and other road assets.

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12. Accounts Payable and Other Current Liabilities

Millions	June 30, 2013		Dec. 31, 2012
Accounts payable	$	908	$	825
Income and other taxes payable		413		368
Accrued wages and vacation		375		376
Dividends payable		316		318
Accrued casualty costs		224		213
Interest payable		183		172
Equipment rents payable		99		95
Other		574		556
Total accounts payable and other current liabilities	$	3,092	$	2,923

13. Financial Instruments

Strategy and Risk – We may use derivative financial instruments in limited instances for other than trading purposes to assist in managing our overall exposure to fluctuations in interest rates and fuel prices. We are not a party to leveraged derivatives and, by policy, do not use derivative financial instruments for speculative purposes. Derivative financial instruments qualifying for hedge accounting must maintain a specified level of effectiveness between the hedging instrument and the item being hedged, both at inception and throughout the hedged period. We formally document the nature and relationships between the hedging instruments and hedged items at inception, as well as our risk-management objectives, strategies for undertaking the various hedge transactions, and method of assessing hedge effectiveness. Changes in the fair market value of derivative financial instruments that do not qualify for hedge accounting are charged to earnings. We may use swaps, collars, futures, and/or forward contracts to mitigate the risk of adverse movements in interest rates and fuel prices; however, the use of these derivative financial instruments may limit future benefits from favorable interest rate and fuel price movements.

Interest Rate Cash Flow Hedges – We report changes in the fair value of cash flow hedges in accumulated other comprehensive loss until the hedged item affects earnings. At both June 30, 2013, and December 31, 2012, we had reductions of $1 million recorded as an accumulated other comprehensive loss that is being amortized on a straight-line basis through September 30, 2014, for a cash flow hedge that was settled in 2004. As of June 30, 2013, and December 31, 2012, we had no interest rate cash flow hedges outstanding.

Fair Value of Financial Instruments – The fair value of our short- and long-term debt was estimated using a market value price model, which utilizes applicable U.S. Treasury rates along with current market quotes on comparable debt securities. All of the inputs used to determine the fair market value of the Corporation’s long-term debt are Level 2 inputs and obtained from an independent source. At June 30, 2013, the fair value of total debt was $11 billion, approximately $1.2 billion more than the carrying value. At December 31, 2012, the fair value of total debt was $11.1 billion, approximately $2.1 billion more than the carrying value. The fair value of the Corporation’s debt is a measure of its current value under present market conditions. It does not impact the financial statements under current accounting rules. At June 30, 2013, and December 31, 2012, approximately $163 and $203 million, respectively, of debt securities contained call provisions that allow us to retire the debt instruments prior to final maturity, with the payment of fixed call premiums, or in certain cases, at par. The fair value of our cash equivalents approximates their carrying value due to the short-term maturities of these instruments.

14. Debt

Credit Facilities – At June 30, 2013, we had $1.8 billion of credit available under our revolving credit facility (the facility), which is designated for general corporate purposes and supports the issuance of commercial paper. We did not draw on the facility at any time during the six months ended June 30, 2013. Commitment fees and interest rates payable under the facility are similar to fees and rates available to comparably rated, investment-grade borrowers. The facility allows for borrowings at floating rates based on London Interbank Offered Rates, plus a spread, depending upon our senior unsecured debt ratings.

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The facility matures in 2015 under a four year term and requires the Corporation to maintain a debt-to-net-worth coverage ratio as a condition to making a borrowing. At June 30, 2013, and December 31, 2012 (and at all times during the first and second quarters), we were in compliance with this covenant.

The definition of debt used for purposes of calculating the debt-to-net-worth coverage ratio includes, among other things, certain credit arrangements, capital leases, guarantees and unfunded and vested pension benefits under Title IV of ERISA. At June 30, 2013, the debt-to-net-worth coverage ratio allowed us to carry up to $41 billion of debt (as defined in the facility), and we had $10.4 billion of debt (as defined in the facility) outstanding at that date. Under our current capital plans, we expect to continue to satisfy the debt-to-net-worth coverage ratio; however, many factors beyond our reasonable control could affect our ability to comply with this provision in the future. The facility does not include any other financial restrictions, credit rating triggers (other than rating-dependent pricing), or any other provision that could require us to post collateral. The facility also includes a $75 million cross-default provision and a change-of-control provision.

During the three and six months ended June 30, 2013, we did not issue or repay any commercial paper, and at June 30, 2013, we had no commercial paper outstanding. Our revolving credit facility supports our outstanding commercial paper balances, and, unless we change the terms of our commercial paper program, our aggregate issuance of commercial paper will not exceed the amount of borrowings available under the facility.

Shelf Registration Statement and Significant New Borrowings – We filed a new automatic shelf registration statement that became effective on February 8, 2013. The Board of Directors authorized the issuance of up to $4 billion of debt securities, replacing the $1.4 billion of authority remaining under our shelf registration filed in February 2010. SEC rules require UPC, a large accelerated filer, to file a new shelf registration statement every three years. Under the current shelf registration, we may issue, from time to time, any combination of debt securities, preferred stock, common stock, or warrants for debt securities or preferred stock in one or more offerings. We have no immediate plans to issue equity securities; however, we will continue to explore opportunities to replace existing debt or access capital through issuances of debt securities under our shelf registration, and, therefore, we may issue additional debt securities at any time.

On March 15, 2013, we issued $325 million of 2.75% unsecured fixed-rate notes and $325 million of 4.25% unsecured fixed-rate notes under our shelf registration statement. The 2.75% notes will mature on April 15, 2023, and the 4.25% notes will mature on April 15, 2043. Proceeds from this offering are for general corporate purposes, including the repurchase of common stock pursuant to our share repurchase program. These debt securities include change-of-control provisions. At June 30, 2013, we had remaining authority from our Board of Directors to issue up to $3.35 billion of debt securities under the shelf registration.

At June 30, 2013, and December 31, 2012, we reclassified as long-term debt approximately $400 million and $100 million, respectively, of debt due within one year that we intend to refinance. This reclassification reflects our ability and intent to refinance any short-term borrowings and certain current maturities of long-term debt on a long-term basis.

Debt Redemption – On May 14, 2013, we redeemed all $40 million of our outstanding 5.65% Port of Corpus Christi Authority Revenue Refunding Bonds due December 1, 2022. The redemption resulted in an early extinguishment charge of $1 million during the three months ended June 30, 2013.

Receivables Securitization Facility – As of June 30, 2013, and December 31, 2012, we recorded $400 million and $100 million, respectively, as secured debt under our receivables securitization facility. See further discussion of our receivables securitization facility in Note 10.

15. Variable Interest Entities

We have entered into various lease transactions in which the structure of the leases contain variable interest entities (VIEs). These VIEs were created solely for the purpose of doing lease transactions (principally involving railroad equipment and facilities, including our headquarters building) and have no other activities, assets or liabilities outside of the lease transactions. Within these lease arrangements, we have the right to purchase some or all of the assets at fixed prices. Depending on market conditions,

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fixed-price purchase options available in the leases could potentially provide benefits to us; however, these benefits are not expected to be significant.

We maintain and operate the assets based on contractual obligations within the lease arrangements, which set specific guidelines consistent within the railroad industry. As such, we have no control over activities that could materially impact the fair value of the leased assets. We do not hold the power to direct the activities of the VIEs and, therefore, do not control the ongoing activities that have a significant impact on the economic performance of the VIEs. Additionally, we do not have the obligation to absorb losses of the VIEs or the right to receive benefits of the VIEs that could potentially be significant to the VIEs.

We are not considered to be the primary beneficiary and do not consolidate these VIEs because our actions and decisions do not have the most significant effect on the VIE’s performance and our fixed-price purchase price options are not considered to be potentially significant to the VIEs. The future minimum lease payments associated with the VIE leases totaled $3.4 billion as of June 30, 2013.

16. Commitments and Contingencies

Asserted and Unasserted Claims – Various claims and lawsuits are pending against us and certain of our subsidiaries. We cannot fully determine the effect of all asserted and unasserted claims on our consolidated results of operations, financial condition, or liquidity; however, to the extent possible, where asserted and unasserted claims are considered probable and where such claims can be reasonably estimated, we have recorded a liability. We do not expect that any known lawsuits, claims, environmental costs, commitments, contingent liabilities, or guarantees will have a material adverse effect on our consolidated results of operations, financial condition, or liquidity after taking into account liabilities and insurance recoveries previously recorded for these matters.

Personal Injury – The cost of personal injuries to employees and others related to our activities is charged to expense based on estimates of the ultimate cost and number of incidents each year. We use an actuarial analysis to measure the expense and liability, including unasserted claims. The Federal Employers’ Liability Act (FELA) governs compensation for work-related accidents. Under FELA, damages are assessed based on a finding of fault through litigation or out-of-court settlements. We offer a comprehensive variety of services and rehabilitation programs for employees who are injured at work.

Our personal injury liability is not discounted to present value due to the uncertainty surrounding the timing of future payments. Approximately 90% of the recorded liability is related to asserted claims and approximately 10% is related to unasserted claims at June 30, 2013. Because of the uncertainty surrounding the ultimate outcome of personal injury claims, it is reasonably possible that future costs to settle these claims may range from approximately $315 to $343 million. We record an accrual at the low end of the range as no amount of loss within the range is more probable than any other. Estimates can vary over time due to evolving trends in litigation.

Our personal injury liability activity was as follows:

Millions,   for the Six Months Ended June 30,	2013		2012
Beginning balance	$	334	$	368
Current year accruals		47		58
Changes in estimates for prior years		(22)		(36)
Payments		(44)		(50)
Ending balance at June 30	$	315	$	340
Current portion, ending balance at June 30	$	90	$	102

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Asbestos – We are a defendant in a number of lawsuits in which current and former employees and other parties allege exposure to asbestos. We assess our potential liability using a statistical analysis of resolution costs for asbestos-related claims. This liability is updated annually and excludes future defense and processing costs. The liability for resolving both asserted and unasserted claims was based on the following assumptions:

• The ratio of future claims by alleged disease would be consistent with historical averages adjusted for inflation.

• The number of claims filed against us will decline each year.

• The average settlement values for asserted and unasserted claims will be equivalent to historical averages.

• The percentage of claims dismissed in the future will be equivalent to historical averages.

Our liability for asbestos-related claims is not discounted to present value due to the uncertainty surrounding the timing of future payments. Approximately 23% of the recorded liability related to asserted claims and approximately 77% related to unasserted claims at June 30, 2013.

Our asbestos-related liability activity was as follows:

Millions,   for the Six Months Ended June 30,	2013		2012
Beginning balance	$	139	$	147
Accruals		-		-
Payments		(5)		(4)
Ending balance at June 30	$	134	$	143
Current portion, ending balance at June 30	$	8	$	9

We have insurance coverage for a portion of the costs incurred to resolve asbestos-related claims, and we have recognized an asset for estimated insurance recoveries at June 30, 2013, and December 31, 2012.

We believe that our estimates of liability for asbestos-related claims and insurance recoveries are reasonable and probable. The amounts recorded for asbestos-related liabilities and related insurance recoveries were based on currently known facts. However, future events, such as the number of new claims filed each year, average settlement costs, and insurance coverage issues, could cause the actual costs and insurance recoveries to be higher or lower than the projected amounts. Estimates also may vary in the future if strategies, activities, and outcomes of asbestos litigation materially change; federal and state laws governing asbestos litigation increase or decrease the probability or amount of compensation of claimants; and there are material changes with respect to payments made to claimants by other defendants.

Environmental Costs – We are subject to federal, state, and local environmental laws and regulations. We have identified 279 sites at which we are or may be liable for remediation costs associated with alleged contamination or for violations of environmental requirements. This includes 33 sites that are the subject of actions taken by the U.S. government, 17 of which are currently on the Superfund National Priorities List. Certain federal legislation imposes joint and several liability for the remediation of identified sites; consequently, our ultimate environmental liability may include costs relating to activities of other parties, in addition to costs relating to our own activities at each site.

When we identify an environmental issue with respect to property owned, leased, or otherwise used in our business, we perform, with assistance of our consultants, environmental assessments on the property. We expense the cost of the assessments as incurred. We accrue the cost of remediation where our obligation is probable and such costs can be reasonably estimated. We do not discount our environmental liabilities when the timing of the anticipated cash payments is not fixed or readily determinable. At both June 30, 2013, and December 31, 2012, none of our environmental liability was discounted.

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Our environmental liability activity was as follows:

Millions,   for the Six Months Ended June 30,	2013		2012
Beginning balance	$	170	$	172
Accruals		19		24
Payments		(21)		(16)
Ending balance at June 30	$	168	$	180
Current portion, ending balance at June 30	$	49	$	47

The environmental liability includes future costs for remediation and restoration of sites, as well as ongoing monitoring costs, but excludes any anticipated recoveries from third parties. Cost estimates are based on information available for each site, financial viability of other potentially responsible parties, and existing technology, laws, and regulations. The ultimate liability for remediation is difficult to determine because of the number of potentially responsible parties, site-specific cost sharing arrangements with other potentially responsible parties, the degree of contamination by various wastes, the scarcity and quality of volumetric data related to many of the sites, and the speculative nature of remediation costs. Estimates of liability may vary over time due to changes in federal, state, and local laws governing environmental remediation. Current obligations are not expected to have a material adverse effect on our consolidated results of operations, financial condition, or liquidity.

Insurance – The Company has a consolidated, wholly-owned captive insurance subsidiary (the captive), that provides insurance coverage for certain risks including FELA claims and property coverage which are subject to reinsurance. The captive entered into annual reinsurance treaty agreements that insure workers compensation, general liability, auto liability and FELA risk. The captive cedes a portion of its FELA exposure through the treaty and assumes a proportionate share of the entire risk. The captive receives direct premiums, which are netted against the Company’s premium costs in other expenses in the Condensed Consolidated Statements of Income. The treaty agreements provide for certain protections against the risk of treaty participants’ non-performance, and we do not believe our exposure to treaty participants’ non-performance is material at this time. In the event the Company leaves the reinsurance program, the Company is not relieved of its primary obligation to the policyholders for activity prior to the termination of the treaty agreements. We record both liabilities and reinsurance receivables using an actuarial analysis based on historical experience in our Condensed Consolidated Statements of Financial Position.

Guarantees – At both June 30, 2013, and December 31, 2012, we were contingently liable for $307 million in guarantees. We have recorded a liability of $1 million and $2 million for the fair value of these obligations as of June 30, 2013, and December 31, 2012, respectively. We entered into these contingent guarantees in the normal course of business, and they include guaranteed obligations related to our headquarters building, equipment financings, and affiliated operations. The final guarantee expires in 2022. We are not aware of any existing event of default that would require us to satisfy these guarantees. We do not expect that these guarantees will have a material adverse effect on our consolidated financial condition, results of operations, or liquidity.

Indemnities – Our maximum potential exposure under indemnification arrangements, including certain tax indemnifications, can range from a specified dollar amount to an unlimited amount, depending on the nature of the transactions and the agreements. Due to uncertainty as to whether claims will be made or how they will be resolved, we cannot reasonably determine the probability of an adverse claim or reasonably estimate any adverse liability or the total maximum exposure under these indemnification arrangements. We do not have any reason to believe that we will be required to make any material payments under these indemnity provisions.

Operating Leases – At June 30, 2013, we had commitments for future minimum lease payments under operating leases with initial or remaining non-cancelable lease terms in excess of one year of approximately $4 billion.

Gain Contingency – UPRR and Santa Fe Pacific Pipelines (SFPP, a subsidiary of Kinder Morgan Energy Partners, L.P.) currently are engaged in a proceeding to resolve the fair market rent payable to

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UPRR under a 10-year agreement commencing on January 1, 2004, for pipeline easements on UPRR rights-of-way (Union Pacific Railroad Company vs. Santa Fe Pacific Pipelines, Inc., SFPP, L.P., Kinder Morgan Operating L.P. “D” Kinder Morgan G.P., Inc., et al., Superior Court of the State of California for the County of Los Angeles, filed July 28, 2004). In February 2007, a trial began to resolve this issue, and, on September 28, 2011, the judge issued a tentative Statement of Decision, which concluded that SFPP owes back rent to UPRR for the years 2004 through 2011. On May 29, 2012, the court entered judgment, awarding UPRR back rent and prejudgment interest. SFPP is appealing the final judgment. A favorable final judgment may materially affect our results of operations in the period of any monetary recoveries; however, due to the uncertainty regarding the amount and timing of any recovery, including the outcome of SFPP’s appeal of this judgment or any subsequent proceeding, we consider this a gain contingency and do not reflect any amounts in the Condensed Consolidated Financial Statements as of June 30, 2013.

17. Share Repurchase Program

Effective April 1, 2011, our Board of Directors authorized the repurchase of up to 40 million shares of our common stock by March 31, 2014, replacing our previous repurchase program. As of June 30, 2013, we repurchased a total of $8.0 billion of our common stock since the commencement of our repurchase programs. The table below represents shares repurchased under the new repurchase program.

	Number of Shares Purchased				Average Price Paid
	2013		2012		2013		2012
First quarter		2,881,400		3,917,369	$	136.58	$	110.64
Second quarter		3,061,470		3,770,528		151.42		110.02
Total		5,942,870		7,687,897		144.23		110.33
Remaining number of shares that may be repurchased under current authority								9,093,079

Management’s assessments of market conditions and other pertinent facts guide the timing and volume of all repurchases. We expect to fund any share repurchases under this program through cash generated from operations, the sale or lease of various operating and non-operating properties, debt issuances, and cash on hand. Repurchased shares are recorded in treasury stock at cost, which includes any applicable commissions and fees.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

RESULTS OF OPERATIONS

Three and Six Months Ended June 30, 2013, Compared to

Three and Six Months Ended June 30, 2012

For purposes of this report, unless the context otherwise requires, all references herein to “UPC”, “Corporation”, “we”, “us”, and “our” shall mean Union Pacific Corporation and its subsidiaries, including Union Pacific Railroad Company, which we separately refer to as “UPRR” or the “Railroad”.

The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements and applicable notes to the Condensed Consolidated Financial Statements, Item 1, and other information included in this report. Our Condensed Consolidated Financial Statements are unaudited and reflect all adjustments (consisting only of normal and recurring adjustments) that are, in the opinion of management, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (GAAP).

The Railroad, along with its subsidiaries and rail affiliates, is our one reportable business segment. Although we provide and analyze revenue by commodity group, we treat the financial results of the Railroad as one segment due to the integrated nature of our rail network.

