CN to take ‘significant’ hit from blockades
TORONTO Canadian National Railway will take a significant financial hit from the rail blockades that choked train traffic in Eastern Canada for most of February, but chief executive JJ Ruest is “cautiously optimistic” the disruption is behind the railroad as it turns its focus to potential impacts from the coronavirus outbreak.
“It definitely is significant,” Ruest said in an interview Tuesday regarding the financial impact from the blockades that cropped up on tracks nationwide in support of the Wet’suwet’en hereditary chiefs’ opposition to a natural gas pipeline through their traditional territory in B.C. CN was forced to stop about 460 freight trains during the blockades.
“It’s a lot of lost revenue for CN, and I’m sure a lot of lost revenue from our customers who probably lost some sales in that period of time because they could not execute,” he said. “It might be significant for Canadian economy, too.”
On Tuesday, CN called back to work most of the 450 employees it temporarily laid off during the blockades, which have mostly dispersed over the past four days since the Wet’suwet’en chiefs reached a draft arrangement with B.C. and federal officials.
CN will not reveal the exact cost until it releases financial results in April, but Ruest said the hit will be in the scale of the impact from the eight-day strike by CN employees in November. That prompted CN to cut its 2019 annual guidance by 15 cents per share, meaning it lost an estimated $140 million or $18 million per day during the labour action.
The blockades were harder to plan for than the strike given their unpredictability, which stressed both employees and customers, Ruest said.
“People were just showing up on our tracks and the crews would tell us, ‘There’s people ahead,’” he said.
“In the last 15 days, we would find on social media that something is about to happen and therefore we’re going to have to do what we can without that piece of track.”