Supply chain concerns grow amid possible railroad strike

Cindy Bae Image
Tuesday, September 13, 2022
Supply chain concerns grow amid possible railroad strike
As the deadline for the two largest U.S. freight rail unions and rail carriers to reach an agreement near, concerns amid an already strapped supply chain grow.

As the deadline for the two largest U.S. freight rail unions and rail carriers to reach an agreement near, concerns amid an already strapped supply chain grow.

"A rail worker strike would be catastrophic for America's transportation system and our already-stressed supply chain," Sen. Richard Burr (R-NC) said in a statement. "The Presidential Emergency Board recommendations are a fair and appropriate solution to a years-long negotiation process, but labor unions are continuing to hold the entire nation's rail system hostage as they demand more. The Biden Administration should reject labor unions' bullying tactics. This resolution would provide certainty for Americans who have a right to travel and work freely across state lines."

Burr's resolution is part of a bi-partisan effort supporting the PEB's recommendation as Amtrak passengers and business owners in North Carolina worry about the potential railroad strike.

Amtrak announced on Monday they will preemptively cancel some long distance trips, mostly in the Amtrak-owned Northeast Corridor (Boston - New York - Washington).

"It would definitely make me worried and concerned because it's my form of transportation right now, so yes, I would be hurt to not be able to ride the train, Amtrak," Quiatasia Jenkins said, who travels back and forth from Durham, to Charlotte several times a month.

Although North Carolina isn't directly impacted for now, Amtrak said these "initial adjustments" could be followed by impacts to all long distance and most state-supported routes.

"Such an interruption could significantly impact intercity passenger rail service, as Amtrak operates almost all of our 21,000 route miles outside the Northeast Corridor (NEC) on track owned, maintained, and dispatched by freight railroads," Amtrak said in a statement. "These adjustments are necessary to ensure trains can reach their terminals before freight railroad service interruption if a resolution in negotiations is not reached."

The deadline is on Friday, which the NCDOT is also closely monitoring.

"Freight and passenger rail networks contribute greatly to the economy and the supply chain and represent a critical transportation connection for North Carolinians," NCDOT said. "While the ongoing freight rail - rail labor contract negotiations do not involve the N.C. Department of Transportation or its workforce ... we hope all parties can come to a mutual agreement soon."

Business owners, such as Matthias Payton, are also bracing for potential impacts. Payton launched his brand, Jasper & Gold, two years ago. Payton, who makes teas, said how last year there was a delay in getting hibiscus, unrelated to the railroad strike.

"If any of the companies that I'm sourcing from changes, or if they don't have it in stock, and now I have to order from a different company, it normally takes a lot longer for me to find herbs and these spices, or whatever I'm using," Payton said. "Timing is crucial."

NC State supply chain expert Tim Kraft explained how critical rail service is to the U.S.

"Rail represents 30% of our freight capacity here in the U.S.," Kraft said. "The fact that there would just be huge ripple effects because all of a sudden ports are backing up, the rails aren't there to take away the goods, trucks are waiting for delivery and now the rail isn't delivering it."

Kraft said how the agriculture industry could be hit the hardest.

"There's a real fear in terms of agriculture, the impact of long strike, or even just a short term strike could have on the agricultural industry just because harvest seasons coming up," Kraft said. "These items are perishable. So it's really critical to get these items out into market."