Available Information

Our Internet website is www.up.com. We make available free of charge on our website (under the “Investors” caption link) our Annual Reports on Form 10-K; our Quarterly Reports on Form 10-Q; eXtensible Business Reporting Language (XBRL) documents; our current reports on Form 8-K; our proxy statements; Forms 3, 4, and 5, filed on behalf of directors and executive officers; and amendments to any such reports filed or furnished pursuant to the Securities Exchange Act of 1934, as amended (the Exchange Act), as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission (SEC). We also make available on our website previously filed SEC reports and exhibits via a link to EDGAR on the SEC’s Internet site at www.sec.gov. We provide these previously filed reports as a convenience and their contents reflect only information that was true and correct as of the date of the report. We assume no obligation to update this historical information. Additionally, our corporate governance materials, including By-Laws, Board Committee charters, governance guidelines and policies, and codes of conduct and ethics for directors, officers, and employees are available on our website. From time to time, the corporate governance materials on our website may be updated as necessary to comply with rules issued by the SEC and the New York Stock Exchange or as desirable to promote the effective and efficient governance of our company. Any security holder wishing to receive, without charge, a copy of any of our SEC filings or corporate governance materials should send a written request to: Secretary, Union Pacific Corporation, 1400 Douglas Street, Omaha, NE 68179.

References to our website address in this report, including references in Management’s Discussion and Analysis of Financial Condition and Results of Operations, Item 2, are provided as a convenience and do not constitute, and should not be deemed, an incorporation by reference of the information contained on, or available through, the website. Therefore, such information should not be considered part of this report.

Critical Accounting Policies and Estimates

We base our discussion and analysis of our financial condition and results of operations upon our Condensed Consolidated Financial Statements. The preparation of these financial statements requires estimation and judgment that affect the reported amounts of revenues, expenses, assets, and liabilities. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. If these estimates differ materially from actual results, the impact on the Condensed Consolidated Financial Statements may be material. Our critical accounting policies are available in Item 7 of our 2012 Annual

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Report on Form 10-K. There have not been any significant changes with respect to these policies during the first six months of 2013.

RESULTS OF OPERATIONS

Quarterly Summary

We reported earnings of $2.37 per diluted share on net income of $1.1 billion in the second quarter of 2013 compared to earnings of $2.10 per diluted share on net income of $1 billion for the second quarter of 2012. Year-to-date, net income was $2.1 billion versus $1.9 billion for the same period in 2012. Freight revenues increased 5%, or $240 million, in the second quarter compared to the same period in 2012 driven by higher average revenue per car (ARC) due to core pricing gains and growth in higher ARC shipments. Continued volume growth in shale-related products (crude oil, frac sand and pipe), automotives and domestic intermodal nearly offset the declines from agricultural products and international intermodal. Consistent with the first quarter, core pricing gains, our ongoing focus on safety, service and network efficiency, and continuing cost control measures drove record financial results in the second quarter.

Average train speed, as reported to the Association of American Railroads (AAR), declined 3% compared to 2012 due to weather and incident interruptions and increased work on capital projects in higher volume corridors. Average terminal dwell time increased 4% compared to the second quarter of 2012, primarily due to continuing growth of manifest traffic concentrated in the Southern Region. Even with the growth in manifest shipments, which have longer cycle times, average rail car inventory decreased 3% in the second quarter as volumes declined 1%. Despite these challenges, we continue to effectively manage our network.

Operating Revenues

	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
Millions	2013		2012				2013		2012
Freight revenues	$	5,153	$	4,913		5%	$	10,137	$	9,736		4%
Other revenues		317		308		3		623		597		4
Total	$	5,470	$	5,221		5%	$	10,760	$	10,333		4%

We generate freight revenues by transporting freight or other materials from our six commodity groups. Freight revenues vary with volume (carloads) and ARC. Changes in price, traffic mix and fuel surcharges drive ARC. We provide some of our customers with contractual incentives for meeting or exceeding specified cumulative volumes or shipping to and from specific locations, which we record as reductions to freight revenues based on the actual or projected future shipments. We recognize freight revenues as shipments move from origin to destination. We allocate freight revenues between reporting periods based on the relative transit time in each reporting period and recognize expenses as we incur them.

Other revenues include revenues earned by our subsidiaries, revenues from commuter rail operations that we manage, accessorial revenues, which we earn when customers retain equipment owned or controlled by us or when we perform additional services such as switching or storage, and miscellaneous contract revenue. We recognize other revenues as we perform services or meet contractual obligations.

Freight revenues for four of the six commodity groups increased during the second quarter of 2013 and five of the six increased during the year-to-date period of 2013 compared to 2012, driven by core pricing gains, partially offset by an overall decline in carloads. Substantial volume declines in agricultural products offset strong chemical, automotive and domestic intermodal shipments in the second quarter. Year-to-date, declines in coal shipments also contributed to the decrease in carloads.

Each of our commodity groups includes revenue from fuel surcharges. Freight revenues from fuel surcharge programs were $665 million and $1.3 billion in the second quarter and year-to-date periods of 2013, compared to $685 and $1.3 billion in the same periods of 2012. Lower fuel surcharge recoveries, due to lower fuel prices along with lower volumes, drove the decrease in the second quarter of 2013 from

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2012. Year-to-date, fuel surcharge revenue was essentially flat as lower volume was offset by the lag impact of our programs.

In the second quarter of 2013, other revenues increased from 2012 due to miscellaneous contract revenue and higher revenues at our subsidiaries that broker intermodal and automotive services.

The following tables summarize the year-over-year changes in freight revenues, revenue carloads, and ARC by commodity type:

Freight Revenues	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
Millions	2013		2012				2013		2012
Agricultural	$	784	$	854		(8)%	$	1,568	$	1,712		(8)%
Automotive		534		475		12		1,021		905		13
Chemicals		890		795		12		1,763		1,563		13
Coal		975		869		12		1,911		1,864		3
Industrial Products		977		917		7		1,893		1,780		6
Intermodal		993		1,003		(1)		1,981		1,912		4
Total	$	5,153	$	4,913		5%	$	10,137	$	9,736		4%
Revenue Carloads	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
Thousands	2013		2012				2013		2012
Agricultural		209		233		(10)%		421		467		(10)%
Automotive		197		190		4		381		370		3
Chemicals		287		261		10		558		502		11
Coal		414		412		-		816		907		(10)
Industrial Products		317		316		-		606		606		-
Intermodal [a]		822		846		(3)		1,632		1,624		-
Total		2,246		2,258		(1)%		4,414		4,476		(1)%
	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
Average Revenue per Car	2013		2012				2013		2012
Agricultural	$	3,750	$	3,665		2%	$	3,721	$	3,665		2%
Automotive		2,715		2,505		8		2,683		2,449		10
Chemicals		3,098		3,044		2		3,160		3,111		2
Coal		2,353		2,109		12		2,341		2,055		14
Industrial Products		3,079		2,907		6		3,124		2,941		6
Intermodal [a]		1,210		1,185		2		1,214		1,177		3
Average	$	2,295	$	2,176		5%	$	2,297	$	2,175		6%

[a] Each intermodal container or trailer equals one carload.

Agricultural Products – Lower volume, partially offset by price improvements, reduced freight revenue from agricultural shipments in the second quarter and year-to-date periods of 2013 versus 2012. Corn shipments decreased 20% and 25% in the second quarter and year-to-date periods of 2013 versus 2012, reflecting the impact of the severe drought in 2012 that affected territory served by us. The tight supply of corn contributed to lower livestock counts and exports to Mexico, driving the volume decline. Ethanol shipments increased in the second quarter of 2013 versus 2012, but remained down for the year to date period.

Automotive – Higher ARC due to price increases, fuel surcharge, and a new logistics management arrangement that covers fees and container costs, coupled with increased shipments of finished vehicles and automotive parts, improved automotive revenue in the second quarter and year-to-date periods of

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2013 compared to 2012. Higher production and auto sales, currently at a five-year high, drove the growth as the automobile industry continued gaining momentum.

Chemicals – Higher volume and core price improvements increased freight revenue from chemicals in the second quarter and year-to-date periods of 2013 versus 2012. Shipments of crude oil from the Bakken, Permian and Eagle Ford shale formations, primarily to the Gulf area drove the growth in shipments of chemicals for the year to date period. Shipments of liquid petroleum gases increased due to strong demand from eastern origins to Louisiana and new business secured for shipments to the Gulf Coast. In addition, shipments of petroleum products and industrial chemicals increased 11% and 6%, respectively, in the second quarter of 2013 compared to 2012.

Coal – Higher ARC driven by pricing gains and positive business mix, increased freight revenue from coal shipments in the second quarter of 2013 compared to 2012. Year-to-date, higher ARC offset the volume declines, resulting in increased freight revenue in 2013. Shipments from Southern Powder River Basin (SPRB) increased 1% from second quarter 2012 as an easier year-over-year comparison was mostly offset by significant plant outages and the loss of a customer contract at the beginning of the year. Increasing natural gas prices in the second quarter improved demand for coal. However, SPRB shipments were 10% lower than last year for the first half of the year. First quarter declines driven by mine production issues, high inventory levels and loss of a customer contract more than offset the second quarter gains. Shipments from Colorado and Utah mines decreased 11% and 13%, from the second quarter and first half of 2012, respectively, driven by high coal stockpiles, soft international demand and mine production issues.

Industrial Products – Freight revenue from industrial products increased in the second quarter and year-to-date periods of 2013 versus 2012 driven by higher ARC due to pricing gains along with positive business mix. Shipments of non-metallic minerals (primarily frac sand) grew as a result of drilling activity for energy products. Additionally, growth in new housing construction and home improvements drove an increase in lumber shipments. A decline in hazardous waste and ferrous scrap shipments from 2012 affect these volume increases.

Intermodal – Volume declines, partially offset by pricing gains, decreased freight revenue from intermodal shipments in the second quarter of 2013 compared to the same period in 2012. Pricing gains and positive business mix increased freight revenue year-to-date. International shipments declined 8% and 1%, from the second quarter and first half of 2012, respectively, offsetting the increases in the first quarter due to slowing worldwide economic growth and strong results in 2012. Domestic traffic for the quarter and year-to-date periods increased 3% and 2%, respectively, driven by conversions from truck to rail.

Mexico Business – Each of our commodity groups includes revenue from shipments to and from Mexico. Revenue from Mexico business increased 3% to $519 million in the second quarter of 2013 versus the same period in 2012. Volume levels declined 2% in aggregate versus 2012 despite higher carloads from four of our six commodity groups. Declining agricultural products and intermodal shipments offset strong growth in chemicals and industrial products. Year-to-date, revenue grew 4% versus 2012 to $1.0 billion, driven by higher ARC and strong volume growth in industrial products and automotives shipments. Lower shipments of agricultural products partially offset revenue growth during the first half of 2013.

Operating Expenses

	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
Millions	2013		2012				2013		2012
Compensation and benefits	$	1,185	$	1,151		3%	$	2,401	$	2,362		2%
Fuel		863		882		(2)		1,763		1,808		(2)
Purchased services and materials		585		542		8		1,142		1,068		7
Depreciation		438		433		1		872		860		1
Equipment and other rents		302		299		1		615		595		3
Other		219		190		15		456		406		12
Total	$	3,592	$	3,497		3%	$	7,249	$	7,099		2%

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Operating expenses increased $95 million and $150 million in the second quarter and six-month periods of 2013, respectively, versus 2012. Wage and benefit inflation, personal injury expense, new logistics management fees and container costs for automotive business, short-term freight car rental costs, locomotive overhauls and property taxes contributed to higher expenses during the periods. Lower fuel prices offset the cost increases.

Compensation and Benefits – Compensation and benefits include wages, payroll taxes, health and welfare costs, pension costs, other postretirement benefits, and incentive costs. General wage and benefit inflation, higher employment levels and increased pension and other postretirement benefits drove the increases in the second quarter and year-to-date periods of 2013 versus 2012. Lower volumes during both periods partially offset these increases.

Fuel – Fuel includes locomotive fuel and gasoline for highway and non-highway vehicles and heavy equipment. Locomotive diesel fuel prices, which averaged $3.10 per gallon (including taxes and transportation costs) in the second quarter of 2013 compared to $3.21 per gallon in the same period in 2012, reduced expenses $30 million. For the six month period, lower locomotive diesel fuel prices that averaged $3.16 per gallon versus $3.22 per gallon in 2012, reduced expenses by $31 million. In the second quarter, fuel costs were higher as gross-ton miles increased slightly and the fuel consumption rate, computed as gallons of fuel consumed divided by gross ton-miles in thousands, increased 2% compared to 2012. Year-to-date, fuel costs were lower as gross-ton miles declined 3%, mostly offset by a 2% increase in the fuel consumption rate. Declines in heavier, more fuel-efficient coal shipments drove the variances in gross-ton-miles and fuel consumption rate.

Purchased Services and Materials – Expense for purchased services and materials includes the costs of services purchased from outside contractors (including equipment maintenance and contract expenses incurred by our logistics subsidiaries for external transportation services); materials used to maintain the Railroad’s lines, structures, and equipment; costs of operating facilities jointly used by UPRR and other railroads; transportation and lodging for train crew employees; trucking and contracting costs for intermodal containers; leased automobile maintenance expenses; and tools and supplies. Contract services increased 11% and 12% compared to the second quarter and year-to-date periods of 2012, respectively, primarily due to increased locomotive overhauls and new logistics management fees.

Depreciation – The majority of depreciation relates to road property, including rail, ties, ballast, and other track material. A higher depreciable asset base, reflecting higher ongoing capital spending, increased depreciation expense in the second quarter and year-to-date periods of 2013 compared to the same periods in 2012, partially offset by changes in estimated equipment service lives as a result of recent depreciation studies.

Equipment and Other Rents – Equipment and other rents expense primarily includes rental expense that the Railroad pays for freight cars owned by other railroads or private companies; freight car, intermodal, and locomotive leases; other rent expenses; and office and other rentals. Additional container costs resulting from a new logistics management arrangement, increased automotive shipments and higher freight car rental rates drove an $11 million and $31 million increase in our short-term freight car rental expense in the second quarter and year-to-date periods of 2013, respectively, compared to the same periods in 2012. Conversely, lower locomotive and freight car lease expenses compared to 2012 partially offset the higher freight car rental expense.

Other – Other expenses include personal injury, freight and property damage, destruction of equipment owned by others, insurance, environmental, bad debt, state and local taxes, utilities, telephone and cellular, employee travel, computer software, and other general expenses. Other costs in the second quarter were higher than 2012 as higher personal injury, property tax and damaged freight and property costs more than offset lower destroyed equipment costs. Personal injury expense increased as the reduction of the liability for prior years based on our recent actuarial study was less than the reduction from our 2012 study. Year-to-date, higher property tax, damaged freight and property and personal injury costs drove the increase from the same period in 2012.

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Non-Operating Items

	Three Months Ended June 30,				% Change		Six Months Ended June 30,				% Change
Millions	2013		2012				2013		2012
Other income		$        23		$        21		10 %		$        63		$        37		70 %
Interest expense		(133)		(135)		(1)		(261)		(270)		(3)
Income taxes		(662)		(608)		9		(1,250)		(1,136)		10

Other Income – Other income increased slightly in the second quarter of 2013 versus 2012. Year-to-date, other income increased due to a favorable $17 million land lease contract settlement and lower environmental expenses.

Interest Expense – Interest expense decreased in the second quarter of 2013 versus 2012 due to a lower effective interest rate of 5.5% versus 6.0%, partially offset by an increased weighted-average debt level of $9.8 billion in 2013 versus $9.0 billion in 2012. A lower effective interest rate of 5.6% versus 6.1% drove the decline in interest for the year-to-date period of 2013 compared to the same period of 2012. The increase in the weighted-average debt level to $9.5 billion in 2013 from $8.9 billion in 2012 partially offset the impact of the lower effective interest rate.

Income Taxes – Higher pre-tax income increased income taxes in the second quarter and year-to-date periods of 2013 compared to 2012. Our effective tax rate for the second quarter of 2013 was 37.4% compared to 37.8% in 2012. Our 2013 year-to-date effective tax rate was 37.7% compared to 37.9% in 2012.

OTHER OPERATING/PERFORMANCE AND FINANCIAL STATISTICS

We report key Railroad performance measures weekly to the Association of American Railroads (AAR), including carloads, average daily inventory of rail cars on our system, average train speed, and average terminal dwell time. We provide this data on our website at www.up.com/investors/reports/index.shtml.

Operating/Performance Statistics

Railroad performance measures reported to the AAR, as well as other performance measures, are included in the table below:

	Three Months Ended June 30,				%     Change			Six Months Ended June 30,				%     Change
	2013		2012					2013		2012
Average train speed (miles per hour)		25.7		26.6		(3)%			26.1		26.5		(2)%
Average terminal dwell time (hours)		26.6		25.5		4 %			27.0		26.0		4 %
Average rail car inventory (thousands)		261.6		268.6		(3)%			262.7		272.0		(3)%
Gross ton-miles (billions)		235.4		234.5		- %			463.1		475.0		(3)%
Revenue ton-miles (billions)		127.4		126.6		1 %			251.4		259.3		(3)%
Operating ratio		65.7		67.0		(1.3)pt	s		67.4		68.7		(1.3)pt	s
Employees (average)		46,787		45,797		2 %			46,612		45,720		2 %
Customer satisfaction index		93		93		- pt	s		93		93		- pt	s

Average Train Speed – Average train speed is calculated by dividing train miles by hours operated on our main lines between terminals. Average train speed, as reported to the Association of American Railroads (AAR), declined 3% and 2% in the second quarter and year-to-date periods of 2013 versus 2012, respectively. The declines were due to weather and incident interruptions and increased work on capital projects in higher volume corridors.

Average Terminal Dwell Time – Average terminal dwell time is the average time that a rail car spends at our terminals. Lower average terminal dwell time improves asset utilization and service. Average terminal dwell time increased 4% in both the second quarter and year-to-date periods of 2013 compared to 2012,

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primarily due to continuing growth of manifest traffic concentrated in the Southern Region, which requires more time in terminals for building trains and removing cars from trains.

Average Rail Car Inventory – Average rail car inventory is the daily average number of rail cars on our lines, including rail cars in storage. Traffic volumes and rail car productivity influence inventory levels. Productivity may be improved through faster train speeds, lower terminal dwell, lower customer dwell and lower hold dwell. Average rail car inventory decreased 3% in both the second quarter and year-to-date periods of 2013 compared to 2012, as volume declined 1% in both periods, despite a shift in traffic mix to more manifest shipments, which have longer cycle times.

