The railway industry in Mexico is gearing up to offer transportation services for fresh and frozen products, a service expected to start rolling on train tracks in 2025. However, this requires infrastructure and inspection points, which are currently lacking but are being worked on by both Grupo México Transportes (GMXT) and Canadian Pacific Kansas City (CPKC) of Mexico.

“It’s a very relevant business area that can strengthen Mexico’s international trade in the agricultural sector, which is of great importance to the local economy. It’s a great opportunity to transport fresh and frozen products by rail, as well as sweet bakery products and others such as beef, chicken, and pork for importation to the United States and Canada,” according to the Mexican Railway Association (AMF).

José Miguel Baena, Commercial Director of GMXT, confirms that this transportation division of Grupo México is working to start transporting refrigerated products, which would begin next year. The service would be with their own equipment, he adds.

“We have a couple of big projects to start working on as a cold chain; we’re already on it, and I believe you will have news in the coming months. The idea is to export vegetables and greens to the United States; we’re looking for partners to make investments in terms of equipment, warehouses, and more, but we’re already working on it,” he says.

He mentions that they would be working on the basis of this project by 2024. Although he details that one of the challenges would be the efficiency of freight, as the cold chain cannot be lost, so strategic allies and the trust of customers are required.

INVESTMENTS ON THE HORIZON

CPKC of Mexico is also making investments to build suitable infrastructure to have a cold chain that allows providing this type of service in the country. In addition, it already has a thousand refrigerated containers that it expects to put into full operation by 2025.

“Comment and follow us on X: “@evandeltoro / @GrupoT21

El cargo Refrigerated services will take the steel way. apareció primero en T21.

On May 22, a strike by Canadian National (CN) and Canadian Pacific Kansas City (CPKC) workers could erupt, affecting essential supply chains across North America and significantly restricting trade between Canada, the United States, and Mexico.

On May 1, employees of these railways voted with over 97% in favor of a potential strike if agreements on their labor demands are not reached, reported the Teamsters Canada Rail Conference (TCRC).

Paul Boucher, president of the Conference, stated that this strike would greatly impact the supply chains of both railways.

“The Conference has been from the beginning, we are here to negotiate, the three committees continue without any commitment from the companies at the negotiation tables,” he said.

He considered the railways to be “playing a dangerous game with safety,” as they are trying to change collective safety agreements.

“They claim they want to have a modernized agreement, but in reality, they won’t move forward for decades. Our members have articles within their collective agreements that protect their rights to mitigate fatigue. Different work periods can lead to significant safety risks,” he said.

CN stated that the TCRC has made it clear that it will not accept moving towards a more modern agreement based on an hourly rate and a schedule that would have provided significant wage increases and offered scheduled consecutive days off, provisions for no layoffs, and reduced hours away from home.

“In an effort to reach a negotiated agreement, CN suggested a simplified and alternative path to achieve an agreement before the earliest possible strike date of May 22. CN’s suggestion was designed to protect the Canadian supply chain, the North American economy, and, equally important, ensure that employees receive fair treatment,” it stated.

It noted that despite five months of constant discussions, the Conference has made very few concessions towards a negotiated agreement and has not been clear about what it is seeking for employees, aside from continuing to focus on a list of approximately 200 local and regional demands unrelated to a modern consolidated agreement that benefits both employees and customers.

Meanwhile, CPKC mentioned that a labor strike would disrupt essential supply chains across North America and significantly restrict trade between Canada, the United States, and Mexico.

“CPKC does not want a labor strike. We remain focused and dedicated to reaching balanced and responsible agreements through the collective bargaining process. CPKC is committed to negotiating in good faith and responding to our employees’ desire for higher wages and a better work-life balance, while respecting the best interests of all our railroaders, their families, our customers, and the North American economy,” it stated.

It recalled that it has made two distinct offers to TCRC leaders. Both options, it said, provide significant benefits to employees and fully comply with new Canadian regulatory requirements for rest and “do not compromise safety in any way.”

It clarified that the first offer promises significant wage increases, which are possible through a simplified time-based payment method and a better work-life balance through schedule predictability and set days off. The second offer proposes competitive wage increases and maintains the status quo for the rest of the collective agreement, with one exception: addressing a single salary item at the away-from-home terminal to account for Canada’s new regulated rest regime.

According to Canada’s Labor Code, April 30 was the last day of the 60-day conciliation period. The parties now begin a mandatory 21-day mediation period with federal mediators. If the parties do not reach new collective agreements during the mentioned period, a legal labor strike could occur starting Wednesday, May 22. Canada’s Labor Code requires a minimum 72-hour notice before a strike or lockout.

TCRC and CPKC leaders are scheduled to meet again during the week of May 13.

Comment and follow us on X: @GrupoT21

OSCAR DEL CUETO

El cargo Strike at CN and CPKC would affect North America trade apareció primero en T21.

“Last year was truly historic,” are the first words read from Keith Creel, President and CEO of Canadian Pacific Kansas City (CPKC), in his message to shareholders in the company’s 2023 annual report. And rightfully so. Historic because the merger between Canadian Pacific (CP) and Kansas City Southern (KCS) was finalized, which began operations on April 14, 2023, birthing the first provider of railway services connecting North America in a single line, none other than in the world’s largest commercial zone.

The merger of these Class 1 railway companies also helped boost the region’s competitiveness by strengthening support for small and medium-sized enterprises (SMEs) and multiple industries based in Canada, the United States, and Mexico through the implementation of new services for the transportation of their goods, even aimed at addressing the significant demand for cargo movement resulting from the phenomenon of production line relocation (nearshoring).

From the first month of operations, CPKC made it clear that it was building a stronger and more diversified network. Hence, it launched the Mexico Midwest Express (MMX), a premium intermodal service offering a single line between Mexico and Chicago, without the need to exchange trains at the border, competitive in both transit times and costs when compared to road transport.

“It’s a service that has been well-received in the market. With service from San Luis Potosí to Chicago, with very good transit times, even 98 hours, competitive; and that even forced the competition to create other similar routes,” said Oscar Del Cueto, President and Executive Representative of the railway in Mexico, in an interview.

In conjunction with this announcement, CPKC also signed a new multi-year agreement with Schneider National, one of the largest providers of transportation and logistics services, to provide new single-line intermodal transportation services in the north-south corridor of the railway connecting Canada, the United States, and Mexico.

To increase its capacity in this freight transportation market, CPKC progressed with the construction of the second section of the international railway bridge in Laredo/Nuevo Laredo, expected to be completed by the end of 2024.

Comment and follow us on X: @evandeltoro / @GrupoT21

El cargo CPKC of Mexico: A Historic and Successful First Year apareció primero en T21.