Two major Canadian railroads are on the brink of a strike. Teamsters working for Canadian Pacific Kansas City (CPKC) and Canadian National Railway (CN) are set to strike on August 22nd unless a new labor contract is agreed upon. The union is demanding higher wages, better benefits, improved fatigue management, and better scheduling for crews.
A strike would have severe repercussions not just in Canada, but also in the United States and beyond. CPKC and CN are key players in the U.S. rail network, connecting major cities like Chicago, New Orleans, Minneapolis, and Memphis. CPKC also handles a significant portion of rail freight between Mexico’s east and west coasts.
American businesses could face substantial disruptions, as Canada ships 75% of its rail freight south of the border. Sectors likely to be hit hardest include automobile manufacturing, agriculture, and industries reliant on petroleum products.
Teamsters at CN have already started imposing embargoes on specific goods and destinations. Banned cargos include hazardous materials, security-sensitive items, and refrigerated goods. In response, U.S. rail companies have enacted their own precautionary measures. For instance, Norfolk Southern has imposed an embargo on hazmat and security-sensitive products traveling to Canada.
A strike seems imminent, as the Teamsters Union of Canada issued a 72-hour strike warning on August 19th. This means members will begin their strike at 12:01 a.m. on August 22nd. Despite ongoing negotiations, progress towards a resolution has been minimal. All American businesses and consumers can do now is hope for a swift resolution to avoid severe impacts on the supply chain.