Gross and Revenue Ton-Miles – Gross ton-miles are calculated by multiplying the weight of loaded and empty freight cars by the number of miles hauled. Revenue ton-miles are calculated by multiplying the weight of freight by the number of tariff miles. Gross ton-miles declined 3% during the first half of 2013 compared to the same period in 2012, while revenue ton-miles decreased 3% and carloads declined 1%. Changes in commodity mix drove the variance in year-over-year declines between gross ton-miles, revenue ton-miles and carloads.

Operating Ratio – Operating ratio is our operating expenses reflected as a percentage of operating revenue. Our operating ratio improved 1.3 points to a record low 65.7% in the second quarter of 2013 versus the same period of 2012 and 1.3 points to 67.4% in the six-month period of 2013 versus 2012. Core pricing gains more than offset the impact of inflation and lower volume in both periods.

Employees – Employee levels increased 2% in both the second quarter and six-month period of 2013 compared to the same periods in 2012, driven by a shift in our traffic mix, which requires more resources, largely concentrated in the Southern region. In addition, increased work on capital projects, including positive train control, contributed to the higher employee levels.

Customer Satisfaction Index – Our customer satisfaction survey asks customers to rate how satisfied they are with our performance over the last 12 months on a variety of attributes. A higher score indicates higher customer satisfaction. An improvement in survey results generally reflects customer recognition of our service quality.

Debt to Capital / Adjusted Debt to Capital

Millions, Except Percentages	June 30, 2013		Dec. 31, 2012
Debt (a)	$	9,809	$	8,997
Equity		20,524		19,877
Capital (b)	$	30,333	$	28,874
Debt to capital (a/b)		32.3%		31.2%
Millions, Except Percentages	June 30, 2013		Dec. 31, 2012
Debt	$	9,809	$	8,997
Net present value of operating leases		3,038		3,096
Unfunded pension and OPEB		629		679
Adjusted debt (a)		13,476		12,772
Equity		20,524		19,877
Adjusted capital (b)	$	34,000	$	32,649
Adjusted debt to capital (a/b)		39.6%		39.1%

Adjusted debt to capital is a non-GAAP financial measure under SEC Regulation G and Item 10 of SEC Regulation S-K, and may not be defined and calculated by other companies in the same manner. We believe this measure is important to management and investors in evaluating the total amount of leverage in our capital structure, including off-balance sheet lease obligations, which we generally incur in connection with financing the acquisition of locomotives and freight cars and certain facilities. Operating leases were discounted using 5.6% at June 30, 2013, and 6.0% at December 31, 2012. The discount rate

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reflects our effective interest rate. We monitor the ratio of adjusted debt to capital as we manage our capital structure to balance cost-effective and efficient access to the capital markets with the Corporation’s overall cost of capital. Adjusted debt to capital should be considered in addition to, rather than as a substitute for, debt to capital. The tables above provide reconciliations from debt to capital to adjusted debt to capital.

LIQUIDITY AND CAPITAL RESOURCES

Financial Condition

Cash Flows Millions, for the Six Months Ended June 30	2013		2012
Cash provided by operating activities	$	3,218	$	2,776
Cash used in investing activities		(1,739)		(1,882)
Cash used in financing activities		(697)		(910)
Net change in cash and cash equivalents	$	782	$	(16)

Operating Activities

Higher net income and lower income tax payments in the first six months of 2013 increased cash provided operating activities compared to the same period of 2012. In addition, 2012 included payments for past wages as a result of national labor negotiations.

Investing Activities

Lower capital investments in the first six months of 2013 drove the decrease in cash used in investing activities due to the timing of these expenditures versus 2012.

The table below details cash capital investments:

Millions, for the Six Months Ended June 30,	2013		2012
Rail and other track material	$	378	$	371
Ties		243		227
Ballast		105		104
Other [a]		112		111
Total road infrastructure replacements		838		813
Line expansion and other capacity projects		213		212
Commercial facilities		48		71
Total capacity and commercial facilities		261		283
Locomotives and freight cars		366		467
Positive train control		208		161
Technology and other		57		92
Total cash capital investments	$	1,730	$	1,816

[a] Other includes bridges and tunnels, signals, other road assets, and road work equipment.

Financing Activities

Cash used in financing activities decreased in the first six months of 2013 versus the same period of 2012, reflecting the increase in debt issued in 2013, $944 million compared to $695 million in 2012. Higher dividend payments of $646 million in 2013 compared to $575 million in 2012, due to higher dividends per share, partially offset the increased debt issuances.

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Free Cash Flow – Free cash flow is defined as cash provided by operating activities less cash used in investing activities and dividends paid. Free cash flow was higher in 2013 due to higher net income and lower capital investments.

Free cash flow is not considered a financial measure under accounting principles generally accepted in the U.S. (GAAP) by SEC Regulation G and Item 10 of SEC Regulation S-K and may not be defined and calculated by other companies in the same manner. We believe free cash flow is important to management and investors in evaluating our financial performance and measures our ability to generate cash without additional external financings. Free cash flow should be considered in addition to, rather than as a substitute for, cash provided by operating activities. The following table reconciles cash provided by operating activities (GAAP measure) to free cash flow (non-GAAP measure):

Millions, for the Six Months Ended June 30,	2013		2012
Cash provided by operating activities	$	3,218	$	2,776
Cash used in investing activities		(1,739)		(1,882)
Dividends paid		(646)		(575)
Free cash flow	$	833	$	319

Credit Facilities – At June 30, 2013, we had $1.8 billion of credit available under our revolving credit facility (the facility), which is designated for general corporate purposes and supports the issuance of commercial paper. We did not draw on the facility at any time during the six months ended June 30, 2013. Commitment fees and interest rates payable under the facility are similar to fees and rates available to comparably rated, investment-grade borrowers. The facility allows for borrowings at floating rates based on London Interbank Offered Rates, plus a spread, depending upon our senior unsecured debt ratings. The facility matures in 2015 under a four year term and requires the Corporation to maintain a debt-to-net-worth coverage ratio as a condition to making a borrowing. At June 30, 2013, and December 31, 2012 (and at all times during the first and second quarters), we were in compliance with this covenant.

The definition of debt used for purposes of calculating the debt-to-net-worth coverage ratio includes, among other things, certain credit arrangements, capital leases, guarantees and unfunded and vested pension benefits under Title IV of ERISA. At June 30, 2013, the debt-to-net-worth coverage ratio allowed us to carry up to $41 billion of debt (as defined in the facility), and we had $10.4 billion of debt (as defined in the facility) outstanding at that date. Under our current capital plans, we expect to continue to satisfy the debt-to-net-worth coverage ratio; however, many factors beyond our reasonable control could affect our ability to comply with this provision in the future. The facility does not include any other financial restrictions, credit rating triggers (other than rating-dependent pricing), or any other provision that could require us to post collateral. The facility also includes a $75 million cross-default provision and a change-of-control provision.

During the three and six months ended June 30, 2013, we did not issue or repay any commercial paper, and at June 30, 2013, we had no commercial paper outstanding. Our revolving credit facility supports our outstanding commercial paper balances, and, unless we change the terms of our commercial paper program, our aggregate issuance of commercial paper will not exceed the amount of borrowings available under the facility.

Shelf Registration Statement and Significant New Borrowings – We filed a new automatic shelf registration statement that became effective on February 8, 2013. The Board of Directors authorized the issuance of up to $4 billion of debt securities, replacing the $1.4 billion of authority remaining under our shelf registration filed in February 2010. SEC rules require UPC, a large accelerated filer, to file a new shelf registration statement every three years. Under the current shelf registration, we may issue, from time to time, any combination of debt securities, preferred stock, common stock, or warrants for debt securities or preferred stock in one or more offerings. We have no immediate plans to issue equity securities; however, we will continue to explore opportunities to replace existing debt or access capital through issuances of debt securities under our shelf registration, and, therefore, we may issue additional debt securities at any time.

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On March 15, 2013, we issued $325 million of 2.75% unsecured fixed-rate notes and $325 million of 4.25% unsecured fixed-rate notes under our shelf registration statement. The 2.75% notes will mature on April 15, 2023, and the 4.25% notes will mature on April 15, 2043. Proceeds from this offering are for general corporate purposes, including the repurchase of common stock pursuant to our share repurchase program. These debt securities include change-of-control provisions. At June 30, 2013, we had remaining authority from our Board of Directors to issue up to $3.35 billion of debt securities under the shelf registration.

At June 30, 2013, and December 31, 2012, we reclassified as long-term debt approximately $400 million and $100 million, respectively, of debt due within one year that we intend to refinance. This reclassification reflects our ability and intent to refinance any short-term borrowings and certain current maturities of long-term debt on a long-term basis.

Debt Redemption – On May 14, 2013, we redeemed all $40 million of our outstanding 5.65% Port of Corpus Christi Authority Revenue Refunding Bonds due December 1, 2022. The redemption resulted in an early extinguishment charge of $1 million during the three months ended June 30, 2013.

Receivables Securitization Facility – The Railroad maintains a $600 million, 364-day receivables securitization facility under which it sells most of its eligible third-party receivables to Union Pacific Receivables, Inc. (UPRI), a wholly-owned, bankruptcy-remote subsidiary that may subsequently transfer, without recourse an undivided interest in accounts receivable to investors. The investors have no recourse to the Railroad’s other assets except for customary warranty and indemnity claims. Creditors of the Railroad do not have recourse to the assets of UPRI.

The amount outstanding under the facility was $400 million and $100 million at June 30, 2013, and December 31, 2012, respectively. The amount outstanding under the facility was supported by $1.2 billion and $1.1 billion of accounts receivable as collateral at June 30, 2013, and December 31, 2012, respectively, which, as a retained interest, is included in accounts receivable, net in our Condensed Consolidated Statements of Financial Position.

The outstanding amounts the Railroad is allowed to maintain under the facility, with a maximum of $600 million, may fluctuate based on the availability of eligible receivables and is directly affected by business volumes and credit risks, including receivables payment quality measures such as default and dilution ratios. If default or dilution ratios increase one percent, amounts allowed to be outstanding under the facility would not materially change.

The costs of the receivables securitization facility include interest, which will vary based on prevailing commercial paper rates, program fees paid to banks, commercial paper issuing costs, and fees for unused commitment availability. The costs of the receivables securitization facility are included in interest expense and were $1 million for the three months ended June 30, 2013, and 2012, and $2 million for the six months ended June 30, 2013, and 2012.

We are currently in the process of renewing the receivables securitization facility for an additional 364-day period at comparable terms and conditions.

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Share Repurchase Program

Effective April 1, 2011, our Board of Directors authorized the repurchase of up to 40 million shares of our common stock by March 31, 2014, replacing our previous repurchase program. As of June 30, 2013, we repurchased a total of $8.0 billion of our common stock since the commencement of our repurchase programs. The table below represents shares repurchased under the new repurchase program.

	Number of Shares Purchased				Average Price Paid
	2013		2012		2013		2012
First quarter		2,881,400		3,917,369		$    136.58		$        110.64
Second quarter		3,061,470		3,770,528		151.42		110.02
Total		5,942,870		7,687,897		144.23		110.33
Remaining number of shares that may be repurchased under current authority								9,093,079

Management’s assessments of market conditions and other pertinent facts guide the timing and volume of all repurchases. We expect to fund any share repurchases under this program through cash generated from operations, the sale or lease of various operating and non-operating properties, debt issuances, and cash on hand. Repurchased shares are recorded in treasury stock at cost, which includes any applicable commissions and fees.

Off-Balance Sheet Arrangements, Contractual Obligations, and Commercial Commitments

As described in the notes to the Condensed Consolidated Financial Statements and as referenced in the tables below, we have contractual obligations and commercial commitments that may affect our financial condition. However, based on our assessment of the underlying provisions and circumstances of our contractual obligations and commercial commitments, including material sources of off-balance sheet and structured finance arrangements, there is no known trend, demand, commitment, event, or uncertainty that is reasonably likely to occur that would have a material adverse effect on our consolidated results of operations, financial condition, or liquidity. In addition, our commercial obligations, financings, and commitments are customary transactions that are similar to those of other comparable corporations, particularly within the transportation industry.

The following tables identify material obligations and commitments as of June 30, 2013:

Contractual Obligations Millions			Jul. 1 through Dec. 31, 2013		Payments Due by Dec. 31,
	Total				2014		2015		2016		2017		After 2017		Other
Debt [a]	$	13,822	$	612	$	924	$	653	$	789	$	921	$	9,923	$	-
Operating leases [b]		4,035		262		463		423		389		353		2,145		-
Capital lease obligations [c]		2,308		150		264		253		232		243		1,166		-
Purchase obligations [d]		5,242		1,735		1,857		378		337		214		689		32
Other postretirement benefits [e]		430		21		44		45		45		46		229		-
Income tax contingencies [f]		114		-		-		-		-		-		-		114
Total contractual obligations	$	25,951	$	2,780	$	3,552	$	1,752	$	1,792	$	1,777	$	14,152	$	146

[a] Excludes capital lease obligations of $1,757 million and unamortized discount of ($365) million. Includes an interest component of $5,405 million.

[b] Includes leases for locomotives, freight cars, other equipment, and real estate.

[c] Represents total obligations, including interest component of $551 million.

[d] Purchase obligations include locomotive maintenance contracts; purchase commitments for fuel purchases, locomotives, ties, ballast, and rail; and agreements to purchase other goods and services. For amounts where we cannot reasonably estimate the year of settlement, they are reflected in the Other column.

[e] Includes estimated other postretirement, medical, and life insurance payments and payments made under the unfunded pension plan for the next ten years.

[f] Future cash flows for income tax contingencies reflect the recorded liabilities and assets for unrecognized tax benefits, including interest and penalties, as of June 30, 2013. For amounts where the year of settlement is uncertain, they are reflected in the Other column.

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Other Commercial Commitments Millions			Jul. 1 through Dec. 31, 2013		Amount of Commitment Expiration by Dec.  31,
	Total				2014		2015		2016		2017		After 2017
Credit facilities [a]	$	1,800	$	-	$	-	$	1,800	$	-	$	-	$	-
Receivables securitization facility [b]		600		600		-		-		-		-		-
Guarantees [c]		307		8		214		12		30		10		33
Standby letters of credit [d]		23		7		16		-		-		-		-
Total commercial commitments	$	2,730	$	615	$	230	$	1,812	$	30	$	10	$	33

[a] None of the credit facility was used as of June 30, 2013.

[b] $400 million of the receivables securitization facility was utilized at June 30, 2013, which is accounted for as debt. The full program matures in July 2013.

[c] Includes guaranteed obligations related to our headquarters building, equipment financings, and affiliated operations.

[d] None of the letters of credit were drawn upon as of June 30, 2013.

OTHER MATTERS

Asserted and Unasserted Claims – Various claims and lawsuits are pending against us and certain of our subsidiaries. We cannot fully determine the effect of all asserted and unasserted claims on our consolidated results of operations, financial condition, or liquidity; however, to the extent possible, where asserted and unasserted claims are considered probable and where such claims can be reasonably estimated, we have recorded a liability. We do not expect that any known lawsuits, claims, environmental costs, commitments, contingent liabilities, or guarantees will have a material adverse effect on our consolidated results of operations, financial condition, or liquidity after taking into account liabilities and insurance recoveries previously recorded for these matters.

Indemnities – Our maximum potential exposure under indemnification arrangements, including certain tax indemnifications, can range from a specified dollar amount to an unlimited amount, depending on the nature of the transactions and the agreements. Due to uncertainty as to whether claims will be made or how they will be resolved, we cannot reasonably determine the probability of an adverse claim or reasonably estimate any adverse liability or the total maximum exposure under these indemnification arrangements. We do not have any reason to believe that we will be required to make any material payments under these indemnity provisions.

Accounting Pronouncements – On February 5, 2013, the FASB issued Accounting Standards Update 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (ASU 2013-02), which adds additional disclosure requirements for items reclassified out of accumulated other comprehensive income. We adopted this ASU during the three months ended March 31, 2013.

CAUTIONARY INFORMATION

Certain statements in this report, and statements in other reports or information filed or to be filed with the SEC (as well as information included in oral statements or other written statements made or to be made by us), are, or will be, forward-looking statements as defined by the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements and information include, without limitation, the statements and information set forth under the caption “Liquidity and Capital Resources” in Item 2 regarding our capital plan and statements under the caption “Off-Balance Sheet Arrangements, Contractual Obligations, and Commercial Commitments”. Forward-looking statements and information also include any other statements or information in this report regarding: expectations as to operational or service improvements; expectations regarding the effectiveness of steps taken or to be taken to improve operations, service, infrastructure improvements, and transportation plan modifications; expectations as to cost savings, revenue growth, and earnings; the time by which goals, targets, or objectives will be achieved; projections, predictions, expectations, estimates, or forecasts as to our business, financial and operational results, future economic performance, and general economic conditions; proposed new products and services; estimates of costs relating to environmental remediation and restoration; estimates and expectations regarding tax matters, expectations that claims, litigation, environmental costs, commitments, contingent liabilities, labor negotiations or agreements, or other matters will not have

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a material adverse effect on our consolidated results of operations, financial condition, or liquidity and any other similar expressions concerning matters that are not historical facts.

Forward-looking statements and information reflect the good faith consideration by management of currently available information, and may be based on underlying assumptions believed to be reasonable under the circumstances. However, such information and assumptions (and, therefore, such forward-looking statements and information) are or may be subject to variables or unknown or unforeseeable events or circumstances over which management has little or no influence or control. The Risk Factors in Item 1A of our 2012 Annual Report on Form 10-K, filed February 8, 2013, could affect our future results and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements, and this report, including this Item 2, should be read in conjunction with these Risk Factors. To the extent circumstances require or we deem it otherwise necessary, we will update or amend these risk factors in a Form 10-Q or Form 8-K. Information regarding new risk factors or material changes to our risk factors, if any, is set forth in Item 1A of Part II of this report. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times that, or by which, such performance or results will be achieved. Forward-looking information is subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements.

Forward-looking statements speak only as of the date the statement was made. We assume no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect thereto or with respect to other forward-looking statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There were no material changes to the Quantitative and Qualitative Disclosures About Market Risk previously disclosed in our 2012 Annual Report on Form 10-K.

