Logistics article(s)
September 15, 2022

The US government has averted a potential railway strike that could have wreaked further havoc on already stressed supply chains.


President Joe Biden helped secure the tentative deal on Thursday between major freight rail operators and two large unions through his Labor Secretary Martin J. Walsh after reportedly 20 hours of marathon talks.


This came as the talks of a strike had already begun affecting rail service across the United States and just hours before a critical deadline that would have allowed workers to strike.


"The tentative agreement reached is an important win for our economy and the American people," Biden said as the deal was struck. "This is a great deal for both sides, in my view."


"I thank the unions and rail companies for negotiating in good faith and reaching a tentative agreement that will keep our critical rail system working and avoid disruption of our economy," the US president added.


Averting the potential strike helped the US government avoid further inflation hikes and piling on the already stretched supply chains although the deal is not final until union members ratify the agreement. 


Suzanne P. Clark,  US Chamber of Commerce president and CEO welcomed the tentative deal which she pointed out could have caused a national rail shutdown.


"The US Chamber commends the nation's six largest railroads, the twelve unions, and the Biden administration for reaching an agreement on a new labour contract," Clark said, following the agreement.


"Our nation was very close to a national rail shutdown this week, the effects of which were already beginning to be felt throughout the business community, and would have had devastating impacts on American families and our economy. We are glad to see a rail strike averted and hope to see future negotiations finalized in a timely manner," the US Chamber of Commerce chief added.


Meanwhile, Mario Cordero, Port of Long Beach executive director, welcomed the agreement which avoided major disruptions to supply chains.


"The Port of Long Beach welcomes the stability this contract agreement provides during a time when the prompt, reliable delivery of goods has become a consumer expectation," Cordero said.


"The San Pedro Bay port complex moves 40% of the nation's cargo, and almost 30% of US freight moves by rail. It's not difficult to see what an interruption of service during the critical peak shipping season would have meant both here and for the greater national supply chain," he added.


Freight industry officials earlier warned that a strike could cost the US economy US$2 billion a day.

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