The Canadian rail landscape is currently bracing for a significant disruption. Over 9,000 workers from Canadian National (CN) and Canadian Pacific Kansas City (CPKC) have voted in favor of a strike. The Canadian Industrial Relations Board has jurisdiction over this dispute, and according to this bulletin from the Teamsters issued May 22nd, submissions were made on May 21st, with rebuttals due by May 31st, pushing any action into at least June.
Central Issues and Impacts
The main sticking point in the negotiations is the rest periods between shifts, with the unions arguing for better conditions to ensure safety and the companies pushing for changes they believe will protect the supply chain and ensure economic stability. The potential strike looms as a disruption that could halt the shipment of goods worth approximately $1 billion per day.
Potential Economic and Industry Impact
A strike would likely have a more significant impact than past disruptions, such as the Port of Vancouver strike, due to the rail system’s critical role in transporting diverse goods across the vast nation. These carriers also service the ports of Vancouver and Prince Rupert, key intermodal gateways for Asian imports to the midwestern United States, in addition to Canadian farmers and shipping interests who rely heavily on these two transnational railroads.
Looking Ahead
In the bulletin we referenced earlier, the Teamsters representing the rail workers remain committed to a Collective Agreement, even in the face of what they claim is the railroads’ interest in forcing them into arbitration instead.
For businesses, particularly those in trade-sensitive sectors, the importance of preparing for such disruptions by diversifying logistics options and maintaining flexible supply chain strategies cannot be overstated. We are speaking with our customers about alternative ports of lading and unlading for their goods in the Pacific Northwest.
Shipments already in transit eastbound on the transpacific which cannot be diverted should weigh the risk of waiting to see what happens versus taking proactive action like terminating shipments at the port and securing transloading and overland truck capacity before it is no longer available.
If Canada plays a large part in your supply chain, Alba will work with you and ask important questions about customers, delivery commitments, potential penalties for incomplete or non-deliveries and make suggestions on how to avoid those delays and costs.
