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CPKC moves to restart rail operations following CIRB order

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Canadian Pacific Kansas City (CPKC) announced it will restart railway operations in Canada by 00:01 ET on Monday, Aug. 26, following a Canada Industrial Relations Board (CIRB) order. This comes after CPKC initiated a lockout on Thursday, Aug. 22. The company has requested Teamsters Canada Rail Conference (TCRC) employees to return for the Sunday day shift to expedite economic recovery and minimize supply chain disruptions.

CPKC is implementing a restart plan for safe resumption of rail service across Canada and working with customers to normalize operations. The CIRB will hold a meeting on Thursday, Aug. 29, to discuss final binding interest arbitration. Existing collective agreements remain in force. CPKC expects it will take several weeks for the railway network to fully recover and additional time for supply chains to stabilize.

Canadian Pacific Kansas City (CPKC) ha annunciato che riavvierà le operazioni ferroviarie in Canada a partire dalle 00:01 ET di lunedì 26 agosto, in seguito a un'ordinanza del Canada Industrial Relations Board (CIRB). Questo annuncio arriva dopo che CPKC ha avviato un blocco giovedì 22 agosto. L'azienda ha richiesto ai dipendenti del Teamsters Canada Rail Conference (TCRC) di tornare al turno diurno della domenica per accelerare il recupero economico e ridurre al minimo le interruzioni della catena di approvvigionamento.

CPKC sta attuando un piano di riavvio per la ripresa sicura del servizio ferroviario in tutto il Canada e sta lavorando con i clienti per normalizzare le operazioni. Il CIRB terrà una riunione giovedì 29 agosto per discutere dell'arbitrato vincolante finale. I contratti collettivi esistenti rimangono in vigore. CPKC prevede che ci vorranno diverse settimane affinché la rete ferroviaria si riprenda completamente e ulteriore tempo perché le catene di approvvigionamento si stabilizzino.

Canadian Pacific Kansas City (CPKC) anunció que reiniciará las operaciones ferroviarias en Canadá a partir de las 00:01 ET del lunes 26 de agosto, tras una orden de la Junta de Relaciones Industriales de Canadá (CIRB). Esto ocurre después de que CPKC iniciara un bloqueo el jueves 22 de agosto. La compañía ha solicitado a los empleados del Teamsters Canada Rail Conference (TCRC) que regresen para el turno diurno del domingo para acelerar la recuperación económica y minimizar las interrupciones en la cadena de suministro.

CPKC está implementando un plan de reinicio para la reanudación segura del servicio ferroviario en todo Canadá y está colaborando con los clientes para normalizar las operaciones. El CIRB realizará una reunión el jueves 29 de agosto para discutir la arbitraje de interés vinculante final. Los acuerdos colectivos existentes siguen en vigor. CPKC espera que se necesiten varias semanas para que la red ferroviaria se recupera completamente y tiempo adicional para que las cadenas de suministro se estabilicen.

캐나다 태평양 캔자시 시티(CPKC)는 캐나다에서 철도 운영을 재개할 것이라고 발표했습니다. 8월 26일 월요일 오전 00:01 ET부터 시행됩니다. 이는 캐나다 산업 관계 위원회(CIRB)의 명령에 따른 것입니다. CPKC는 8월 22일 목요일에 잠금을 시작했습니다. 회사는 경제 회복을 가속화하고 공급망 중단을 최소화하기 위해 팀스터스 캐나다 철도 회의(TCRC) 직원들에게 일요일 주간 근무로 복귀할 것을 요청했습니다.

CPKC는 캐나다 전역에서 철도 서비스의 안전한 재개를 위한 재시작 계획을 시행하고 있으며, 고객과 협력하여 운영을 정상화하고 있습니다. CIRB는 8월 29일 목요일에 최종 구속력 있는 이해관계 중재를 논의하기 위해 회의를 개최할 예정입니다. 기존의 단체 협약은 여전히 유효합니다. CPKC는 철도 네트워크가 완전히 회복되기까지 몇 주가 걸릴 것으로 예상합니다와 공급망이 안정화되는 데 추가 시간이 소요될 것입니다.

Canadian Pacific Kansas City (CPKC) a annoncé qu'il reprendra les opérations ferroviaires au Canada à partir de 00h01 ET le lundi 26 août, suite à un ordre de la Commission des relations industrielles du Canada (CIRB). Cela fait suite à la mise en lock-out de CPKC jeudi 22 août. L'entreprise a demandé aux employés de la Conférence ferroviaire des Teamsters Canada (TCRC) de revenir pour le poste de jour du dimanche afin d'accélérer la reprise économique et de minimiser les perturbations de la chaîne d'approvisionnement.

