Ottawa, Ontario – This past Thursday, two of Canada’s largest railways, the Canadian Pacific Kansas City and Canadian National railroads, initiated strike action, potentially causing an impact on shipments of automobiles, auto parts and more.
By Thursday evening, federal Lambour Minister Steven MacKinnon directed the Canadian Industrial Relations Board to order the railways to resume service and enter binding arbitration to reach collective agreements. Canadian National (CN) has declared its lockout over and its 6,500 Teamsters unionized workers have returned to work on Friday, though the Canadian Pacific Kansas City stoppage is ongoing.
Collision Repair spoke to Val Kucherenko, Director for Railway Education at Michigan State University, who said, in his opinion, the automotive industry impact seen from the Canadian railway strike would be ‘minimal,’ should the strike only last a few days.
“Everyone was sort of aware and getting ready for the strike to happen,” he said, referring to the fact that collective bargaining talks had been ongoing for quite some time. “There was no certainty, but when you have something coming up and it’s not good for the supply, it can start working in plans B and C.
“From an automotive dealership perspective, there shouldn’t be any immediate impacts. I’m sure they were aware of it coming,” he said.
Kucherenko says that a combination of both large orders of the same part destined for assembly plants and general stock for dealerships or service centres are typically shipped via freight. The automotive industry heavily relies on interconnectivity between different plants, producers and manufacturers of different parts. On average, vehicles consist of 30,000 parts and they will all come from different parts of not only the country but the world.
“If the manufacturer is based out of the U.S., it doesn’t mean that all of the parts are sourced from the U.S., or even Canada or Mexico. Some parts come from different parts of the world. So the impact doesn’t come from local suppliers, it can be an effect of impacts that will be felt across the entire network,” Kucherenko said.
As of Friday, Aug. 23 at noon E.T., the Teamsters union has issued a strike notice at CN for 10 a.m. ET Monday, Aug. 26.
