The combined actions of U.S. and Canadian dockworkers are expected to delay goods movement and increase costs for both businesses and consumers
Ports across North America are facing widespread disruptions as dockworkers initiate strikes on both the U.S. East Coast and at key Canadian facilities and the aftermarket is raising concerns over the events.
The International Longshoremen’s Association (ILA) has shut down all ports from Maine to Texas, while workers at the Port of Montreal have begun a 72-hour strike. These coordinated actions threaten to severely impact international trade and exacerbate existing supply chain challenges.
The ILA, representing U.S. dockworkers, rejected the United States Maritime Alliance’s (USMX) final proposal, leading to their first coastwide strike in nearly 50 years. Picket lines were set up at waterfront facilities, affecting all Atlantic and Gulf Coast ports.
The Auto Care Association, which represents the automotive aftermarket in the United States, released a statement warning of the disruption labour unrest will have on the industry. It further called on the U.S. government to put an end to the strikes.
The group noted that a significant portion of the auto care industry’s imports and exports ports are handled in the East and Gulf ports. Auto Care warned of billions of dollars in losses and delays in goods movement, impacting repair shops’ and distributors’ abilities to meet demand.
It also noted that estimates show that a day of disruption takes five days to recover. The announcement stated that almost a quarter of aftermarket parts come through the East and Gulf ports.
“Each day that this strike continues, not only does our industry lose out on hundreds of millions of dollars in business, but the nearly 300 million Americans who drive are more at risk on the road as access to service and repair of their vehicles diminishes,” Auto Care Association president Bill Hanvey said. “We are calling on the Biden administration to take all possible and appropriate steps to facilitate a resolution between the two parties so that Americans across the country can get back to work safely.”
The union’s primary demands include significant wage increases and protections against automation, which they argue is threatening jobs and driving unfair practices by foreign-owned shipping companies.
They accused companies of “gouging customers,” noting that the cost of shipping a full container has skyrocketed from $6,000 to $30,000 in recent weeks.
On the other hand, USMX said it had increased its offer to the ILA, proposing nearly 50 per cent wage hikes and better retirement benefits. They called for an extension of the current contract to allow for continued negotiations and avoid further disruption. Despite this, the union remains steadfast, saying the offer falls short.
In Canada, the Port of Montreal is grappling with its own labor unrest. Workers at the Viau and Maisonneuve terminals, which account for 41 per cent of container traffic, initiated a three-day strike on Monday, halting operations at two of the port’s busiest terminals. The Syndicat des débardeurs du port de Montréal (SCFP) union said it was frustrated over failed mediation efforts, saying their efforts to avoid the strike “have not borne fruit.”
The Montreal Port Authority kickied in a business continuity plan, hoping to minimize the broader impact of the strike. However, the port’s CEO, Julie Gascon, warned of the significant disruption to the flow of goods.
“Nearly $6 billion worth of goods are expected to arrive at the port in the coming weeks. The uncertainty surrounding our activities will have a domino effect on importers, exporters and the general public,” she said.
Small businesses are particularly concerned about the impact of these strikes. Jasmin Guenette, vice president of the Canadian Federation of Independent Business (CFIB), highlighted the risk to Canada’s supply chain infrastructure, noting that this is the third strike at the Port of Montreal since 2020. He wants to see federal intervention to make ports an essential service.
“It’s simply irresponsible for the unions to take strike action yet again,” Guenette said.
These strikes come as the holiday season approaches, adding to concerns about supply chain disruptions. Everstream Analytics, which tracks supply chain risks, noted that the current situation could lead to widespread congestion at ports, especially as diverted cargo overwhelms the West Coast.
Image credit: Depositphotos.com