Item 4. Controls and Procedures

As of the end of the period covered by this report, the Corporation carried out an evaluation, under the supervision and with the participation of the Corporation’s management, including the Corporation’s Chief Executive Officer (CEO) and Executive Vice President – Finance and Chief Financial Officer (CFO), of the effectiveness of the design and operation of the Corporation’s disclosure controls and procedures pursuant to Exchange Act Rules 13a-15 and 15d-15. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Based upon that evaluation, the CEO and the CFO concluded that, as of the end of the period covered by this report, the Corporation’s disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified by the SEC, and that such information is accumulated and communicated to management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Additionally, the CEO and CFO determined that there were no changes to the Corporation’s internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) during the last fiscal quarter that materially affected, or are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we are involved in legal proceedings, claims, and litigation that occur in connection with our business. We routinely assess our liabilities and contingencies in connection with these matters based upon the latest available information and, when necessary, we seek input from our third-party advisors when making these assessments. Consistent with SEC rules and requirements, we describe below material pending legal proceedings (other than ordinary routine litigation incidental to our

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business), material proceedings known to be contemplated by governmental authorities, other proceedings arising under federal, state, or local environmental laws and regulations (including governmental proceedings involving potential fines, penalties, or other monetary sanctions in excess of $100,000), and such other pending matters that we may determine to be appropriate.

Environmental Matters

We received notices from the EPA and state environmental agencies alleging that we are or may be liable under federal or state environmental laws for remediation costs at various sites throughout the U.S., including sites on the Superfund National Priorities List or state superfund lists. We cannot predict the ultimate impact of these proceedings and suits because of the number of potentially responsible parties involved, the degree of contamination by various wastes, the scarcity and quality of volumetric data related to many of the sites, and the speculative nature of remediation costs.

Information concerning environmental claims and contingencies and estimated remediation costs is set forth in Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies – Environmental, Item 7 of our 2012 Annual Report on Form 10-K.

Other Matters

Antitrust Litigation – As we reported in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2007, 20 rail shippers (many of whom are represented by the same law firms) filed virtually identical antitrust lawsuits in various federal district courts against us and four other Class I railroads in the U.S. (one railroad was eventually dropped from the lawsuit). The original plaintiff filed the first of these claims in the U.S. District Court in New Jersey on May 14, 2007. The total number of complaints stands at 30. These suits allege that the named railroads engaged in price-fixing by establishing common fuel surcharges for certain rail traffic.

In addition to suits filed by direct purchasers of rail transportation, a few of the suits involved plaintiffs alleging that they are or were indirect purchasers of rail transportation and sought to represent a purported class of indirect purchasers of rail transportation that paid fuel surcharges. These complaints added allegations under state antitrust and consumer protection laws. On November 6, 2007, the Judicial Panel on Multidistrict Litigation ordered that all of the rail fuel surcharge cases be transferred to Judge Paul Friedman of the U.S. District Court in the District of Columbia for coordinated or consolidated pretrial proceedings. Following numerous hearings and rulings, Judge Friedman dismissed the complaints of the indirect purchasers, which the indirect purchasers appealed. On April 16, 2010, the U.S. Court of Appeals for the District of Columbia affirmed Judge Friedman’s ruling dismissing the indirect purchasers’ claims based on various state laws.

With respect to the direct purchasers’ complaint, Judge Friedman conducted a two-day hearing on October 6 and 7, 2010, on the class certification issue and the railroad defendants’ motion to exclude evidence of interline communications. On April 7, 2011, Judge Friedman issued an order deferring any decision on class certification until the Supreme Court issued its decision in the Wal-Mart employment discrimination case.

On June 21, 2012, Judge Friedman issued his decision certifying a class of plaintiffs to be represented by eight named plaintiffs. The class includes all shippers that paid a rate-based fuel surcharge to any one of the defendant railroads for rate-unregulated rail transportation from July 1, 2003, through December 1, 2008. This is a procedural ruling, which does not affirm any of the claims asserted by the plaintiffs and does not affect the ability of the railroad defendants to disprove the allegations made by the plaintiffs. On July 5, 2012, the defendant railroads filed a petition with the U.S. Court of Appeals for the District of Columbia requesting that the court review the class certification ruling. On August 28, 2012, a panel of the Circuit Court of the District of Columbia referred the petition to a merits panel of the court to address the issues in the petition and to address whether the district court properly granted class certification. The Circuit Court heard oral arguments on May 3, 2013, and has not issued its decision.

As we reported in our Current Report on Form 8-K, filed on June 10, 2011, the Railroad received a complaint filed in the U.S. District Court for the District of Columbia on June 7, 2011, by Oxbow Carbon & Minerals LLC and related entities (Oxbow). The complaint named the Railroad and one other U.S. Class I Railroad as defendants and alleged that the named railroads engaged in price-fixing and monopolistic

35

practices in connection with fuel surcharge programs and pricing of shipments of certain commodities, including coal and petroleum coke. The complaint sought injunctive relief and payment of damages of over $30 million, and other unspecified damages, including treble damages. Some of the allegations in the complaint were addressed in the existing fuel surcharge litigation referenced above. The complaint also included additional unrelated allegations regarding alleged limitations on competition for shipments of Oxbow’s commodities. Judge Friedman, who presides over the fuel surcharge matter described above, also presides over this matter. On February 26, 2013, Judge Friedman granted the defendants’ motion to dismiss Oxbow’s complaint for failure to state properly a claim under the antitrust laws. However, the dismissal was without prejudice to refile the complaint. Judge Friedman approved a schedule that allowed Oxbow to file a revised complaint, which Oxbow filed on May 1, 2013. The amended complaint alleges that UPRR violated Sections 1 and 2 of the Sherman Antitrust Act and also breached a tolling agreement between Oxbow and UPRR. Oxbow claims that it paid more than $50 million in wrongfully imposed fuel surcharges. UPRR and the other railroad filed separate motions to dismiss the Oxbow revised complaint on July 1, 2013.

We deny the allegations that our fuel surcharge programs violate the antitrust laws or any other laws. We believe that these lawsuits are without merit, and we will vigorously defend our actions. Therefore, we currently believe that these matters will not have a material adverse effect on any of our results of operations, financial condition, and liquidity.

Item 1A. Risk Factors

There were no material changes from the risk factors previously disclosed in our 2012 Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities – The following table presents common stock repurchases during each month for the second quarter of 2013:

Period	Total Number of Shares Purchased [a]		Average Price Paid Per Share		Total Number of Shares Purchased as Part of a Publicly Announced Plan or Program [b]		Maximum Number of Shares That May Be Purchased Under Current Authority [b]
Apr. 1 through Apr. 30		755,420	$	141.39		749,400		11,405,149
May 1 through May 31		808,890		155.63		712,000		10,693,149
Jun. 1 through Jun. 30		1,602,283		154.25		1,600,070		9,093,079
Total		3,166,593		$151.53		3,061,470		N/A

[a] Total number of shares purchased during the quarter includes 105,123 shares delivered or attested to UPC by employees to pay stock option exercise prices, satisfy excess tax withholding obligations for stock option exercises or vesting of retention units, and pay withholding obligations for vesting of retention shares.

[b] On April 1, 2011, our Board of Directors authorized the repurchase of up to 40 million shares of our common stock by March 31, 2014. These repurchases may be made on the open market or through other transactions. Our management has sole discretion with respect to determining the timing and amount of these transactions.

Dividend Restrictions – Our revolving credit facility includes a debt-to-net worth covenant that, under certain circumstances, restricts the payment of cash dividends to our shareholders. The amount of retained earnings available for dividends was $15.3 billion and $15.1 billion at June 30, 2013, and December 31, 2012, respectively.

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Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Other Information

None.

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Item 6. Exhibits

Exhibit No.	Description
Filed with this Statement
12(a)	Ratio of Earnings to Fixed Charges for the Three Months Ended June 30, 2013 and 2012.
12(b)	Ratio of Earnings to Fixed Charges for the Six Months Ended June 30, 2013 and 2012.
31(a)	Certifications Pursuant to Rule 13a-14(a), of the Exchange Act, as Adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - John J. Koraleski.
31(b)	Certifications Pursuant to Rule 13a-14(a), of the Exchange Act, as Adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Robert M. Knight, Jr.
32	Certifications Pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – John J. Koraleski and Robert M. Knight, Jr.
101	eXtensible Business Reporting Language (XBRL) documents submitted electronically: 101.INS (XBRL Instance Document), 101.SCH (XBRL Taxonomy Extension Schema Document), 101.CAL (XBRL Calculation Linkbase Document), 101.LAB (XBRL Taxonomy Label Linkbase Document), 101.DEF (XBRL Taxonomy Definition Linkbase Document) and 101.PRE (XBRL Taxonomy Presentation Linkbase Document). The following financial and related information from Union Pacific Corporation’s Quarterly Report on Form 10-Q for the period ended June 30, 2013 (filed with the SEC on July 19, 2013), is formatted in XBRL and submitted electronically herewith: (i) Condensed Consolidated Statements of Income for the periods ended June 30, 2013 and 2012, (ii) Condensed Consolidated Statements of Comprehensive Income for the periods ended June 30, 2013 and 2012, (iii) Condensed Consolidated Statements of Financial Position at June 30, 2013 and December 31, 2012, (iv) Condensed Consolidated Statements of Cash Flows for the periods ended June 30, 2013 and 2012, (v) Condensed Consolidated Statements of Changes in Common Shareholders’ Equity for the periods ended June 30, 2013 and 2012, and (vi) the Notes to the Condensed Consolidated Financial Statements.
Incorporated by Reference
3(a)	Revised Articles of Incorporation of UPC, as amended through June 27, 2011, are incorporated herein by reference to Exhibit 3(a) to the Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011.
3(b)	By-Laws of UPC, as amended, effective May 14, 2009, are incorporated herein by reference to Exhibit 3.2 to the Corporation’s Current Report on Form 8-K dated May 15, 2009.
10	Union Pacific Corporation 2013 Stock Incentive Plan, effective May 16, 2013, is incorporated herein by reference to Exhibit 4.3 to the Corporation’s Form S-8 dated May 17, 2013.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: July 19, 2013

UNION PACIFIC CORPORATION

(Registrant)

By	/s/ Robert M. Knight, Jr.
	Robert M. Knight, Jr.
	Executive Vice President – Finance and
	Chief Financial Officer
	(Principal Financial Officer)
By	/s/ Jeffrey P. Totusek
	Jeffrey P. Totusek
	Vice President and Controller
	(Principal Accounting Officer)

39

EX-12.(A)

Exhibit 12(a)

RATIO OF EARNINGS TO FIXED CHARGES (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, Except for Ratios for the Three Months Ended June 30,	2013		2012
Fixed charges:
Interest expense including
amortization of debt discount	$	133	$	135
Portion of rentals representing an interest factor		28		34
Total fixed charges	$	161	$	169
Earnings available for fixed charges:
Net income	$	1,106	$	1,002
Equity earnings net of distributions		(16)		(8)
Income taxes		662		608
Fixed charges		161		169
Earnings available for fixed charges	$	1,913	$	1,771
Ratio of earnings to fixed charges		11.9		10.5

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EX-12.(B)

Exhibit 12(b)

RATIO OF EARNINGS TO FIXED CHARGES (Unaudited)

Union Pacific Corporation and Subsidiary Companies

Millions, Except for Ratios for the Six Months Ended June 30,	2013		2012
Fixed charges:
Interest expense including
amortization of debt discount	$	261	$	270
Portion of rentals representing an interest factor		58		68
Total fixed charges	$	319	$	338
Earnings available for fixed charges:
Net income	$	2,063	$	1,865
Equity earnings net of distributions		(17)		(23)
Income taxes		1,250		1,136
Fixed charges		319		338
Earnings available for fixed charges	$	3,615	$	3,316
Ratio of earnings to fixed charges		11.3		9.8

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EX-31.(A)

Exhibit 31(a)

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, John J. Koraleski, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Union Pacific Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 19, 2013

/s/ John J. Koraleski

John J. Koraleski

President and

Chief Executive Officer

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EX-31.(B)

Exhibit 31(b)

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

I, Robert M. Knight, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Union Pacific Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 19, 2013

/s/ Robert M. Knight, Jr.

Robert M. Knight, Jr.

Executive Vice President – Finance and

Chief Financial Officer

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EX-32

Exhibit 32

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying quarterly report of Union Pacific Corporation (the Corporation) on Form 10-Q for the period ending June 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, John J. Koraleski, President and Chief Executive Officer of the Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

By:  /s/ John J. Koraleski

John J. Koraleski

President and

Chief Executive Officer

Union Pacific Corporation

July 19, 2013

A signed original of this written statement required by Section 906 has been provided to the Corporation and will be retained by the Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying quarterly report of Union Pacific Corporation (the Corporation) on Form 10-Q for the period ending June 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Robert M. Knight, Jr., Executive Vice President – Finance and Chief Financial Officer of the Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

By:  /s/ Robert M. Knight, Jr.

Robert M. Knight, Jr.

Executive Vice President - Finance and

Chief Financial Officer

Union Pacific Corporation

July 19, 2013

A signed original of this written statement required by Section 906 has been provided to the Corporation and will be retained by the Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

44

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Earnings Per Share

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

8. Earnings Per Share

The following table provides a reconciliation between basic and diluted earnings per share:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions, Except Per Share Amounts	2013		2012		2013		2012
Net income	$	1,106	$	1,002	$	2,063	$	1,865
Weighted-average number of shares outstanding:
Basic		465.3		473.8		466.6		475.8
Dilutive effect of stock options		1.3		1.4		1.4		1.4
Dilutive effect of retention shares and units		1.0		2.0		1.1		2.1
Diluted		467.6		477.2		469.1		479.3
Earnings per share – basic	$	2.38	$	2.11	$	4.42	$	3.92
Earnings per share – diluted	$	2.37	$	2.10	$	4.40	$	3.89
Stock options excluded as their inclusion would be antidilutive		0.6		0.6		0.5		0.5

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Debt (Details 3) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended		0 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	May 14, 2013 5.65% Notes Due 2022 [Member]
Debt Redemption [Line Items]
Debt redemption					$ 40
Interest rate on note					5.65%
Due date of debt					Dec. 01, 2022
Early extinguishment of debt	$ (1)	$ (2)	$ (1)	$ (2)	$ (1)

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Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parentheticals) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parentheticals) [Abstract]
Deferred taxes activity other comprehensive income/(loss)	$ 13	$ (9)	$ 25	$ (1)

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Basis Of Presentation

6 Months Ended

Jun. 30, 2013

Basis of Presentation [Abstract]

Basis of Presentation [Text Block]

For purposes of this report, unless the context otherwise requires, all references herein to the “Corporation”, “UPC”, “we”, “us”, and “our” mean Union Pacific Corporation and its subsidiaries, including Union Pacific Railroad Company, which will be separately referred to herein as “UPRR” or the “Railroad”.

1.Basis of Presentation

Our Condensed Consolidated Financial Statements are unaudited and reflect all adjustments (consisting of normal and recurring adjustments) that are, in the opinion of management, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (GAAP). Our Consolidated Statement of Financial Position at December 31, 2012, is derived from audited financial statements. This Quarterly Report on Form 10-Q should be read in conjunction with our Consolidated Financial Statements and notes thereto contained in our 2012 Annual Report on Form 10-K. The results of operations for the six months ended June 30, 2013, are not necessarily indicative of the results for the entire year ending December 31, 2013.

The Condensed Consolidated Financial Statements are presented in accordance withGAAP as codified in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC).

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Variable Interest Entities

6 Months Ended

Jun. 30, 2013

Variable Interest Entities [Abstract]

Variable Interest Entities [Text Block]

15. Variable Interest Entities

We have entered into various lease transactions in which the structure of the leases contain variable interest entities (VIEs). These VIEs were created solely for the purpose of doing lease transactions (principally involving railroad equipment and facilities, including our headquarters building) and have no other activities, assets or liabilities outside of the lease transactions. Within these lease arrangements, we have the right to purchase some or all of the assets at fixed prices. Depending on market conditions, fixed-price purchase options available in the leases could potentially provide benefits to us; however, these benefits are not expected to be significant.

We maintain and operate the assets based on contractual obligations within the lease arrangements, which set specific guidelines consistent within the railroad industry. As such, we have no control over activities that could materially impact the fair value of the leased assets. We do not hold the power to direct the activities of the VIEs and, therefore, do not control the ongoing activities that have a significant impact on the economic performance of the VIEs. Additionally, we do not have the obligation to absorb losses of the VIEs or the right to receive benefits of the VIEs that could potentially be significant to the VIEs.

We are not considered to be the primary beneficiary and do not consolidate these VIEs because our actions and decisions do not have the most significant effect on the VIE's performance and our fixed-price purchase price options are not considered to be potentially significant to the VIEs. The future minimum lease payments associated with the VIE leases totaled $3.4 billion as of June 30, 2013.

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Share Repurchase Program (Details) (USD $) In Billions, except Share data, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2013	Mar. 31, 2013	Jun. 30, 2012	Mar. 31, 2012	Jun. 30, 2013	Jun. 30, 2012
Shares Repurchased [Abstract]
BOD authorized	40,000,000				40,000,000
Share repurchases (Note 17) (shares)	3,061,470	2,881,400	3,770,528	3,917,369	5,942,870	7,687,897
Average purchase price	$ 151.42	$ 136.58	$ 110.02	$ 110.64	$ 144.23	$ 110.33
Remaining number of shares that may be repurchased under current authority	9,093,079				9,093,079
Stock repurchased since inception	$ 8.0				$ 8.0

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Accumulated Other Comprehensive Income/(Loss)

6 Months Ended

Jun. 30, 2013

Accumulated Other Comprehensive Income/(Loss) [Abstract]

Accumulated Other Comprehensive Income/(Loss) [Text Block]

9. Accumulated Other Comprehensive Income/(Loss)

Reclassifications out of accumulated other comprehensive income/(loss) for the three and six months ended June 30, 2013, and 2012, were as follows (net of tax):

Millions			Defined benefit plans		Foreign currency translation		Derivatives		Total
Balance at April 1, 2013		$	(1,135)	$	(33)	$	(1)	$	(1,169)
Other comprehensive income/(loss) before reclassifications			1		4		-		5
Amounts reclassified from accumulated other comprehensive income/(loss) [a]			16		-		-		16
Net quarter-to-date other comprehensive income/(loss), net of taxes of $13 million			17		4		-		21
Balance at June 30, 2013		$	(1,118)	$	(29)	$	(1)	$	(1,148)
Balance at April 1, 2012		$	(1,011)	$	(33)	$	(2)	$	(1,046)
Other comprehensive income/(loss) before reclassifications			-		(15)		-		(15)
Amounts reclassified from accumulated other comprehensive income/(loss)			-		-		-		-
Net quarter-to-date other comprehensive income/(loss), net of taxes of ($9) million			-		(15)		-		(15)
Balance at June 30, 2012		$	(1,011)	$	(48)	$	(2)	$	(1,061)
[a]	The accumulated other comprehensive income/(loss) reclassification components are 1) prior service cost/(benefit) and 2) net actuarial loss which are both included in the computation of net periodic pension cost. See Note 5 Retirement Plans for additional details.