CPKC met en œuvre un plan de redémarrage pour la reprise en toute sécurité du service ferroviaire à travers le Canada et travaille avec les clients pour normaliser les opérations. La CIRB tiendra une réunion le jeudi 29 août pour discuter de l'arbitrage d'intérêts contraignant final. Les accords collectifs existants restent en vigueur. CPKC prévoit qu'il faudra plusieurs semaines pour que le réseau ferroviaire se rétablisse complètement et du temps supplémentaire pour que les chaînes d'approvisionnement se stabilisent.

Canadian Pacific Kansas City (CPKC) hat angekündigt, dass es die Eisenbahnbetriebe in Kanada wieder aufnehmen wird, beginnend am Montag, den 26. August um 00:01 ET, gemäß einer Anordnung des Canada Industrial Relations Board (CIRB). Dies geschieht, nachdem CPKC am Donnerstag, den 22. August, einen Lockout eingeleitet hatte. Das Unternehmen hat die Mitarbeiter der Teamsters Canada Rail Conference (TCRC) aufgefordert, für die Tagschicht am Sonntag zurückzukehren, um die wirtschaftliche Erholung zu beschleunigen und Unterbrechungen in der Lieferkette zu minimieren.

CPKC implementiert einen Restart-Plan für die sichere Wiederaufnahme des Eisenbahnverkehrs in ganz Kanada und arbeitet mit den Kunden zusammen, um die Betriebsabläufe zu normalisieren. Der CIRB wird am Donnerstag, den 29. August, ein Treffen abhalten, um die endgültige verbindliche Interessenverhandlung zu erörtern. Bestehende Tarifverträge bleiben in Kraft. CPKC erwartet, dass es mehrere Wochen dauern wird, bis sich das Eisenbahnnetz vollständig erholt und zusätzliche Zeit benötigt wird, um die Lieferketten zu stabilisieren.

Positive
  • CPKC is restarting railway operations, potentially improving revenue streams
  • The CIRB order ends months of uncertainty, potentially stabilizing CPKC's business operations
  • Existing collective agreements remain in force, providing operational continuity
Negative
  • The work stoppage may have caused significant disruptions to CPKC's operations and revenue
  • Several weeks are expected for full network recovery, potentially impacting short-term financial performance
  • Additional time needed for supply chain stabilization may affect customer relationships and future contracts

Insights

The CIRB order to restart CPKC's railway operations is a significant development for the company and the Canadian economy. The resumption of services after the brief lockout should help mitigate potential financial losses and restore investor confidence. However, the several weeks needed for network recovery and supply chain stabilization could impact Q3 2024 financial results. Investors should monitor CPKC's ability to quickly ramp up operations and any potential compensation claims from affected customers. The upcoming binding arbitration might lead to increased labor costs, potentially affecting profit margins in the medium term. Overall, while the resolution is positive, the lingering effects of the disruption warrant careful observation of CPKC's performance in the coming months.

The CIRB's intervention marks a critical juncture in CPKC's labor relations. The order for binding arbitration suggests a failure in collective bargaining, which could strain future labor-management relations. This situation highlights the vulnerability of rail operations to labor disputes and the government's willingness to intervene in critical infrastructure sectors. The upcoming arbitration process will be crucial, potentially setting precedents for the industry. Investors should be aware that while this resolves the immediate crisis, it may not address underlying issues, possibly leading to future labor unrest. The company's approach to rebuilding trust with its workforce and improving labor relations will be key factors in its long-term operational stability and investor attractiveness.

The restart of CPKC's operations is a relief for supply chains, but the effects of the disruption will linger. The company's estimate of several weeks for network recovery and additional time for supply chain stabilization suggests significant challenges ahead. This disruption has likely caused inventory buildups and shortages across various industries, potentially leading to increased costs and lost sales for CPKC's customers. The company may face pressure to offer discounts or compensation to affected clients, impacting its revenue. Moreover, some customers might seek alternative transportation methods, potentially resulting in market share loss. CPKC's ability to quickly restore service levels and retain customer confidence will be important for its competitive position in the North American rail market.

CPKC (CNW Group/CPKC)

CALGARY, AB, Aug. 24, 2024 /PRNewswire/ - Canadian Pacific Kansas City (TSX: CP) (NYSE: CP) (CPKC) today said it will restart railway operations in Canada by 00:01 ET on Monday, Aug. 26, following the Canada Industrial Relations Board (CIRB) order requiring CPKC to resume operations and Teamsters Canada Rail Conference (TCRC) employees to resume their duties.

CPKC will fully comply with the CIRB order. As such, CPKC is ending the lockout initiated on Thursday, Aug. 22. CPKC has asked the TCRC for employees to return to work for the day shift on Sunday so that we can get the Canadian economy moving again as quickly as possible and avoid further disruption to supply chains. 

