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Resumption of CP rail service critical for manufacturing, primary industries: CME

Published by Derek Lothian on May 27, 2012

The following statement was issued today by Jayson Myers, president and CEO of Canadian Manufacturers & Exporters (CME):

On behalf of CME, Canada's largest trade and industry association, I am calling on the federal government to immediately intervene in the labour conflict at Canadian Pacific Railway to end the dispute and facilitate the resumption of normal rail service.

Over the past week, we've heard directly from members, large and small, from all sectors of the economy, who have indicated the labour disruption at CP is having a significant impact on production, employment levels and – of course – transportation. Some estimates have ranged between $100,000 in added cost per month, should the strike continue, to $100,000 per day, depending on the size of company and the type of materials being moved. And that is if they can find alternatives. In most cases, the logistics network does not have the additional infrastructure capacity to support the delivery of new, time-sensitive freight.

Rail shipping is a critical link in the global supply chains of Canadian businesses. Manufacturing, agriculture and natural resource operations all rely heavily on rail for both imports and exports traded between North America and the rest of the world. Redirecting shipments to other modes of transport is not as simple as flipping a switch, and can be at least 2-3 times more expensive, particularly for raw materials and larger goods. Moreover, it does not help with essential shipments currently stuck in-transit within CP's rail system, which can jeopardize millions of dollars in cargo.

While we fully respect the rights of Canadian workers, we must also take into consideration the damaging effect a prolonged strike has on the economy and on other jobs across the country. Each day that passes without a resolution costs Canadian manufacturers and primary industries an estimated $30-$50 million in lost productivity and new expenses. Some of this cost will be recoverable in ramping up production after the end of the strike; however – in many cases – companies cannot afford to pass new costs onto their consumers if they are to remain competitive.

Manufacturers and exporters coast to coast, as well as their employees, are already battling challenging market conditions around the world. It is critical they have a reliable, functional transportation network to help them prosper both at home and on the global stage. CP is a core element to this network, and it is why CME continues to advocate for an end to the labour dispute as quickly as possible.

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