Supply Chain Dive
July 24, 2024
Larry Avila
Being prepared for potential service disruptions is part of Scott Shannon’s job.
As a VP with C.H. Robinson Worldwide’s North American Transportation Division, he oversees the brokerage’s operations in Canada where it manages more than 650,000 cross border shipments annually.
So when Shannon learned in May that Canadian railroad workers authorized a strike, he recognized the crippling impact it could have on freight movement, and immediately began contingency planning. The plan wasn’t needed at the time — the Canadian government halted it to assess the public impact of a strike — but Shannon is keeping contingencies ready in case disruption eventually comes.
While no strike is imminent, the prospects of a work stoppage by Canada’s nearly 10,000 union railroad workers has plagued logistics managers, like Shannon, for months. On July 12, the Canadian government announced it would release a decision by Aug. 9 on whether a work stoppage by the Teamsters Canada Rail Conference would impact residents’ health and safety. If it’s determined there is no safety risk to citizens, represented workers are positioned to legally strike 72 hours after the government announces its decision.
The union, Teamsters Canada Rail Conference, has said it is prepared to strike unless it gets a new labor deal to replace its contract that expired Dec. 31, 2023. Here’s what such a strike would mean for supply chains, according to several logistics experts.
Paul Brashier, VP of Global Supply Chain at ITS Logistics, said the industry continued preparing for shipping delays even after the initial strike was postponed.
Brashier said in ITS Logistics May Port Rail Ramp Index that railroad strikes in Canada would negatively impact ramps in the U.S. Midwest and Toronto, as a majority of those containers enter North America through Canadian ports.
“The best operational plan to avoid these challenges is to terminate imports at the port of entry and use dray off, transload, and one-way trucking to get freight into DC networks,” he said.
