OTTAWA (dpa-AFX) - Canada's two main freight rail companies have shut down their operations after months of contract negotiations with trade unions failed to reach an agreement.
Rail freight traffic in Canada came to a standstill early Thursday as Canadian National (CN) and Canadian Pacific Kansas City Southern (CPKC) locked out their nearly 10,000-strong workforce.
According to reports, the shutdown could disrupt supply chains in the United States and Canada, resulting in serious economic consequences, costing millions of dollars.
Thousands of cargo containers transit through the U.S.-Canada rail route daily, carrying raw materials for production in automobile, agriculture, home building and energy sectors.
'CPKC is acting to protect Canada's supply chains, and all stakeholders, from further uncertainty and the more widespread disruption that would be created should this dispute drag out further resulting in a potential work stoppage occurring during the fall peak shipping period,' the company said in a statement Thursday.
The union and the managements have been engaged in negotiations for months to reach a contract deal on workers' demand for better wages, benefits, and working conditions.
Teamsters Canada Rail Conference, which represent drivers who operate the trains, say the main hurdle to conclude a deal is the companies' demands, not union's proposals.
This is the first time that both the major railroad companies in Canada have stopped operations simultaneously due to a labor dispute, asking thousands of workers not to report for duty.
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