SIU logistics expert: Potential Canadian rail, dock strikes could have broad impact in U.S.

August 09, 2024

by Christi Mathis

CARBONDALE, Ill. - If workers strike at both of Canada's rail systems and the Port of Vancouver, the ramifications on the supply chain would extend throughout North America, says Gregory D. DeYong, a Southern Illinois University Carbondale associate professor of operations management.

"A Canadian rail strike wouldn't occur in isolation," he said. "The U.S. and Canadian systems are quite interconnected. In particular, the Canadian Pacific Kansas City Limited system operates extensively in Canada, the U.S. and Mexico. Although U.S. rail and truck carriers, as well as Canadian truck carriers, can likely pick up most of the freight that would be affected by a Canadian rail strike, this will lead to much tighter shipping capacity, potential delays and higher shipping costs. The Canadian railways are an important link in the supply chains for imported goods, agricultural products, automobiles and petroleum products, to name a few."

Strike actions by railway workers with the Teamsters Canada Rail Conference at both the Canadian National Railway Company and the Canadian Pacific Kansas City Limited were paused in May as the Canada Industrial Relations Board considered whether railways provide an essential service and a strike would be detrimental to public health and safety.

DeYong said the contract talks between the Canadian Teamsters union and the two Canadian railroads have resumed because the Canadian government is about to remove the "no strike" condition. That hurdle may be cleared as soon as today, Aug. 9, and a strike could start as soon as Monday, Aug. 12.

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Gregory D. DeYong, associate professor of operations management at SIU Carbondale, can be reached at [email protected].

"For a country as large and dependent on rail service as Canada, a strike could be devastating," DeYong said. "This could be even worse if the union breaks with tradition and stops work at both Canadian railways. Although this hasn't been the case in the past, we in the U.S. still remember the United Auto Workers broke a similar tradition last year when they simultaneously imposed work stoppages at all of the Big Three automakers."

It's estimated that about $1.04 billion in goods are transported by rail daily in Canada and about $200 billion in goods are transported to markets around North America and beyond.

Meanwhile, more than 700 dock foremen at the Port of Vancouver represented by the International Longshore and Warehouse Union Local 514 are conducting a strike vote, and the Freight Management Association and the Greater Vancouver Board of Trade warn a dock strike could shut down critical terminals on Canada's west coast, disrupting trade.

If dockworkers also decide to strike, the effects would be compounded, said DeYong.

DeYong has personal experience as well as professional knowledge in supply chain management. Before becoming a faculty member, he worked as an import/export manager, where he was responsible for about $100 million in products annually. DeYong is currently working to establish a Center for Supply Chain Management and Logistics within SIU's College of Business and Analytics.

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