Millions			Defined benefit plans		Foreign currency translation		Derivatives		Total
Balance at January 1, 2013		$	(1,149)	$	(36)	$	(1)	$	(1,186)
Other comprehensive income/(loss) before reclassifications			(2)		7		-		5
Amounts reclassified from accumulated other comprehensive income/(loss) [a]			33		-		-		33
Net year-to-date other comprehensive income/(loss), net of taxes of $25 million			31		7		-		38
Balance at June 30, 2013		$	(1,118)	$	(29)	$	(1)	$	(1,148)
Balance at January 1, 2012		$	(1,004)	$	(48)	$	(2)	$	(1,054)
Other comprehensive income/(loss) before reclassifications			(7)		-		-		(7)
Amounts reclassified from accumulated other comprehensive income/(loss)			-		-		-		-
Net year-to-date other comprehensive income/(loss), net of taxes of ($1) million			(7)		-		-		(7)
Balance at June 30, 2012		$	(1,011)	$	(48)	$	(2)	$	(1,061)
[a]	The accumulated other comprehensive income/(loss) reclassification components are 1) prior service cost/(benefit) and 2) net actuarial loss which are both included in the computation of net periodic pension cost. See Note 5 Retirement Plans for additional details.

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Properties (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended		12 Months Ended
	Jun. 30, 2013		Dec. 31, 2012
Property, Plant and Equipment [Line Items]
Cost	$ 58,483		$ 57,279
Accumulated depreciation	15,572		15,282
Net book value	42,911		41,997
Land [Member]
Property, Plant and Equipment [Line Items]
Cost	5,100		5,105
Net book value	5,100		5,105
Road: Rail and Other Track Material [Member]
Property, Plant and Equipment [Line Items]
Cost	13,519		13,220
Accumulated depreciation	4,869		4,756
Net book value	8,650		8,464
Estimated useful life	35 years		33 years
Road: Ties [Member]
Property, Plant and Equipment [Line Items]
Cost	8,608		8,404
Accumulated depreciation	2,227		2,157
Net book value	6,381		6,247
Estimated useful life	33 years		33 years
Road: Ballast [Member]
Property, Plant and Equipment [Line Items]
Cost	4,491		4,399
Accumulated depreciation	1,127		1,085
Net book value	3,364		3,314
Estimated useful life	34 years		34 years
Road: Other Roadway [Member]
Property, Plant and Equipment [Line Items]
Cost	14,989	[1]	14,806	[1]
Accumulated depreciation	2,651	[1]	2,583	[1]
Net book value	12,338	[1]	12,223	[1]
Estimated useful life	48 years	[1]	49 years	[1]
Total Road [Member]
Property, Plant and Equipment [Line Items]
Cost	41,607		40,829
Accumulated depreciation	10,874		10,581
Net book value	30,733		30,248
Equipment: Locomotives [Member]
Property, Plant and Equipment [Line Items]
Cost	7,408		7,297
Accumulated depreciation	3,315		3,321
Net book value	4,093		3,976
Estimated useful life	20 years		19 years
Equipment: Freight Cars [Member]
Property, Plant and Equipment [Line Items]
Cost	2,042		1,991
Accumulated depreciation	1,009		1,018
Net book value	1,033		973
Estimated useful life	25 years		23 years
Equipment: Work Equipment And Other [Member]
Property, Plant and Equipment [Line Items]
Cost	546		535
Accumulated depreciation	105		89
Net book value	441		446
Estimated useful life	19 years		17 years
Total Equipment [Member]
Property, Plant and Equipment [Line Items]
Cost	9,996		9,823
Accumulated depreciation	4,429		4,428
Net book value	5,567		5,395
Technology and Other [Member]
Property, Plant and Equipment [Line Items]
Cost	658		633
Accumulated depreciation	269		273
Net book value	389		360
Estimated useful life	11 years		11 years
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Cost	1,122		889
Accumulated depreciation	0		0
Net book value	$ 1,122		$ 889

[1] Other roadway includes grading, bridges and tunnels, signals, buildings, and other road assets.

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Stock-Based Compensation (Details 1) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Stock-Based Compensation, Before Tax: [Abstract]
Stock options	$ 6	$ 4	$ 10	$ 9
Retention awards	20	20	41	40
Total stock-based compensation, before tax	26	24	51	49
Excess tax benefits from equity compensation plans	$ 19	$ 14	$ 65	$ 53

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Operations And Segmentation (Tables)

6 Months Ended

Jun. 30, 2013

Operations and Segmentation [Abstract]

Freight Revenue By Commodity Group [Table Text Block]

The following table provides freight revenue by commodity group:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions		2013		2012		2013		2012
Agricultural	$	784	$	854	$	1,568	$	1,712
Automotive		534		475		1,021		905
Chemicals		890		795		1,763		1,563
Coal		975		869		1,911		1,864
Industrial Products		977		917		1,893		1,780
Intermodal		993		1,003		1,981		1,912
Total freight revenues		5,153		4,913		10,137		9,736
Other revenues		317		308		623		597
Total operating revenues	$	5,470	$	5,221	$	10,760	$	10,333

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Share Repurchase Program

6 Months Ended

Jun. 30, 2013

Share Repurchase Program [Abstract]

Share Repurchase Program [Text Block]

17. Share Repurchase Program

Effective April 1, 2011, our Board of Directors authorized the repurchase of up to 40 million shares of our common stock by March 31, 2014, replacing our previous repurchase program. As of June 30, 2013, we repurchased a total of $8.0 billion of our common stock since the commencement of our repurchase programs. The table below represents shares repurchased under the new repurchase program.

	Number of Shares Purchased		Average Price Paid
	2013	2012		2013		2012
First quarter	2,881,400	3,917,369	$	136.58	$	110.64
Second quarter	3,061,470	3,770,528		151.42		110.02
Total	5,942,870	7,687,897		144.23		110.33
Remaining number of shares that may be repurchased under current authority						9,093,079

Management's assessments of market conditions and other pertinent facts guide the timing and volume of all repurchases. We expect to fund any share repurchases under this program through cash generated from operations, the sale or lease of various operating and non-operating properties, debt issuances, and cash on hand. Repurchased shares are recorded in treasury stock at cost, which includes any applicable commissions and fees.

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Accumulated Other Comprehensive Income/(Loss) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012		Jun. 30, 2013		Jun. 30, 2012
Accumulated Other Comprehensive Income/(Loss) Net Of Tax [Line Items]
Beginning balance	$ (1,169)		$ (1,046)		$ (1,186)		$ (1,054)
Other comprehensive income/(loss) before reclassifications	5		(15)		5		(7)
Amounts reclassified from accumulated other comprehensive income/(loss)	16	[1]	0		33	[1]	0
Net to-date other comprehensive income/(loss), net of taxes	21	[2]	(15)	[2]	38	[3]	(7)	[3]
Balance at June 30	(1,148)		(1,061)		(1,148)		(1,061)
Defined Benefit Plans [Member]
Accumulated Other Comprehensive Income/(Loss) Net Of Tax [Line Items]
Beginning balance	(1,135)		(1,011)		(1,149)		(1,004)
Other comprehensive income/(loss) before reclassifications	1		0		(2)		(7)
Amounts reclassified from accumulated other comprehensive income/(loss)	16	[1]	0		33	[1]	0
Net to-date other comprehensive income/(loss), net of taxes	17		0		31		(7)
Balance at June 30	(1,118)		(1,011)		(1,118)		(1,011)
Foreign Currency Translation [Member]
Accumulated Other Comprehensive Income/(Loss) Net Of Tax [Line Items]
Beginning balance	(33)		(33)		(36)		(48)
Other comprehensive income/(loss) before reclassifications	4		(15)		7		0
Amounts reclassified from accumulated other comprehensive income/(loss)	0		0		0		0
Net to-date other comprehensive income/(loss), net of taxes	4		(15)		7		0
Balance at June 30	(29)		(48)		(29)		(48)
Derivatives [Member]
Accumulated Other Comprehensive Income/(Loss) Net Of Tax [Line Items]
Beginning balance	(1)		(2)		(1)		(2)
Other comprehensive income/(loss) before reclassifications	0		0		0		0
Amounts reclassified from accumulated other comprehensive income/(loss)	0		0		0		0
Net to-date other comprehensive income/(loss), net of taxes	0		0		0		0
Balance at June 30	$ (1)		$ (2)		$ (1)		$ (2)

[1] The accumulated other comprehensive income/(loss) reclassification components are 1) prior service cost/(benefit) and 2) net actuarial loss which are both included in the computation of net periodic pension cost. See Note 5 Retirement Plans for additional details.

[2] Net of deferred taxes of $13 million and $(9) million during the three months ended June 30, 2013, and 2012, respectively.

[3] Net of deferred taxes of $25 million and $(1) million during the six months ended June 30, 2013, and 2012, respectively.

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Accounts Payable And Other Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2013

Accounts Payable and Other Current Liabilties [Abstract]

Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]

Accounts Payable and Other Current Liabilities

	June 30,		Dec. 31,
Millions	2013		2012
Accounts payable	$	908	$	825
Income and other taxes payable		413		368
Accrued wages and vacation		375		376
Dividends payable		316		318
Accrued casualty costs		224		213
Interest payable		183		172
Equipment rents payable		99		95
Other		574		556
Total accounts payable and other current liabilities	$	3,092	$	2,923

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Stock-Based Compensation(Details 3) (USD $) In Millions, except Share data in Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013
Stock Options [Member]
Stock Option Activity [Abstract]
Stock options, shares outstanding at January 1, 2013	4,289
Stock options, shares granted	572
Stock options, shares exercised	(853)
Stock options, shares forfeited or expired	(22)
Stock options, shares outstanding at June 30, 2013	3,986
Stock options, shares vested or expected to vest at June 30, 2013	3,986
Stock options, shares exercisable at June 30, 2013	2,839
Stock options weighted-average exercise price, outstanding at January 1, 2013	$ 65.68
Stock options weighted-average exercise price, granted	$ 132.00
Stock options weighted-average exercise price, exercised	$ 51.48
Stock options weighted-average exercise price, forfeited or expired	$ 106.00
Stock options weighted-average exercise price, outstanding at June 30, 2013	$ 78.01
Stock options weighted-average exercise price, vested or expected to vest at June 30, 2013	$ 77.99
Stock options weighted-average exercise price, options exercisable at June 30, 2013	$ 61.11
Stock options weighted-average remaining contractual term in years, outstanding at January 1, 2013	5 years 10 months
Stock options weighted-average remaining contractual term in years, outstanding at June 30, 2013	6 years 1 month
Stock options weighted-average remaining contractual term in years, vested or expected to vest at June 30, 2013	6 years 1 month
Stock options weighted-average remaining contractual term in years, options exercisable at June 30, 2013	5 years
Stock options aggregate intrinsic value, outstanding at January 1, 2013	$ 258
Stock options aggregate intrinsic value, outstanding at June 30, 2013	304
Stock options aggregate intrinsic value, vested or expected to vest at June 30, 2013	304
Stock options aggregate intrinsic value, options exercisable at June 30, 2013	265
Unrecognized Compensation Expense [Abstract]
Unrecognized compensation expense	26
Expected weighted-average period (in years) of nonvested stock options to be recognized	1 year 7 months
Retention Awards [Member]
Awards Activity [Abstract]
Awards, shares nonvested at January 1, 2013	2,355
Awards, shares granted	421
Awards, shares vested	(850)
Awards, shares forfeited	(48)
Awards, shares nonvested at June 30, 2013	1,878
Awards weighted-average grant-date fair value, nonvested at January 1, 2013	$ 73.27
Awards weighted-average grant-date fair value, granted	$ 132.02
Awards weighted-average grant-date fair value, vested	$ 47.50
Awards weighted-average grant-date fair value, forfeited	$ 81.74
Awards weighted-average grant-date fair value, nonvested at June 30, 2013	$ 97.89
Unrecognized Compensation Expense [Abstract]
Unrecognized compensation expense	95
Expected weighted-average period (in years) of nonvested stock options to be recognized	2 years
Performance Retention Awards [Member]
Awards Activity [Abstract]
Awards, shares nonvested at January 1, 2013	1,075
Awards, shares granted	304
Awards, shares vested	(401)
Awards, shares forfeited	(32)
Awards, shares nonvested at June 30, 2013	946
Awards weighted-average grant-date fair value, nonvested at January 1, 2013	$ 83.80
Awards weighted-average grant-date fair value, granted	$ 125.14
Awards weighted-average grant-date fair value, vested	$ 58.33
Awards weighted-average grant-date fair value, forfeited	$ 96.85
Awards weighted-average grant-date fair value, nonvested at June 30, 2013	$ 107.44
Unrecognized Compensation Expense [Abstract]
Unrecognized compensation expense	$ 55
Expected weighted-average period (in years) of nonvested stock options to be recognized	1 year 7 months

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Accounts Payable And Other Current Liabilities (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2012
Accounts Payable and Other Current Liabilities Details [Abstract]
Accounts payable	$ 908	$ 825
Income and other taxes payable	413	368
Accrued wages and vacation	375	376
Dividends payable	316	318	280
Accrued casualty costs	224	213
Interest payable	183	172
Equipment rents payable	99	95
Other current liabilities	574	556
Total accounts payable and other current liabilities	$ 3,092	$ 2,923

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

Earnings Per Share [Table Text Block]

The following table provides a reconciliation between basic and diluted earnings per share:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions, Except Per Share Amounts	2013		2012		2013		2012
Net income	$	1,106	$	1,002	$	2,063	$	1,865
Weighted-average number of shares outstanding:
Basic		465.3		473.8		466.6		475.8
Dilutive effect of stock options		1.3		1.4		1.4		1.4
Dilutive effect of retention shares and units		1.0		2.0		1.1		2.1
Diluted		467.6		477.2		469.1		479.3
Earnings per share – basic	$	2.38	$	2.11	$	4.42	$	3.92
Earnings per share – diluted	$	2.37	$	2.10	$	4.40	$	3.89
Stock options excluded as their inclusion would be antidilutive		0.6		0.6		0.5		0.5

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Other Income (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013		Jun. 30, 2012
Other Income Details [Abstract]
Rental income	$ 21	$ 21	$ 58	[1]	$ 41
Net gain on non-operating asset dispositions	0	11	4		12
Early extinguishment of debt	(1)	(2)	(1)		(2)
Non-operating environmental costs and other	3	(9)	2		(14)
Total	23	21	63		37
Land lease contract settlement rental income			$ 17

[1] Rental income includes $17 million related to a land lease contract settlement.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2013

Commitments And Contingencies [Abstract]

Commitments and Contingencies [Text Block]

16.Commitments and Contingencies

Asserted and Unasserted Claims – Various claims and lawsuits are pending against us and certain of our subsidiaries. We cannot fully determine the effect of all asserted and unasserted claims on our consolidated results of operations, financial condition, or liquidity; however, to the extent possible, where asserted and unasserted claims are considered probable and where such claims can be reasonably estimated, we have recorded a liability. We do not expect that any known lawsuits, claims, environmental costs, commitments, contingent liabilities, or guarantees will have a material adverse effect on our consolidated results of operations, financial condition, or liquidity after taking into account liabilities and insurance recoveries previously recorded for these matters.

Personal Injury – The cost of personal injuries to employees and others related to our activities is charged to expense based on estimates of the ultimate cost and number of incidents each year. We use an actuarial analysis to measure the expense and liability, including unasserted claims. The Federal Employers' Liability Act (FELA) governs compensation for work-related accidents. Under FELA, damages are assessed based on a finding of fault through litigation or out-of-court settlements. We offer a comprehensive variety of services and rehabilitation programs for employees who are injured at work.

Our personal injury liability is not discounted to present value due to the uncertainty surrounding the timing of future payments. Approximately 90% of the recorded liability is related to asserted claimsand approximately 10% is related to unasserted claims at June 30, 2013. Because of the uncertainty surrounding the ultimate outcome of personal injury claims, it is reasonably possible that future costs to settle these claims may range from approximately $315to $343 million. We record an accrual at the low end of the range as no amount of loss within the range is more probable than any other. Estimates can vary over time due to evolving trends in litigation.

Our personal injury liability activity was as follows:

Millions,
for the Six Months Ended June 30,	2013		2012
Beginning balance	$	334	$	368
Current year accruals		47		58
Changes in estimates for prior years		(22)		(36)
Payments		(44)		(50)
Ending balance at June 30	$	315	$	340
Current portion, ending balance at June 30	$	90	$	102

Asbestos – We are a defendant in a number of lawsuits in which current and former employees and other parties allege exposure to asbestos. We assess our potential liability using a statistical analysis of resolution costs for asbestos-related claims. This liability is updated annually and excludes future defense and processing costs. The liability for resolving both asserted and unasserted claims was based on the following assumptions:

• The ratio of future claims by alleged disease would be consistent with historical averages adjusted for inflation.
• The number of claims filed against us will decline each year.
• The average settlement values for asserted and unasserted claims will be equivalent to historical averages.
• The percentage of claims dismissed in the future will be equivalent to historical averages.

Our liability for asbestos-related claims is not discounted to present value due to the uncertainty surrounding the timing of future payments. Approximately 23%of the recorded liability related to asserted claims and approximately 77% related to unasserted claims at June 30,2013.

Our asbestos-related liability activity was as follows:

Millions,
for the Six Months Ended June 30,	2013		2012
Beginning balance	$	139	$	147
Accruals		-		-
Payments		(5)		(4)
Ending balance at June 30	$	134	$	143
Current portion, ending balance at June 30	$	8	$	9

We have insurance coverage for a portion of the costs incurred to resolve asbestos-related claims, and we have recognized an asset for estimated insurance recoveries at June 30, 2013, and December 31, 2012.