Our team is executing its restart plan for the safe and orderly resumption of rail service across Canada. We are working with customers on a balanced return to normal operations.

The CIRB will be convening a case management meeting with the parties Thursday, Aug. 29, to discuss the imposition of final binding interest arbitration.

As specified in the CIRB's order, the existing collective agreements between the company and the union are in force.

The CIRB's order was issued following the Canadian Minister of Labour's direction on Thursday, Aug. 22, pursuant to his authority under Section 107 of the Canada Labour Code.

CPKC looks forward to welcoming all of our Canadian locomotive engineers, conductors, yardpersons and dispatchers back to work. We are focused on restoring our railway to full strength as we get back to serving our customers and moving Canada's trade and commerce throughout North America.

The CIRB order ends months of unnecessary uncertainty and disruption for the Canadian economy and North American supply chains. We anticipate it will take several weeks for the railway network to fully recover from this work stoppage and a period of time beyond that for supply chains to stabilize.

Forward looking information
This news release contains certain forward-looking information within the meaning of applicable securities laws in both the U.S. and Canada. This news release contains forward-looking information relating, but not limited to, collective bargaining between CPKC and its labour unions, potential work stoppage and CPKC's business, operations and service. This forward-looking information also includes, but is not limited to, statements concerning expectations, beliefs, plans, goals, objectives, assumptions and statements about possible future events, conditions, and results of operations or performance.  Forward-looking information may contain statements with words or headings such as "financial expectations", "key assumptions", "anticipate", "believe", "expect", "plan", "will", "outlook", "should" or similar words suggesting future outcomes.   

Undue reliance should not be placed on forward-looking information as actual results may differ materially from the forward-looking information. Forward-looking information is not a guarantee of future performance. By its nature, CPKC's forward-looking information involves numerous assumptions, inherent risks and uncertainties that could cause actual results to differ materially from the forward-looking information, including but not limited to the following factors: changes in business strategies; general North American and global economic, credit and business conditions; risks in agricultural production such as weather conditions and insect populations; the availability and price of energy commodities; the effects of competition and pricing pressures; industry capacity; shifts in market demand; changes in commodity prices; uncertainty surrounding timing and volumes of commodities being shipped via CPKC; inflation; changes in laws and regulations, including regulation of rates; changes in taxes and tax rates; potential increases in maintenance and operating costs; uncertainties of investigations, proceedings or other types of claims and litigation; labour disputes; risks and liabilities arising from derailments; transportation of dangerous goods; timing of completion of capital and maintenance projects; currency and interest rate fluctuations; effects of changes in market conditions and discount rates on the financial position of pension plans and investments; and various events that could disrupt operations, including severe weather, droughts, floods, avalanches and earthquakes as well as security threats and governmental response to them, and technological changes. The foregoing list of factors is not exhaustive.  These and other factors are detailed from time to time in reports filed by CPKC with securities regulators in Canada and the United States. Reference should be made to "Item 1A - Risk Factors" and "Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations - Forward-Looking Information" in CPKC's annual and interim reports on Form 10-K and 10-Q. Readers are cautioned not to place undue reliance on forward-looking information. Forward looking information is based on current expectations, estimates and projections and it is possible that predictions, forecasts, projections, and other forms of forward-looking information will not be achieved by CPKC. Except as required by law, CPKC undertakes no obligation to update publicly or otherwise revise any forward-looking information, or the foregoing assumptions and risks affecting such forward-looking information, whether as a result of new information, future events or otherwise.

About CPKC
With its global headquarters in Calgary, Alta., Canada, CPKC is the first and only single-line transnational railway linking Canada, the United States and México, with unrivaled access to major ports from Vancouver to Atlantic Canada to the Gulf of México to Lázaro Cárdenas, México. Stretching approximately 20,000 route miles and employing 20,000 railroaders, CPKC provides North American customers unparalleled rail service and network reach to key markets across the continent. CPKC is growing with its customers, offering a suite of freight transportation services, logistics solutions and supply chain expertise. Visit cpkcr.com to learn more about the rail advantages of CPKC. CP-IR

 

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SOURCE CPKC

FAQ

When will CPKC restart railway operations in Canada?

CPKC will restart railway operations in Canada by 00:01 ET on Monday, August 26, 2024.

What caused the work stoppage at CPKC?

CPKC initiated a lockout on Thursday, August 22, 2024, which led to the work stoppage.

How long will it take for CPKC's railway network to fully recover?

CPKC anticipates it will take several weeks for the railway network to fully recover from the work stoppage.

What is the status of collective agreements between CPKC and the union?

The existing collective agreements between CPKC and the union remain in force, as specified in the CIRB's order.

Canadian Pacific Kansas City Limited

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