'Christmas is not canceled' despite growing risk of rail strike

By Matt EganUpdated: Tue, 22 Nov 2022 20:35:32 GMTSource: CNN BusinessLeading retailers are sounding the alarm about the danger of a national rail strike while simultaneously stressing that a potentia

By Matt Egan

Updated: Tue, 22 Nov 2022 20:35:32 GMT

Source: CNN Business

Leading retailers are sounding the alarm about the danger of a national rail strike while simultaneously stressing that a potential work stoppage won't ruin this holiday shopping season.

"Christmas is not canceled," Brian Dodge, president of the Retail Industry Leaders Association, told CNN in a phone interview on Tuesday.

Dodge, whose trade group represents Walmart, Target, Home Depot and dozens of other brands, said most products destined for store shelves and homes across America this holiday season are already at distribution centers or in stores.

"The more acute concern is early next year," said Dodge, who joked that "Santa moves his own cargo."

Still, the retail executive conceded that a rail strike in early December could disrupt the shipment of some larger and bulky items that rely on rail to get to consumers this holiday season.

Concerns about a rail strike have mounted after the largest rail union announced Monday its rank-and-file members have rejected the tentative agreement reached in September.

A prolonged rail strike could cause product shortages and price spikes as nearly one-third of all freight in the United States moves by rail.

"It would utterly upend the supply chain," Dodge said, adding that concern among retail CEOs is "high" because the risk of a national rail strike is high.

Dodge said businesses are working on contingency plans and pressing the Biden administration and Congress to do everything they can to avoid a strike. Alternatives would be considered where possible, including moving goods by truck or air.

But given the scale of what is moved by rail, Dodge said it would be "virtually impossible to work around a strike in its entirety."

The head of the Sheet Metal, Air, Rail Transportation union, or SMART-TD, left open the possibility of reaching a deal.

"A strike could be averted. The ball is back in the carriers' hands at this point," SMART-TD President Jeremy Ferguson told CNN on Tuesday. "It will be a difficult process. We will do our best. We want to keep America moving."

Dodge, the retail exec, said his trade group has been in touch with the Biden administration and lawmakers to underline the importance of avoiding a strike.

"We want a deal. That is the best way out of this," he said.

But failure to reach a deal will put Congress under enormous pressure to intervene by halting a strike.

"A strike is utterly unacceptable," Dodge said. "If a deal can't be reached, Congress has the power and obligation to act."