We believe that our estimates of liability for asbestos-related claims and insurance recoveries are reasonable and probable. The amounts recorded for asbestos-related liabilities and related insurance recoveries were based on currently known facts. However, future events, such as the number of new claims filed each year, average settlement costs, and insurance coverage issues, could cause the actual costs and insurance recoveries to be higher or lower than the projected amounts. Estimates also may vary in the future if strategies, activities, and outcomes of asbestos litigation materially change; federal and state laws governing asbestos litigation increase or decrease the probability or amount of compensation of claimants; and there are material changes with respect to payments made to claimants by other defendants.

EnvironmentalCosts – We are subject to federal, state, and local environmental laws and regulations. We have identified 279 sites at which we are or may be liable for remediation costs associated with alleged contamination or for violations of environmental requirements. This includes 33 sites that are the subject of actions taken by the U.S. government, 17 of which are currently on the Superfund National Priorities List. Certain federal legislation imposes joint and several liability for the remediation of identified sites; consequently, our ultimate environmental liability may include costs relating to activities of other parties, in addition to costs relating to our own activities at each site.

When we identify an environmental issue with respect to property owned, leased, or otherwise used in our business, we perform, with assistance of our consultants, environmental assessments on the property. We expense the cost of the assessments as incurred. We accrue the cost of remediation where our obligation is probable and such costs can be reasonably estimated. We do not discount our environmental liabilities when the timing of the anticipated cash payments is not fixed or readily determinable. At both June 30, 2013, and December 31, 2012, none of our environmental liability was discounted.

Our environmental liability activity was as follows:

Millions,
for the Six Months Ended June 30,	2013		2012
Beginning balance	$	170	$	172
Accruals		19		24
Payments		(21)		(16)
Ending balance at June 30	$	168	$	180
Current portion, ending balance at June 30	$	49	$	47

The environmental liability includes future costs for remediation and restoration of sites, as well as ongoing monitoring costs, but excludes any anticipated recoveries from third parties. Cost estimates are based on information available for each site, financial viability of other potentially responsible parties, and existing technology, laws, and regulations. The ultimate liability for remediation is difficult to determine because of the number of potentially responsible parties, site-specific cost sharing arrangements with other potentially responsible parties, the degree of contamination by various wastes, the scarcity and quality of volumetric data related to many of the sites, and the speculative nature of remediation costs. Estimates of liability may vary over time due to changes in federal, state, and local laws governing environmental remediation. Current obligations are not expected to have a material adverse effect on our consolidated results of operations, financial condition, or liquidity.

Insurance – The Company has a consolidated, wholly-owned captive insurance subsidiary (the captive), that provides insurance coverage for certain risks including FELA claims and property coverage which are subject to reinsurance. The captive entered into annual reinsurancetreaty agreements that insure workers compensation, general liability, auto liability and FELA risk. The captive cedes a portion of its FELA exposure through the treaty and assumes a proportionate share of the entire risk. The captive receives direct premiums, which are netted against the Company's premium costs in other expenses in the Condensed Consolidated Statements of Income. The treaty agreements provide for certain protections against the risk of treaty participants' non-performance, and we do not believe our exposure to treaty participants' non-performance is material at this time. In the event the Company leaves the reinsurance program, the Company is not relieved of its primary obligation to the policyholders for activity prior to the termination of the treaty agreements. We record both liabilities and reinsurance receivables using an actuarial analysis based on historical experience in our Condensed Consolidated Statements of Financial Position.

Guarantees – At bothJune 30,2013, and December 31, 2012, we were contingently liable for $307million in guarantees. We have recorded a liability of $1 million and$2 million for the fair value of these obligations as of June 30,2013, and December 31, 2012, respectively. We entered into these contingent guarantees in the normal course of business, and they include guaranteed obligations related to our headquarters building, equipment financings, and affiliated operations. The final guarantee expires in 2022. We are not aware of any existing event of default that would require us to satisfy these guarantees. We do not expect that these guarantees will have a material adverse effect on our consolidated financial condition, results of operations, or liquidity.

Indemnities – Our maximum potential exposure under indemnification arrangements, including certain tax indemnifications, can range from a specified dollar amount to an unlimited amount, depending on the nature of the transactions and the agreements. Due to uncertainty as to whether claims will be made or how they will be resolved, we cannot reasonably determine the probability of an adverse claim or reasonably estimate any adverse liability or the total maximum exposure under these indemnification arrangements. We do not have any reason to believe that we will be required to make any material payments under these indemnity provisions.

Operating Leases– At June 30, 2013, we had commitments for future minimum lease payments under operating leases with initial or remaining non-cancelable lease terms in excess of one year of approximately $4 billion.

Gain Contingency– UPRR and Santa Fe Pacific Pipelines (SFPP, a subsidiary of Kinder Morgan Energy Partners, L.P.) currently are engaged in a proceeding to resolve the fair market rent payable to UPRR under a 10-year agreement commencing on January 1, 2004, for pipeline easements on UPRR rights-of-way (Union Pacific Railroad Company vs. Santa Fe Pacific Pipelines, Inc., SFPP, L.P., Kinder Morgan Operating L.P. “D” Kinder Morgan G.P., Inc., et al., Superior Court of the State of California for the County of Los Angeles, filed July 28, 2004). In February 2007, a trial began to resolve this issue, and, on September 28, 2011, the judge issued a tentative Statement of Decision, which concluded that SFPP owes back rent to UPRR for the years 2004 through 2011. On May 29, 2012, the court entered judgment, awarding UPRR back rent and prejudgment interest. SFPP is appealing the final judgment. A favorable final judgment may materially affect our results of operations in the period of any monetary recoveries; however, due to the uncertainty regarding the amount and timing of any recovery, including the outcome of SFPP's appeal of this judgment or any subsequent proceeding, we consider this a gain contingency and do not reflect any amounts in the Condensed Consolidated Financial Statements as of June 30, 2013.

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Condensed Consolidated Statements of Financial Position (Unaudited) (Parentheticals) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Condensed Consolidated Statements of Financial Position (Unaudited) (Parentheticals) [Abstract]
Common shares, par value	$ 2.50	$ 2.50
Common shares authorized	800,000,000	800,000,000
Common shares issued	554,840,853	554,558,034
Common shares outstanding	464,363,763	469,465,273

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Condensed Consolidated Statements of Changes in Common Shareholders' Equity (Unaudited) (USD $) In Millions, except Share data, unless otherwise specified	Total USD ($)		Common Shares (Units) [Member]	Treasury Shares (Units) [Member]	Common Shares [Member] USD ($)	Paid-in-Surplus [Member] USD ($)	Retained Earnings [Member] USD ($)	Treasury Stock [Member] USD ($)	Accumulated Other Comprehensive Income/(Loss) (Note 9) [Member] USD ($)
Shareholders' equity, beginning balance at Dec. 31, 2011	$ 18,578				$ 1,386	$ 4,031	$ 19,508	$ (5,293)	$ (1,054)
Common shares, beginning balance at Dec. 31, 2011			554,300,000	(74,400,000)
Comprehensive income [Abstract]
Net income	1,865				0	0	1,865	0	0
Other comp. income/(loss)	(7)	[1]			0	0	0	0	(7)	[1]
Conversion, stock option exercises, forfeitures, and other	70				0	46	0	24	0
Conversion, stock option exercises, forfeitures, and other (shares)			300,000	1,100,000
Share repurchases (Note 17)	(848)				0	0	0	(848)	0
Share repurchases (Note 17) (shares)	(7,687,897)		0	(7,700,000)
Cash dividends declared	(571)				0	0	(571)	0	0
Shareholders' equity, ending balance at Jun. 30, 2012	19,087				1,386	4,077	20,802	(6,117)	(1,061)
Common shares, ending balance at Jun. 30, 2012			554,600,000	(81,000,000)
Shareholders' equity, beginning balance at Dec. 31, 2012	19,877				1,386	4,113	22,271	(6,707)	(1,186)
Common shares, beginning balance at Dec. 31, 2012	469,465,273		554,600,000	(85,100,000)
Comprehensive income [Abstract]
Net income	2,063				0	0	2,063	0	0
Other comp. income/(loss)	38	[1]			0	0	0	0	38	[1]
Conversion, stock option exercises, forfeitures, and other	47				1	49	0	(3)	0
Conversion, stock option exercises, forfeitures, and other (shares)			200,000	600,000
Share repurchases (Note 17)	(857)				0	0	0	(857)	0
Share repurchases (Note 17) (shares)	(5,942,870)		0	(5,900,000)
Cash dividends declared	(644)				0	0	(644)	0	0
Shareholders' equity, ending balance at Jun. 30, 2013	$ 20,524				$ 1,387	$ 4,162	$ 23,690	$ (7,567)	$ (1,148)
Common shares, ending balance at Jun. 30, 2013	464,363,763		554,800,000	(90,400,000)

[1] Net of deferred taxes of $25 million and $(1) million during the six months ended June 30, 2013, and 2012, respectively.

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Accounting Pronouncements

6 Months Ended

Jun. 30, 2013

Accounting Pronouncements [Abstract]

Accounting Pronouncements [Text Block]

2. Adoption of New Accounting Pronouncement

On February 5, 2013, the FASB issued Accounting Standards Update 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (ASU 2013-02), which adds additional disclosure requirements for items reclassified out of accumulated other comprehensive income. We adopted this ASU during the threemonths ended March 31, 2013.

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Condensed Consolidated Statements of Changes in Common Shareholders' Equity (Unaudited) (Parentheticals) (USD $)	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Cash Dividends [Abstract]
Cash dividends declared per share	$ 1.38	$ 1.20

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Stock-Based Compensation (Details 4) (Stock Options [Member], USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Stock Options [Member]
Stock Option Aggregate Disclosures [Abstract]
Intrinsic value of stock options exercised	$ 54	$ 41	$ 82	$ 103
Cash received from option exercises	17	24	31	45
Treasury shares repurchased for employee payroll taxes	(7)	(8)	(12)	(16)
Tax benefit realized from option exercises	21	15	32	39
Aggregate grant-date fair value of stock options vested	$ 0	$ 0	$ 16	$ 16

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Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2013

Stock-Based Compensation [Abstract]

Stock-Based Compensation [Table Text Block]

Information regarding stock-based compensation appears in the table below:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Stock-based compensation, before tax:
Stock options	$	6	$	4	$	10	$	9
Retention awards		20		20		41		40
Total stock-based compensation, before tax	$	26	$	24	$	51	$	49
Excess tax benefits from equity compensation plans	$	19	$	14	$	65	$	53

Stock Options Weight Average Assumptions [Table Text Block]

The table below shows the annual weighted-average assumptions used for valuation purposes:

Weighted-Average Assumptions		2013		2012
Risk-free interest rate		0.8%		0.8%
Dividend yield		2.1%		2.1%
Expected life (years)		5.0		5.3
Volatility		36.2%		36.8%
Weighted-average grant-date fair value of options granted	$	34.98	$	31.29

Stock Options Activity [Table Text Block]

A summary of stock option activity during the six months ended June 30,2013, is presented below:

	Options (thous.)	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value (millions)
Outstanding at January 1, 2013	4,289	$	65.68	5.8 yrs.	$	258
Granted	572		132.00	N/A		N/A
Exercised	(853)		51.48	N/A		N/A
Forfeited or expired	(22)		106.00	N/A		N/A
Outstanding at June 30, 2013	3,986	$	78.01	6.1 yrs.	$	304
Vested or expected to vest at June 30, 2013	3,986	$	77.99	6.1 yrs.	$	304
Options exercisable at June 30, 2013	2,839	$	61.11	5.0 yrs.	$	265

Stock Option Exercises [Table Text Block]

Additional information regarding stock option exercises appears in the table below:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Intrinsic value of stock options exercised	$	54	$	41	$	82	$	103
Cash received from option exercises		17		24		31		45
Treasury shares repurchased for employee payroll taxes		(7)		(8)		(12)		(16)
Tax benefit realized from option exercises		21		15		32		39
Aggregate grant-date fair value of stock options vested		-		-		16		16

Retention Awards Activity [Table Text Block]

Changes in our retention awards during the six months ended June 30,2013, were as follows:

	Shares (thous.)	Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2013	2,355	$	73.27
Granted	421		132.02
Vested	(850)		47.50
Forfeited	(48)		81.74
Nonvested at June 30, 2013	1,878	$	97.89

Performance Retention Awards Present Value Calculation Assumptions [Table Text Block]

The assumptions used to calculate the present value of estimated future dividends related to the February 2013,grant were as follows:

	2013
Dividend per share per quarter	$	0.69
Risk-free interest rate at date of grant		0.4%

Performance Based Units Activity [Table Text Block]

Changes in our performance retention awards during the six months ended June 30, 2013, were as follows:

	Shares (thous.)	Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2013	1,075	$	83.80
Granted	304		125.14
Vested	(401)		58.33
Forfeited	(32)		96.85
Nonvested at June 30, 2013	946	$	107.44

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Accumulated Other Comprehensive Income/(Loss) (Tables)

6 Months Ended

Jun. 30, 2013

Accumulated Other Comprehensive Income/(Loss) [Abstract]

Accumulated Other Comprehensive Income/(Loss) [Table Text Block]

Reclassifications out of accumulated other comprehensive income/(loss) for the three and six months ended June 30, 2013, and 2012, were as follows (net of tax):

Millions			Defined benefit plans		Foreign currency translation		Derivatives		Total
Balance at April 1, 2013		$	(1,135)	$	(33)	$	(1)	$	(1,169)
Other comprehensive income/(loss) before reclassifications			1		4		-		5
Amounts reclassified from accumulated other comprehensive income/(loss) [a]			16		-		-		16
Net quarter-to-date other comprehensive income/(loss), net of taxes of $13 million			17		4		-		21
Balance at June 30, 2013		$	(1,118)	$	(29)	$	(1)	$	(1,148)
Balance at April 1, 2012		$	(1,011)	$	(33)	$	(2)	$	(1,046)
Other comprehensive income/(loss) before reclassifications			-		(15)		-		(15)
Amounts reclassified from accumulated other comprehensive income/(loss)			-		-		-		-
Net quarter-to-date other comprehensive income/(loss), net of taxes of ($9) million			-		(15)		-		(15)
Balance at June 30, 2012		$	(1,011)	$	(48)	$	(2)	$	(1,061)
[a]	The accumulated other comprehensive income/(loss) reclassification components are 1) prior service cost/(benefit) and 2) net actuarial loss which are both included in the computation of net periodic pension cost. See Note 5 Retirement Plans for additional details.

Millions			Defined benefit plans		Foreign currency translation		Derivatives		Total
Balance at January 1, 2013		$	(1,149)	$	(36)	$	(1)	$	(1,186)
Other comprehensive income/(loss) before reclassifications			(2)		7		-		5
Amounts reclassified from accumulated other comprehensive income/(loss) [a]			33		-		-		33
Net year-to-date other comprehensive income/(loss), net of taxes of $25 million			31		7		-		38
Balance at June 30, 2013		$	(1,118)	$	(29)	$	(1)	$	(1,148)
Balance at January 1, 2012		$	(1,004)	$	(48)	$	(2)	$	(1,054)
Other comprehensive income/(loss) before reclassifications			(7)		-		-		(7)
Amounts reclassified from accumulated other comprehensive income/(loss)			-		-		-		-
Net year-to-date other comprehensive income/(loss), net of taxes of ($1) million			(7)		-		-		(7)
Balance at June 30, 2012		$	(1,011)	$	(48)	$	(2)	$	(1,061)
[a]	The accumulated other comprehensive income/(loss) reclassification components are 1) prior service cost/(benefit) and 2) net actuarial loss which are both included in the computation of net periodic pension cost. See Note 5 Retirement Plans for additional details.

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Operations And Segmentation (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Commodity Group Information [Line Items]
Freight revenues	$ 5,153	$ 4,913	$ 10,137	$ 9,736
Other revenues	317	308	623	597
Total operating revenues	5,470	5,221	10,760	10,333
Freight revenues - Mexico	519	503	1,024	985
Agriculture [Member]
Commodity Group Information [Line Items]
Freight revenues	784	854	1,568	1,712
Automotive [Member]
Commodity Group Information [Line Items]
Freight revenues	534	475	1,021	905
Chemicals [Member]
Commodity Group Information [Line Items]
Freight revenues	890	795	1,763	1,563
Coal [Member]
Commodity Group Information [Line Items]
Freight revenues	975	869	1,911	1,864
Industrial Products [Member]
Commodity Group Information [Line Items]
Freight revenues	977	917	1,893	1,780
Intermodal [Member]
Commodity Group Information [Line Items]
Freight revenues	$ 993	$ 1,003	$ 1,981	$ 1,912

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Commitments And Contingencies (Details) (USD $) In Millions, unless otherwise specified		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2013 Personal Injury [Member]	Jun. 30, 2012 Personal Injury [Member]	Jun. 30, 2013 Asbestos [Member]	Jun. 30, 2012 Asbestos [Member]	Jun. 30, 2013 Environmental [Member]	Jun. 30, 2012 Environmental [Member]	Jun. 30, 2013 Guarantees [Member]	Dec. 31, 2012 Guarantees [Member]
Liability Activity [Abstract]
Commitments and contingencies, beginning balance at January 1		$ 334	$ 368	$ 139	$ 147	$ 170	$ 172
Accruals		47	58	0	0	19	24
Changes in estimates for prior years		(22)	(36)
Payments		(44)	(50)	(5)	(4)	(21)	(16)
Commitments and contingencies, ending balance at June 30		315	340	134	143	168	180
Commitments and contingencies, current portion, ending balance at June 30		90	102	8	9	49	47
Environmental [Abstract]
Sites identified which we are or may be liable for remediation costs						279
Sites subject of actions taken by the U.S. government						33
Sites on the Superfund National Priorities List						17
Guarantees [Abstract]
Maximum potential amount of guarantee payments								307	307
Recorded liability for fair value of guarantees								1	2
Expiration year of final guarantee								The final guarantee expires in 2022.
Asserted And Unasserted Claims [Abstract]
Percent of liability recorded related to asserted claims		90.00%		23.00%
Percent of liability recorded related to unasserted claims		10.00%		77.00%
Reasonably possible outcome of related claims, range minimum		315
Reasonably possible outcome of related claims, range maximum		343
Future Minimum Lease Payments For Operating Leases [Abstract]
Total minimum operating lease payments	$ 4,000

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Financial Instruments (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Fair Value of Debt Instruments [Abstract]
Fair value of total debt	$ 11,000	$ 11,100
Fair value of total debt in excess of carrying value	1,200	2,100
Debt securities containing call provisions	163	203
Interest Rate Cash Flow Hedges [Abstract]
Change in fair value of cash flow hedges as reported in accumulated other comprehensive loss	1	1
Interest rate cash flow hedges outstanding	$ 0	$ 0

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Earnings Per Share (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Earnings Per Share Details [Abstract]
Net income	$ 1,106	$ 1,002	$ 2,063	$ 1,865
Weighted-Average Number Of Shares Outstanding [Abstract]
Basic	465.3	473.8	466.6	475.8
Dilutive effect of stock options	1.3	1.4	1.4	1.4
Dilutive effect of retention shares and units	1.0	2.0	1.1	2.1
Diluted	467.6	477.2	469.1	479.3
Earnings per share - basic	$ 2.38	$ 2.11	$ 4.42	$ 3.92
Earnings per share - diluted	$ 2.37	$ 2.10	$ 4.40	$ 3.89
Stock options excluded as their inclusion would be antidilutive	0.6	0.6	0.5	0.5

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Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $) In Millions, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012		Jun. 30, 2013		Jun. 30, 2012
Condensed Consolidated Statements of Comprehensive Income (Unaudited) [Abstract]
Net income	$ 1,106		$ 1,002		$ 2,063		$ 1,865
Other comprehensive income/(loss):
Defined benefit plans	17		0		31		(7)
Foreign currency translation	4		(15)		7		0
Total other comprehensive income/(loss)	21	[1]	(15)	[1]	38	[2]	(7)	[2]
Comprehensive income	$ 1,127		$ 987		$ 2,101		$ 1,858

[1] Net of deferred taxes of $13 million and $(9) million during the three months ended June 30, 2013, and 2012, respectively.

