Canada’s two largest rail companies, Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC), are on the brink of a simultaneous strike for the first time.
The company has said it will begin locking out workers from early Thursday morning if no agreement is reached, while unions have said they are prepared to call for a strike on the same day.
The Teamsters union is demanding improved wages and benefits, including better fatigue management and crew scheduling.
According to the Canadian Railway Association, the two rail lines play a huge role in Canada’s economy, moving roughly $1 billion worth of goods per day.
Here we look at how strikes can affect businesses and people’s daily lives.
Move
For most people, the freight rail shutdown won’t have an immediate impact on how they travel, but it could affect more than 32,000 rail riders in Toronto, Montreal and Vancouver.
Transit officials have said that if dispatchers go on strike along with 3,200 other workers, some commuter routes that run on CPKC tracks will be suspended.
Workers at Canada’s two largest rail companies could go on strike as early as Thursday. CBC’s Clara Pasieka analyzes how that could affect the city’s public transit system and local businesses.
Commuter lines affected by the potential work stoppages include TransLink’s West Coast Express in the Vancouver region, Metrolinx’s Milton Line and Hamilton GO Station in the Greater Toronto Region, and Exo’s Candiac, Saint-Jérôme and Vaudreuil/Hudson lines in the Montreal region.
A Via Rail spokesman said services would also be disrupted on the line through Sudbury in northern Ontario.
grocery store
The threat of rail service being halted could also affect goods on grocery store shelves, especially if the conflict drags on.
Michael Graydon, CEO of the Canadian Food, Health and Consumer Products Association, an industry group, said some fresh produce is already not being transported by rail.
Graydon said frozen foods such as French fries may already be on hold. Meat and fruit such as bananas, which often arrive in the U.S. and then by rail to Canada, may also be affected, he said.
He said parts of Western Canada and Atlantic Canada Most likely to be affected.
Graydon also expressed concern that “consumer stockpiling,” as seen during the pandemic, could exacerbate potential shortages and put further strain on suppliers.
Small and medium-sized enterprises
If the strike continues for a long time, it will affect many businesses, especially small and medium-sized enterprises that have low stocks of goods and few options for obtaining more.
Small businesses “don’t have the flexibility to redirect cargo like larger companies do,” said Fraser Johnson, a professor of supply chain management at Western University’s Ivey Business School.
He said retailers like Walmart could put “contingency plans” in place to transport goods on alternative routes within the U.S. and “bring them back to our various stores in Canada.”
Dan Kelly, president of the Canadian Federation of Independent Business, said some small businesses are already feeling the impact.
“The impact is significant,” he said. “Even in retail, there are a lot of goods that are imported into Canada and then sold on their way to their final destination.”
Daniel Peretz, president of NexGen Polymers in London, Ontario, talks about the ongoing labor dispute between Canada’s two largest railroads and labor unions, and the impact that could have on the company and customers if service outages occur.
farmers
Canada’s agricultural sector, particularly in the Prairie provinces, relies heavily on rail for the transportation of agricultural products.
Stephen Vandervalk, a farmer near Fort Macleod, Alberta, and vice-president of the Wheat Growers Association, called the situation “completely out of control.”
“Harvest is right now. We’re at the combine. Bids are going down every day because the elevators don’t want the grain and they’re stopping grain deliveries,” Vandervalk told CBC.
Industry advocacy group Felt Reiser Canada warned that even the threat of a strike was causing damage.
“Farmers around the world depend on Canada’s fertilizer industry to maximize crop yields, and the fertilizer industry depends on rail to get its products to market,” Karen Proud, president of Fertilizer Canada, said in a statement.
supply chain
Fraser Johnson of Western University said in addition to the agriculture sector, the automotive sector and Canada’s ports will be the most affected by the shutdowns.
Prime Minister Johnson said rail is “an essential part of the supply chain that handles 50 per cent of Canada’s exports, for example, but is also incredibly important to many countries.” [domestic] industry.”
For example, automakers “still receive a lot of parts from suppliers by rail, and of course they still ship cars by rail from assembly plants,” he said.
Some companies rely solely on rail to transport their products, such as ChemTrade Logistics of Toronto, which says it supplies 40 percent of Western Canada’s drinking water and chlorine to much of the western United States.
The company’s products cannot be transported by truck or ship, and safety regulations limit the amount that can be stockpiled.
“This is a critical step forward for Canadian Chemistry Council CEO Bob Masterson,” said. Canadian Press If the water outage continues for more than a week, water supplies in some municipalities could be affected due to a shortage of chlorine.
Possible outcomes
Johnson said the shutdowns are unlikely to have an immediate impact on commodity prices.
CN staged an eight-day strike in November 2019 by more than 3,000 workers represented by the Canadian Teamsters.
The strike halted transportation and disrupted industry across the country, but its overall impact on the economy was “relatively small.” According to the red blood cell analysisRBC concluded that the strikes reduced quarterly growth by just 0.1 percentage points on an annualized basis.
Mr Johnson said a full shutdown of both lines this time would have a bigger impact, at least for those sectors directly affected.
“The main impact will be reduced sales, layoffs and possible wage losses for businesses in these areas,” he said.
