Trudeau Plays Dangerous Game Demanding U.S. Truckers Have Shots
(Bloomberg) -- Canada plans to start turning away unvaccinated U.S. truckers at the border this weekend, a move that threatens to upend the flow of everything from food to auto parts to building supplies between two of the world’s largest trading partners.
Only 50% to 60% of U.S. truckers are vaccinated, according to an estimate from the American Trucking Associations. The rules will make thousands of drivers ineligible for cross-border shipments, exacerbating a shortage at a time when the transportation industry is already strained.
Manufacturers are warning they may be forced to slow production and will likely face higher costs from the snarling of a supply chain that depends on an open border for the movement of some $45 billion worth of goods every month. Canada is the top export market for 32 U.S. states, according to the Department of Commerce.
Shipping will get disrupted in both directions, as the U.S. is the set to impose its own vaccine mandate on foreign travelers on Jan. 22. In Ottawa, Prime Minister Justin Trudeau’s government confirmed Thursday that truck drivers from Canada will be affected as well -- forced into quarantine if they try to re-enter their own country and can’t show proof of vaccination.
“I’m sure you’ve been to a grocery store and seen empty shelves, and it’s not going to get any better,” said Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University and one of Canada’s top experts on the food supply chain.
The new rules could cause a bigger disruption to cross-border shipments than the outbreak of the virus did in March 2020. At the time, Trudeau’s government and the Trump administration agreed to close the land border to non-essential travelers, but trucks were allowed to keep moving. The deal helped quell some of the panic in Canada from consumers who rely on food imported from the U.S. and Mexico, especially in the winter.
In Webberville, Michigan, about an hour’s drive west of Detroit, trucking CEO Brian Hitchcock is preparing to lose revenue. Shipments across the border represent about 40% of business at MBH Trucking LLC, with regular hauls of fertilizer, liquids and other goods, but only four of its 10 drivers are vaccinated.
“We’re going to see people leaving over this,” Hitchcock said in an interview. He won’t force his drivers to get the shot. “How can I, the fourth generation of a family-owned business, mandate something that affects someone’s health? America’s about choice. We’re not allowing that.”
To avoid further supply disruptions, Dalhousie University’s Charlebois said the Trudeau government should back down, or at least delay the implementation of the border vaccine mandate.
“Omicron is hitting the entire food industry. That’s what’s been slowing things down, and the vaccine mandate could add fuel to the fire,” Charlebois said.
Canada is already 23,000 drivers short of what’s needed to meet demand, one of the reasons the continent’s supply chain has been struggling, said Stephen Laskowski, president of the Canadian Trucking Alliance. The pain will ultimately be felt by consumers in the form of higher prices; more than 70% of cross-border trade moves by truck, he said.
“I just want to reassure Canadians that we’ve been working very, very hard to ensure that supply chains continue to flow,” Canadian Trade Minister Mary Ng said at a news conference this week.
On Thursday, the U.S. Supreme Court blocked the centerpiece of President Joe Biden’s push to get more people vaccinated, rejecting a rule that would have required 80 million workers to get shots or periodic tests. Without vaccination mandates, it remains a question how many more U.S. truck drivers will get the shot.
“It is going to be an absolute challenge come Saturday for U.S. fleets trying to get into and out of Canada with the current driver pool and vaccination rates,” said Bob Costello, chief economist and senior vice-president of international trade policy for the American Trucking Associations. “There will be less capacity to haul this freight and it’ll drive up prices.”
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