[2] Net of deferred taxes of $25 million and $(1) million during the six months ended June 30, 2013, and 2012, respectively.

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Retirement Plans

6 Months Ended

Jun. 30, 2013

Retirement Plans [Abstract]

Retirement Plans [Text Block]

5.Retirement Plans

Pension and Other Postretirement Benefits

Pension Plans – We provide defined benefit retirement income to eligible non-union employees through qualified and non-qualified (supplemental) pension plans. Qualified and non-qualified pension benefits are based on years of service and the highest compensation during the latest years of employment, with specific reductions made for early retirements.

Other Postretirement Benefits (OPEB) – We provide medical and life insurance benefits for eligible retirees. These benefits are funded as medical claims and life insurance premiums are paid.

Expense

Both pension and OPEB expense are determined based upon the annual service cost of benefits (the actuarial cost of benefits earned during a period) and the interest cost on those liabilities, less the expected return on plan assets. The expected long-term rate of return on plan assets is applied to a calculated value of plan assets that recognizes changes in fair value over a five-year period. This practice is intended to reduce year-to-year volatility in pension expense, but it can have the effect of delaying the recognition of differences between actual returns on assets and expected returns based on long-term rate of return assumptions. Differences in actual experience in relation to assumptions are not recognized in net income immediately, but are deferred in accumulated other comprehensive income and, if necessary, amortized as pension or OPEB expense.

The components of our net periodic pension costwere as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Service cost	$	18	$	14	$	37	$	27
Interest cost		33		35		66		70
Expected return on plan assets		(50)		(48)		(101)		(95)
Amortization of:
Prior service cost		-		-		-		-
Actuarial loss		27		21		53		42
Net periodic pension cost	$	28	$	22	$	55	$	44

The components of our net periodic OPEB cost were as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Service cost	$	1	$	1	$	2	$	2
Interest cost		3		4		6		7
Amortization of:
Prior service credit		(4)		(4)		(8)		(8)
Actuarial loss		3		2		7		5
Net periodic OPEB cost	$	3	$	3	$	7	$	6

Cash Contributions

For the six months endedJune 30, 2013, we made $70 million ofcash contributions to the qualified pension plan. Any additional contributions made in the second half of the yearwill be based on cash generated from operations and financial market considerations.All contributions made to the qualified pension plan during the six months endedJune 30, 2013, were voluntary and were made with cash generated from operations. Our policy with respect to funding the qualified plans is to fund at least the minimum required by law and not more than the maximum amount deductible for tax purposes. At June 30, 2013, we do not have minimum cash funding requirements for 2013.

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Condensed Consolidated Statements of Financial Position (Unaudited) (USD $) In Millions, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Current assets [Abstract]
Cash and cash equivalents	$ 1,845	$ 1,063
Accounts receivable, net (Note 10)	1,468	1,331
Materials and supplies	654	660
Current deferred income taxes (Note 7)	242	263
Other current assets	334	297
Total current assets	4,543	3,614
Investments	1,272	1,259
Net properties (Note 11)	42,911	41,997
Other assets	300	283
Total assets	49,026	47,153
Current liabilities [Abstract]
Accounts payable and other current liabilities (Note 12)	3,092	2,923
Debt due within one year (Note 14)	733	196
Total current liabilities	3,825	3,119
Debt due after one year (Note 14)	9,076	8,801
Deferred income taxes (Note 7)	13,477	13,108
Other long-term liabilities	2,124	2,248
Commitments and contingencies (Note 16)
Total liabilities	28,502	27,276
Common shareholders' equity [Abstract]
Common shares, $2.50 par value, 800,000,000 authorized; 554,840,853 and 554,558,034 issued; 464,363,763 and 469,465,273 outstanding, respectively	1,387	1,386
Paid-in-surplus	4,162	4,113
Retained earnings	23,690	22,271
Treasury stock	(7,567)	(6,707)
Accumulated other comprehensive loss (Note 9)	(1,148)	(1,186)
Total common shareholders' equity	20,524	19,877
Total liabilities and common shareholders' equity	$ 49,026	$ 47,153

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Condensed Consolidated Statements of Income (Unaudited) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Operating revenues [Abstract]
Freight revenues	$ 5,153	$ 4,913	$ 10,137	$ 9,736
Other revenues	317	308	623	597
Total operating revenues	5,470	5,221	10,760	10,333
Operating expenses [Abstract]
Compensation and benefits	1,185	1,151	2,401	2,362
Fuel	863	882	1,763	1,808
Purchased services and materials	585	542	1,142	1,068
Depreciation	438	433	872	860
Equipment and other rents	302	299	615	595
Other	219	190	456	406
Total operating expenses	3,592	3,497	7,249	7,099
Operating income	1,878	1,724	3,511	3,234
Other income (Note 6)	23	21	63	37
Interest expense	(133)	(135)	(261)	(270)
Income before income taxes	1,768	1,610	3,313	3,001
Income taxes	(662)	(608)	(1,250)	(1,136)
Net income	$ 1,106	$ 1,002	$ 2,063	$ 1,865
Share and Per Share (Note 8) [Abstract]
Earnings per share - basic	$ 2.38	$ 2.11	$ 4.42	$ 3.92
Earnings per share - diluted	$ 2.37	$ 2.10	$ 4.40	$ 3.89
Weighted average number of shares - basic	465.3	473.8	466.6	475.8
Weighted average number of shares - diluted	467.6	477.2	469.1	479.3
Dividends declared per share	$ 0.69	$ 0.60	$ 1.38	$ 1.20

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Debt (Details 1) (USD $) In Millions, unless otherwise specified	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2013	Dec. 31, 2012
Credit Facilities [Abstract]
Revolving credit facility available credit	$ 1,800	$ 1,800
Revolving credit facility withdrawals	0	0
Compliance with covenant		At June 30, 2013, and December 31, 2012 (and at all times during the first and second quarters), we were in compliance with this covenant.	At June 30, 2013, and December 31, 2012 (and at all times during the first and second quarters), we were in compliance with this covenant.
Allowable debt per debt-to-net-worth coverage ratio (as defined in the facility)	41,000	41,000
Outstanding debt (as defined by facility)	10,400	10,400
Facility expiration date		May 25, 2015
Commercial paper outstanding	0	0
Commercial paper issued	0	0
Commercial paper repaid	$ 0	$ 0

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Retirement Plans (Tables)

6 Months Ended

Jun. 30, 2013

Retirement Plans [Abstract]

Net Periodic Pension And OPEB Cost [Table Text Block]

The components of our net periodic pension costwere as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Service cost	$	18	$	14	$	37	$	27
Interest cost		33		35		66		70
Expected return on plan assets		(50)		(48)		(101)		(95)
Amortization of:
Prior service cost		-		-		-		-
Actuarial loss		27		21		53		42
Net periodic pension cost	$	28	$	22	$	55	$	44

The components of our net periodic OPEB cost were as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Service cost	$	1	$	1	$	2	$	2
Interest cost		3		4		6		7
Amortization of:
Prior service credit		(4)		(4)		(8)		(8)
Actuarial loss		3		2		7		5
Net periodic OPEB cost	$	3	$	3	$	7	$	6

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Debt

6 Months Ended

Jun. 30, 2013

Debt [Abstract]

Debt [Text Block]

14. Debt

Credit Facilities – At June 30, 2013, we had$1.8 billionof credit available under our revolving credit facility (the facility), which is designated for general corporate purposes and supports the issuance of commercial paper. We did not draw on the facility at any time during the six months ended June 30, 2013. Commitment fees and interest rates payable under the facility are similar to fees and rates available to comparably rated, investment-grade borrowers. The facility allows for borrowings at floating rates based on London Interbank Offered Rates, plus a spread, depending upon our senior unsecured debt ratings. The facility matures in 2015 under a four year term and requires the Corporation to maintain a debt-to-net-worth coverage ratio as a condition to making a borrowing. At June 30, 2013, and December 31, 2012 (and at all times during the first and second quarters), we were in compliance with this covenant.

The definition of debt used for purposes of calculating the debt-to-net-worth coverage ratio includes, among other things, certain credit arrangements, capital leases, guarantees and unfunded and vested pension benefits under Title IV of ERISA. At June 30, 2013, the debt-to-net-worth coverage ratio allowed us to carry up to $41 billion of debt (as defined in the facility), and we had $10.4billion of debt (as defined in the facility) outstanding at that date. Under ourcurrent capital plans, we expect to continue to satisfy the debt-to-net-worth coverage ratio; however, many factors beyond our reasonable control could affect our ability to comply with this provision in the future. The facility does not include any other financial restrictions, credit rating triggers (other than rating-dependent pricing), or any other provision that could require us to post collateral. The facility also includes a $75 million cross-default provision and a change-of-control provision.

During the three andsix months ended June 30, 2013, we did not issue or repay anycommercial paper,and atJune 30, 2013, we had no commercial paper outstanding. Our revolving credit facility supports our outstanding commercial paper balances, and, unless we change the terms of our commercial paper program, our aggregate issuance of commercial paper will not exceed the amount of borrowings available under the facility.

Shelf Registration Statement and Significant New Borrowings – We filed a new automatic shelf registration statement that became effective on February 8, 2013. The Board of Directors authorized the issuance of up to $4 billion of debt securities, replacing the $1.4 billion of authority remaining under our shelf registration filed in February 2010. SEC rules require UPC, a large accelerated filer, to file a new shelf registration statement every three years. Under the current shelf registration, we may issue, from time to time, any combination of debt securities, preferred stock, common stock, or warrants for debt securities or preferred stock in one or more offerings. We have no immediate plans to issue equity securities; however, we will continue to explore opportunities to replace existing debt or access capital through issuances of debt securities under our shelf registration, and, therefore, we may issue additional debt securities at any time.

On March 15, 2013, we issued $325 million of 2.75% unsecured fixed-rate notes and $325 million of 4.25% unsecured fixed-rate notes under our shelf registration statement. The 2.75% notes will mature on April 15, 2023, and the 4.25% notes will matureon April 15, 2043. Proceeds from this offering are for general corporate purposes, including the repurchase of common stock pursuant to our share repurchase program. These debt securities include change-of-control provisions. At June 30, 2013, we had remaining authority from our Board of Directors to issue up to $3.35 billion of debt securities under the shelf registration.

At June 30, 2013, and December 31, 2012, we reclassified as long-term debt approximately $400 million and $100 million, respectively, of debt due within one year that we intend to refinance. This reclassification reflects our ability and intent to refinance any short-term borrowings and certain current maturities of long-term debt on a long-term basis.

Debt Redemption –On May 14, 2013, we redeemed all $40 million of our outstanding 5.65% Port of Corpus Christi Authority Revenue Refunding Bonds due December 1, 2022. The redemption resulted in an early extinguishment charge of $1 millionduring the three months ended June 30, 2013.

Receivables Securitization Facility – As of June 30, 2013, and December 31, 2012, we recorded $400 million and $100 million, respectively, as secured debt under our receivables securitization facility. See further discussion of our receivables securitization facility in Note 10.

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Income Taxes (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2013
Current Unrecognized Tax Benefits [Abstract]
Liability for unrecognized tax benefits	$ 114
Current asset for unrecognized tax benefits	$ 9

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Variable Interest Entities (Details) (USD $) In Billions, unless otherwise specified	Jun. 30, 2013
Variable Interest Entities Details [Abstract]
Future minimum lease payments	$ 3.4

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Stock-Based Compensation (Details 2) (USD $)	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Stock Options [Member]
Assumptions For Stock Awards [Abstract]
Risk-free interest rate	0.80%	0.80%
Dividend yield	2.10%	2.10%
Expected life (years)	5 years	5 years 4 months
Volatility	36.20%	36.80%
Weighted-average grant-date fair value of options granted	$ 34.98	$ 31.29
Performance Retention Awards [Member]
Assumptions For Stock Awards [Abstract]
Dividend per share per quarter	$ 0.69
Risk-free interest rate	0.40%
Continued employment requirement	Stock units awarded to selected employees under these grants are subject to continued employment for 37 months and the attainment of certain levels of ROIC.

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Commitments And Contingencies (Tables)

6 Months Ended

Jun. 30, 2013

Commitments And Contingencies Tables [Abstract]

Commitments And Contingencies Activity [Table Text Block]

Our personal injury liability activity was as follows:

Millions,
for the Six Months Ended June 30,	2013		2012
Beginning balance	$	334	$	368
Current year accruals		47		58
Changes in estimates for prior years		(22)		(36)
Payments		(44)		(50)
Ending balance at June 30	$	315	$	340
Current portion, ending balance at June 30	$	90	$	102

Our asbestos-related liability activity was as follows:

Millions,
for the Six Months Ended June 30,	2013		2012
Beginning balance	$	139	$	147
Accruals		-		-
Payments		(5)		(4)
Ending balance at June 30	$	134	$	143
Current portion, ending balance at June 30	$	8	$	9

Our environmental liability activity was as follows:

Millions,
for the Six Months Ended June 30,	2013		2012
Beginning balance	$	170	$	172
Accruals		19		24
Payments		(21)		(16)
Ending balance at June 30	$	168	$	180
Current portion, ending balance at June 30	$	49	$	47

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Share Repurchase Program (Tables)

6 Months Ended

Jun. 30, 2013

Share Repurchase Program [Abstract]

Share Repurchase Program [Table Text Block]

The table below represents shares repurchased under the new repurchase program.

	Number of Shares Purchased		Average Price Paid
	2013	2012		2013		2012
First quarter	2,881,400	3,917,369	$	136.58	$	110.64
Second quarter	3,061,470	3,770,528		151.42		110.02
Total	5,942,870	7,687,897		144.23		110.33
Remaining number of shares that may be repurchased under current authority						9,093,079

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Stock-Based Compensation

6 Months Ended

Jun. 30, 2013

Stock-Based Compensation [Abstract]

Stock-Based Compensation [Text Block]

4. Stock-Based Compensation

We have several stock-based compensation plans under which employees and non-employee directors receive stock options, nonvested retention shares, and nonvested stock units. We refer to the nonvested shares and stock units collectively as “retention awards”. We have elected to issue treasury shares to cover option exercises and stock unit vestings, while new shares are issued whenretention shares are granted.Information regarding stock-based compensation appears in the table below:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Stock-based compensation, before tax:
Stock options	$	6	$	4	$	10	$	9
Retention awards		20		20		41		40
Total stock-based compensation, before tax	$	26	$	24	$	51	$	49
Excess tax benefits from equity compensation plans	$	19	$	14	$	65	$	53

Stock Options – We estimate the fair value of our stock option awards using the Black-Scholes option pricing model. The table below shows the annual weighted-average assumptions used for valuation purposes:

Weighted-Average Assumptions		2013		2012
Risk-free interest rate		0.8%		0.8%
Dividend yield		2.1%		2.1%
Expected life (years)		5.0		5.3
Volatility		36.2%		36.8%
Weighted-average grant-date fair value of options granted	$	34.98	$	31.29

The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant; the dividend yield is calculated as the ratio of dividends paid per share of common stock to the stock price on the date of grant; the expected life is based on historical and expected exercise behavior; and volatility is based on the historical volatility of our stock price over the expected life of the option.

A summary of stock option activity during the six months ended June 30,2013, is presented below:

	Options (thous.)	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value (millions)
Outstanding at January 1, 2013	4,289	$	65.68	5.8 yrs.	$	258
Granted	572		132.00	N/A		N/A
Exercised	(853)		51.48	N/A		N/A
Forfeited or expired	(22)		106.00	N/A		N/A
Outstanding at June 30, 2013	3,986	$	78.01	6.1 yrs.	$	304
Vested or expected to vest at June 30, 2013	3,986	$	77.99	6.1 yrs.	$	304
Options exercisable at June 30, 2013	2,839	$	61.11	5.0 yrs.	$	265

Stock options are granted at the closing price on the date of grant, have ten-year contractual terms, and vest no later than three years from the date of grant. None of the stock options outstanding at June 30, 2013, are subject to performance or market-based vesting conditions.

At June 30, 2013, there was $26 million of unrecognized compensation expense related to nonvested stock options, which is expected to be recognized over a weighted-average period of 1.6years.Additional information regarding stock option exercises appears in the table below:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions	2013		2012		2013		2012
Intrinsic value of stock options exercised	$	54	$	41	$	82	$	103
Cash received from option exercises		17		24		31		45
Treasury shares repurchased for employee payroll taxes		(7)		(8)		(12)		(16)
Tax benefit realized from option exercises		21		15		32		39
Aggregate grant-date fair value of stock options vested		-		-		16		16

Retention Awards – The fair value of retention awards is based on the closing price of the stock on the grant date. Dividendsand dividend equivalents are paid to participants during the vesting periods.

Changes in our retention awards during the six months ended June 30,2013, were as follows:

	Shares (thous.)	Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2013	2,355	$	73.27
Granted	421		132.02
Vested	(850)		47.50
Forfeited	(48)		81.74
Nonvested at June 30, 2013	1,878	$	97.89

Retention awards are granted at no cost to the employee or non-employee director and vest over periods lasting up to four years. At June 30, 2013, there was $95million of total unrecognized compensation expense related to nonvested retention awards, which is expected to be recognized over a weighted-average period of 2.0years.

