With contract talks between Canada’s major railroads and its union workers at an impasse, the prospects of a work stoppage starting Thursday looms closer to reality.
Logistics experts have warned of supply chain disruptions should Canada’s major rail carriers Canadian Pacific Kansas City and Canadian National shut down.
While contingency planning across all transportation modes is underway to avert service disruptions, business leaders and representatives from U.S. and Canada-based organizations seek a quick resolution to the crisis, with some calling for government intervention.
Below are some excerpts on what industry leaders are saying about the looming Canadian railroad workers strike.
Vancouver Fraser Port Authority
“The impact to the Port of Vancouver will be significant, with approximately two-thirds of all cargo volumes at the port moved by rail, including 90% of international exports,” the port told Supply Chain Dive in an email. “Trade through the Port of Vancouver plays a vital role supporting Canada and our economic prosperity, with approximately $1 of every $3 of Canada’s trade in goods outside of North America moving through the Port of Vancouver.
“It took many months to clear the backlog of congestion from the 13-day strike by B.C. longshore workers in 2023 at the Port of Vancouver, with delayed shipments and overburdened infrastructure struggling to restore normalcy.”
Retail Industry Leaders Association VP for Supply Chain Jessica Dankert
“As with any supply chain disruption, retailers are concerned with the expected congestion and delays, and potential ripple effects — including impacts on U.S.-based networks. Retailers have been focused on implementing contingency plans to mitigate the impact on consumers. We urge both parties to keep negotiating until a deal is reached that prevents a shutdown,” Dankert wrote in an email.
Canadian Chamber of Commerce President and CEO Perrin Beatty
“After the labour disruptions at our ports in British Columbia and the St-Lawrence Seaway, a strike at both of our Class 1 railways would be a terrible blow to Canada’s diminishing reputation as a reliable place to do business. We simply don’t have the capacity to replace the movement of goods by rail.”
“With trade accounting for more than two thirds of Canada’s GDP, our ability to get goods to and from market determines whether we will be competitive in the global economy, but our supply chains are only as strong as their weakest link. This is not the time to put further strain on an already fragile system; we need to ensure our supply chains are reliable and resilient.”
“We respect the right to collective bargaining and believe sincerely that the best deals are reached at the table. These repeated work stoppages are damaging the economy, jeopardizing predictability for businesses, and escalating uncertainty for Canadian families who are contending with an increased cost of living.”
Retail Council of Canada
“Rail shipments are vital to retail supply chains as our industry gears up for back-to-school and the holiday shopping season. A shutdown of Canada’s two main railway companies would be a one-two punch to retailers that could result in empty shelves across the country. RCC urges the parties to come to an immediate resolution and for the federal government to step in immediately if they do not.”
“RCC has joined a chorus of 80+ business associations in calling for immediate action by the Prime Minister and government to avert a disastrous shutdown of Canada’s rail network. Retailers need reliable rail to ensure Canadians have access to all the goods they need for their daily lives.”
National Grain and Feed Association
“Operational railroads are essential on both sides of the border for the integrated North American supply chain. While we believe a negotiated solution is always the preferred outcome, the government should be prepared to move quickly if negotiations fail.”
National Institute of Supply Chain Leaders BC
“Should a lockout occur, it will likely precipitate substantial disruptions throughout the province. Expected impacts include delays in transportation and a considerable backlog affecting the movement of goods both into and out of the region, as well as within the province. We strongly advise businesses and consumers to proactively prepare for these potential disruptions. Where feasible, consider alternative transportation options to mitigate the effects of any delays,” the institute wrote in an email.
National Retail Federation
”NRF encourages the negotiating parties to remain at the table until a new deal is reached. We are already starting to see embargoes for certain commodities, and a shutdown of cross-border rail service would negatively impact retailers during the height of peak shipping season. We continue to see supply chain disruptions caused by a variety of issues. It is critical we avoid self-inflicted disruptions that result in a shutdown of services and hinder the transport of goods to market in a timely manner. The overall impact won’t just be a shutdown, but also the time it takes to recover from a shutdown,” Jonathan Gold, VP of supply chain and customs policy, wrote in an email.
Union Pacific Railroad
“For Union Pacific, a rail stoppage in Canada would mean thousands of cars per day not moving across the border. Everything from grain and fertilizer during the critical summer season, and lumber for building homes could be impacted. A prolonged shutdown could have even more significant implications. As Union Pacific adheres to embargoes related to the potential lockout, we are working to minimize impact to our customers and the U.S. supply chain. We remain in close communication with the Canadian railroads,” the railroad wrote in an email.