Standard&Poor's Ratings Services' ratings on Norfolk, Va.-based Norfolk Southern Corp. reflect its solid competitive position as one of the two large eastern freight railroads, its "strong" liquidity position, and the favorable industry risk characteristics of the U.S. freight railroad industry. Price competition from other railroads and trucking companies and the capital intensity of the industry partly offset these strengths. As a result of modest pricing increases and improving operating efficiency, we expect Norfolk Southern to maintain satisfactory profitability and generate funds from operations (FFO) to total debt in the mid- to high-30% area in 2012. We characterize the company's business risk as "strong," its financial risk as "intermediate," and its liquidity as strong. Norfolk Southern enjoys healthy competitive