Performance Retention Awards – In February 2013, our Board of Directors approved performance stock unit grants. Other than different performance targets, the basic terms of these performance stock units are identical to those granted in February 2011, and February 2012, including using annual return on invested capital (ROIC) as the performance measure. We define ROIC asnet operating profit adjusted for interest expense (including interest on the present value of operating leases) and taxes on interest divided by average invested capital adjusted for the present value of operating leases.

Stock units awarded to selected employees under these grants are subject to continued employment for 37 months and the attainment of certain levels of ROIC. We expense the fair value of the units that are probable of being earned based on our forecasted ROIC over the 3-year performance period. We measure the fair value of these performance stock units based upon the closing price of the underlying common stock as of the date of grant, reduced by the present value of estimated future dividends. Dividend equivalents are paid to participants only after the units are earned.

The assumptions used to calculate the present value of estimated future dividends related to the February 2013,grant were as follows:

	2013
Dividend per share per quarter	$	0.69
Risk-free interest rate at date of grant		0.4%

Changes in our performance retention awards during the six months ended June 30, 2013, were as follows:

	Shares (thous.)	Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2013	1,075	$	83.80
Granted	304		125.14
Vested	(401)		58.33
Forfeited	(32)		96.85
Nonvested at June 30, 2013	946	$	107.44

At June 30, 2013, there was $55 million of total unrecognized compensation expense related to nonvested performance retention awards, which is expected to be recognized over a weighted-average period of 1.6 years.This expense is subject to achievement of the ROIC levels established for the performance stock unit grants.

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Other Income (Tables)

6 Months Ended

Jun. 30, 2013

Other Income [Abstract]

Other Income [Table Text Block]

Other income included the following:

		Three Months Ended				Six Months Ended
		June 30,				June 30,
Millions		2013		2012		2013 [a]		2012
Rental income		$	21	$	21	$	58	$	41
Net gain on non-operating asset dispositions			-		11		4		12
Early extinguishment of debt			(1)		(2)		(1)		(2)
Non-operating environmental costs and other			3		(9)		2		(14)
Total		$	23	$	21	$	63	$	37
[a]	Rental income includes $17 million related to a land lease contract settlement.

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Retirement Plans (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Pension [Member]
Net Periodic Pension And OPEB Cost [Line Items]
Service cost	$ 18	$ 14	$ 37	$ 27
Interest cost	33	35	66	70
Expected return on plan assets	(50)	(48)	(101)	(95)
Amortization of prior service credit	0	0	0	0
Amortization of actuarial loss	27	21	53	42
Net periodic pension/OPEB cost	28	22	55	44
Cash contributions to qualified pension plan			70
OPEB [Member]
Net Periodic Pension And OPEB Cost [Line Items]
Service cost	1	1	2	2
Interest cost	3	4	6	7
Amortization of prior service credit	(4)	(4)	(8)	(8)
Amortization of actuarial loss	3	2	7	5
Net periodic pension/OPEB cost	$ 3	$ 3	$ 7	$ 6

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Income Taxes

6 Months Ended

Jun. 30, 2013

Income Tax [Abstract]

Income Taxes [Text Block]

7. Income Taxes

Internal Revenue Service (IRS) examinations have been completed and settled for all years prior to 2005, although some interest calculations remain open for years prior to 2005. The IRS has completed its examinations and issued notices of deficiency for years 2005 through 2008. We disagree with many of their proposed adjustments, and we are at IRS Appeals for these years. The IRS is examining years 2009 and 2010, and we expect to receive their exam report in 2013.Additionally, several state tax authorities are examining our state income tax returns for years 2006 through 2010.

At June 30, 2013, our liability for unrecognized tax benefits was $114 million. Of that amount, $9 million is classified as a current asset in the Condensed Consolidated Statements of Financial Position.

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Operations And Segmentation

6 Months Ended

Jun. 30, 2013

Operations and Segmentation [Abstract]

Operations and Segmentation [Text Block]

3. Operations and Segmentation

The Railroad, along with its subsidiaries and rail affiliates, is our one reportable operating segment. Although we provide and analyze revenue by commodity group, we treat the financial results of the Railroad as one segment due to the integrated nature of our rail network. The following table provides freight revenue by commodity group:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
Millions		2013		2012		2013		2012
Agricultural	$	784	$	854	$	1,568	$	1,712
Automotive		534		475		1,021		905
Chemicals		890		795		1,763		1,563
Coal		975		869		1,911		1,864
Industrial Products		977		917		1,893		1,780
Intermodal		993		1,003		1,981		1,912
Total freight revenues		5,153		4,913		10,137		9,736
Other revenues		317		308		623		597
Total operating revenues	$	5,470	$	5,221	$	10,760	$	10,333

Although our revenues are principally derived from customers domiciled in the U.S., the ultimate points of origination or destination for some products transported by us are outside the U.S. Each of our commodity groups includes revenue from shipments to and from Mexico. Included in the above table are revenues from our Mexico business which amounted to $519million and $503million, respectively for the three months ended June 30, 2013, and June 30, 2012, and $1,024 million and $985 million, respectively for the six months ended June 30, 2013, and June 30, 2012.

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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Operating Activities [Abstract]
Net income	$ 2,063	$ 1,865
Adjustments to reconcile net income to cash provided by operating activities [Abstract]
Depreciation	872	860
Deferred income taxes and unrecognized tax benefits	365	274
Other operating activities, net	(83)	(25)
Changes in current assets and liabilities [Abstract]
Accounts receivable, net	(137)	(96)
Materials and supplies	6	(32)
Other current assets	(37)	(99)
Accounts payable and other current liabilities	169	29
Cash provided by operating activities	3,218	2,776
Investing Activities [Abstract]
Capital investments	(1,730)	(1,816)
Proceeds from asset sales	42	30
Other investing activities, net	(51)	(96)
Cash used in investing activities	(1,739)	(1,882)
Financing Activities [Abstract]
Debt issued (Note 14)	944	695
Common share repurchases (Note 17)	(833)	(833)
Dividends paid	(646)	(575)
Debt repaid	(139)	(193)
Other financing activities, net	(23)	(4)
Cash used in financing activities	(697)	(910)
Net change in cash and cash equivalents	782	(16)
Cash and cash equivalents at beginning of year	1,063	1,217
Cash and cash equivalents at end of period	1,845	1,201
Non-cash investing and financing activities [Abstract]
Cash dividends declared but not yet paid	316	280
Capital investments accrued but not yet paid	119	129
Common shares repurchased but not yet paid	24	15
Cash paid for: [Abstract]
Income taxes, net of refunds	(715)	(766)
Interest, net of amounts capitalized	$ (251)	$ (267)

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Debt (Details 2) (USD $) In Millions, unless otherwise specified				0 Months Ended
	Jun. 30, 2013	Feb. 08, 2013	Dec. 31, 2012	Mar. 15, 2013 2.75% Notes Due 2023 [Member]	Mar. 15, 2013 4.25% Notes Due 2043 [Member]
Shelf Registration Statement and Significant New Borrowings [Abstract]
Debt reclassified as long-term	$ 400		$ 100
Maturity date on new borrowing				Apr. 15, 2023	Apr. 15, 2043
Note amount				325	325
Issuance date				Mar. 15, 2013	Mar. 15, 2013
Interest rate on note				2.75%	4.25%
Board of Directors authorized debt issuance		4,000
Board of Directors remaining debt issuance	3,350		1,400
Receivables Securitization Facility Debt [Abstract]
Secured debt under receivables securitization facility	$ 400		$ 100

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Accounts Receivable (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Accounts Receivable Details [Abstract]
Allowance for doubtful accounts	$ 4		$ 4		$ 4
Allowance for doubtful accounts - receivables not expected to be collected in one year	27		27		33
Receivables Securitization Facility [Abstract]
Total capacity to transfer undivided interests to investors under the receivables securitization facility	600		600		600
Value of the outstanding undivided interest held by investors under the receivables securitization facility	400		400		100
Accounts receivable supporting the undivided interest held by investors	1,200		1,200		1,100
Cost of the receivables securitization facility - interest expense	$ 1	$ 1	$ 2	$ 2

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Properties (Tables)

6 Months Ended

Jun. 30, 2013

Properties [Abstract]

Properties [Table Text Block]

The following tables list the major categories of property and equipment, as well as the weighted average estimated useful life for each category (in years):

Millions, Except Estimated Useful Life			Accumulated		Net Book		Estimated
As of June 30, 2013	Cost		Depreciation		Value		Useful Life
Land	$	5,100	$	N/A	$	5,100	N/A
Road:
Rail and other track material		13,519		4,869		8,650	35
Ties		8,608		2,227		6,381	33
Ballast		4,491		1,127		3,364	34
Other roadway [a]		14,989		2,651		12,338	48
Total road		41,607		10,874		30,733	N/A
Equipment:
Locomotives		7,408		3,315		4,093	20
Freight cars		2,042		1,009		1,033	25
Work equipment and other		546		105		441	19
Total equipment		9,996		4,429		5,567	N/A
Technology and other		658		269		389	11
Construction in progress		1,122		-		1,122	N/A
Total	$	58,483	$	15,572	$	42,911	N/A

Millions, Except Estimated Useful Life				Accumulated		Net Book		Estimated
As of December 31, 2012		Cost		Depreciation		Value		Useful Life
Land		$	5,105	$	N/A	$	5,105	N/A
Road:
Rail and other track material			13,220		4,756		8,464	33
Ties			8,404		2,157		6,247	33
Ballast			4,399		1,085		3,314	34
Other roadway [a]			14,806		2,583		12,223	49
Total road			40,829		10,581		30,248	N/A
Equipment:
Locomotives			7,297		3,321		3,976	19
Freight cars			1,991		1,018		973	23
Work equipment and other			535		89		446	17
Total equipment			9,823		4,428		5,395	N/A
Technology and other			633		273		360	11
Construction in progress			889		-		889	N/A
Total		$	57,279	$	15,282	$	41,997	N/A
[a]	Other roadway includes grading, bridges and tunnels, signals, buildings, and other road assets.

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Accounts Receivable

6 Months Ended

Jun. 30, 2013

Accounts Receivable [Abstract]

Accounts Receivable [Text Block]

10. Accounts Receivable

Accounts receivable includes freight and other receivables reduced by an allowance for doubtful accounts. The allowanceis based upon historical losses, credit worthiness of customers, and current economic conditions. At bothJune 30, 2013, and December 31, 2012, our accounts receivable were reduced by$4 million. Receivables not expected to be collected in one year and the associated allowancesare classified as other assets in our Condensed Consolidated Statements of Financial Position. At June 30, 2013, and December 31, 2012, receivables classified as other assets were reduced by allowances of $27 million and $33 million, respectively.

Receivables Securitization Facility –The Railroad maintains a $600 million, 364-day receivables securitization facility under which it sells most of its eligible third-party receivables to Union Pacific Receivables, Inc. (UPRI), a wholly-owned, bankruptcy-remote subsidiarythat may subsequently transfer, without recourse an undivided interest in accounts receivable to investors. The investors have no recourse to the Railroad's other assets except for customary warranty and indemnity claims. Creditors of the Railroad do not have recourse to the assets of UPRI.

The amount outstanding under the facility was $400 million and$100 million at June 30, 2013, and December 31, 2012, respectively. The amount outstanding under the facility was supported by $1.2billion and $1.1 billion of accounts receivable as collateral at June 30, 2013, and December 31, 2012, respectively, which, as a retained interest, is included in accounts receivable, net in our Condensed Consolidated Statements of Financial Position.

The outstanding amounts the Railroad is allowed to maintain under the facility, with a maximum of $600 million, may fluctuate based on the availability of eligible receivables and is directly affected by business volumes and credit risks, including receivables payment quality measures such as default and dilution ratios.If default or dilution ratios increase one percent, amounts allowed to be outstanding under the facility would not materially change.

The costs of the receivables securitization facility include interest, which will vary based on prevailing commercial paper rates, program fees paid to banks, commercial paper issuing costs, and fees for unused commitment availability. The costs of the receivables securitization facility are included in interest expense and were$1million for the three months ended June 30, 2013, and 2012, and $2 million for the six months ended June 30, 2013, and 2012.

We are currently in the process of renewing the receivables securitization facilityfor an additional 364-day period at comparable terms and conditions.

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Other Income

6 Months Ended

Jun. 30, 2013

Other Income [Abstract]

Other Income [Text Block]

6. Other Income

Other income included the following:

		Three Months Ended				Six Months Ended
		June 30,				June 30,
Millions		2013		2012		2013 [a]		2012
Rental income		$	21	$	21	$	58	$	41
Net gain on non-operating asset dispositions			-		11		4		12
Early extinguishment of debt			(1)		(2)		(1)		(2)
Non-operating environmental costs and other			3		(9)		2		(14)
Total		$	23	$	21	$	63	$	37
[a]	Rental income includes $17 million related to a land lease contract settlement.

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Financial Instruments

6 Months Ended

Jun. 30, 2013

Financial Instruments[Abstract]

Financial Instruments [Text Block]

13.Financial Instruments

Strategy and Risk –We may use derivative financial instruments in limited instances for other than trading purposes to assist in managing our overall exposure to fluctuations in interest rates and fuel prices. We are not a party to leveraged derivatives and, by policy, do not use derivative financial instruments for speculative purposes. Derivative financial instruments qualifying for hedge accounting must maintain a specified level of effectiveness between the hedging instrument and the item being hedged, both at inception and throughout the hedged period. We formally document the nature and relationships between the hedging instruments and hedged items at inception, as well as our risk-management objectives, strategies for undertaking the various hedge transactions, and method of assessing hedge effectiveness. Changes in the fair market value of derivative financial instruments that do not qualify for hedge accounting are charged to earnings. We may use swaps, collars, futures, and/or forward contracts to mitigate the risk of adverse movements in interest rates and fuel prices; however, the use of these derivative financial instruments may limit future benefits from favorableinterest rate and fuel price movements.

Interest Rate Cash Flow Hedges – We report changes in the fair value of cash flow hedges in accumulated other comprehensive loss until the hedged item affects earnings. At bothJune 30,2013, and December 31, 2012, we had reductions of $1 millionrecorded as an accumulated other comprehensive loss that is being amortized on a straight-line basis through September 30, 2014, for a cash flow hedge that was settled in 2004. As of June 30,2013, and December 31, 2012, we had no interest rate cash flow hedges outstanding.

Fair Value of Financial Instruments – The fair value of our short- and long-term debt was estimated using a market value price model,which utilizes applicable U.S. Treasury rates along with current market quotes on comparable debt securities. All of the inputs used to determine the fair market value of the Corporation's long-term debt are Level 2 inputs and obtained from an independent source. At June 30,2013, the fair value of total debt was $11 billion, approximately $1.2billion more than the carrying value. AtDecember 31, 2012, the fair value of total debt was$11.1 billion, approximately $2.1billionmore than the carrying value. The fair value of the Corporation's debt is a measure of its current value under present market conditions. It does not impact the financial statements under current accounting rules. At June 30, 2013, and December 31, 2012, approximately$163 and $203million, respectively,of debt securities contained call provisions that allow us to retire the debt instruments prior to final maturity, with the payment of fixed call premiums, or in certain cases, at par.The fair value of our cash equivalents approximates their carrying value due to the short-term maturities of these instruments.

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Properties

6 Months Ended

Jun. 30, 2013

Properties [Abstract]

Properties [Text Block]

11. Properties

The following tables list the major categories of property and equipment, as well as the weighted average estimated useful life for each category (in years):

Millions, Except Estimated Useful Life			Accumulated		Net Book		Estimated
As of June 30, 2013	Cost		Depreciation		Value		Useful Life
Land	$	5,100	$	N/A	$	5,100	N/A
Road:
Rail and other track material		13,519		4,869		8,650	35
Ties		8,608		2,227		6,381	33
Ballast		4,491		1,127		3,364	34
Other roadway [a]		14,989		2,651		12,338	48
Total road		41,607		10,874		30,733	N/A
Equipment:
Locomotives		7,408		3,315		4,093	20
Freight cars		2,042		1,009		1,033	25
Work equipment and other		546		105		441	19
Total equipment		9,996		4,429		5,567	N/A
Technology and other		658		269		389	11
Construction in progress		1,122		-		1,122	N/A
Total	$	58,483	$	15,572	$	42,911	N/A

Millions, Except Estimated Useful Life				Accumulated		Net Book		Estimated
As of December 31, 2012		Cost		Depreciation		Value		Useful Life
Land		$	5,105	$	N/A	$	5,105	N/A
Road:
Rail and other track material			13,220		4,756		8,464	33
Ties			8,404		2,157		6,247	33
Ballast			4,399		1,085		3,314	34
Other roadway [a]			14,806		2,583		12,223	49
Total road			40,829		10,581		30,248	N/A
Equipment:
Locomotives			7,297		3,321		3,976	19
Freight cars			1,991		1,018		973	23
Work equipment and other			535		89		446	17
Total equipment			9,823		4,428		5,395	N/A
Technology and other			633		273		360	11
Construction in progress			889		-		889	N/A
Total		$	57,279	$	15,282	$	41,997	N/A
[a]	Other roadway includes grading, bridges and tunnels, signals, buildings, and other road assets.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2013	Jul. 12, 2013
Document and Entity Information [Abstract]
Document type	10-Q
Document period end date	Jun. 30, 2013
Amendment flag	false
Entity registrant name	UNION PACIFIC CORPORATION
Entity central index key	0000100885
Entity current reporting status	Yes
Entity voluntary filers	No
Current fiscal year end date	--12-31
Entity filer category	Large Accelerated Filer
Entity well known seasoned issuer	Yes
Entity common stock shares outstanding		463,844,338
Document fiscal year focus	2013
Document fiscal period focus	Q2

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Accounts Payable and Other Current Liabilities

6 Months Ended

Jun. 30, 2013

Accounts Payable and Other Current Liabilties [Abstract]

Accounts Payable and Other Current Liabilities [Text Block]

12. Accounts Payable and Other Current Liabilities

	June 30,		Dec. 31,
Millions	2013		2012
Accounts payable	$	908	$	825
Income and other taxes payable		413		368
Accrued wages and vacation		375		376
Dividends payable		316		318
Accrued casualty costs		224		213
Interest payable		183		172
Equipment rents payable		99		95
Other		574		556
Total accounts payable and other current liabilities	$	3,092	$	2,923