Ambassador Bridge blockade hits trucking companies and auto industry
An ongoing blockade at the Ambassador Bridge – the busiest land border crossing between the United States and Canada – is starting to hit vehicle production in Canada.
Stellantis confirmed that its Windsor assembly plant “had to cut short its first shift due to parts shortages” on Tuesday. The plant was operating Wednesday morning.
“We continue to work closely with our carriers to get parts to the factory and, at this time, we expect the afternoon shift to start as planned,” the builder said. automotive in a statement to Automotive News Canada.
Representatives from Ford Motor Co. and General Motors Co. said they are monitoring the situation.
Meanwhile, shipping companies are scrambling to find other ways to get goods to Canada and the United States.
Penske Logistics, which employs more than 11,000 truckers in North America, is stopping or delaying shipments for cross-border routes that must go from Michigan to Ontario, spokesman Randy Ryerson told Crain’s. In some cases, the company re-routes loads to other border points such as Buffalo, NY-Niagara, Ontario crossing and providing real-time updates to customers.
“We are staying in very close contact with our customers to ensure they can make informed decisions about their overall supply chain strategy while working on this case,” Ryerson said in an email.
Protesters, demanding anything from an end to Canada’s new COVID-19 vaccine rules for truckers to the ousting of Prime Minister Justin Trudeau, have paralyzed traffic to and from the Ambassador Bridge starting Monday evening. On Tuesday morning, trucks were backed up for miles on Detroit freeways and surface streets near the entrance to the bridge in southwest Detroit.
The situation is further stretching an auto supply chain already weakened by pandemic-related labor shortages and chip scarcity.
Small providers who no longer have COVID relief loans and have suffered closures due to coronavirus outbreaks are particularly vulnerable, said Alex Calderone, chairman of Calderone Advisory Group, a Birmingham-based consultancy that works with struggling suppliers.
“The supply chain has been destabilized” during the pandemic, he said. “Small suppliers in particular simply cannot withstand this type of blow.”
Calderone spent Tuesday morning with a Michigan-based client who needed to send plastic parts to a supplier in Canada this week in order to do payroll, he said. They were planning an alternate route to avoid the bridge.
Canada imposed a COVID-19 vaccine requirement on all truckers entering the United States last month despite fears it could undermine supply chains and hurt the economy. The move sparked protests among truckers, farmers and junkies, which paralyzed downtown Ottawa, Canada’s capital, for more than 10 days.
About 90% of truckers in Canada are vaccinated, and trucking associations and many large truck operators have denounced the protests. The United States has the same vaccination rule for truckers entering the country, so it wouldn’t make a difference if Trudeau lifted the restriction.
“The protests in Ottawa Canada and at the Ambassador Bridge are less and less about vaccines and more and more about political extremism and a desire to disrupt the Canadian government and economy (done with radical external influences and l ‘money),’ former US ambassador Bruce Heyman said. in Canada, tweeted.
The disruption has spread beyond the auto industry. Henry Ford Health System, one of Detroit’s largest hospital chains, said some staff experienced minor delays and inconvenience due to rerouting. Restaurant supplier Sysco Corp. said it is having slight problems getting orders from Canadian fulfillment centers to local restaurants.
“It’s taking longer to deliver. We think it’s a short-term situation,” Sysco CEO Kevin Hourican said. “I think what you are seeing is a reaction to some of the decisions taken by the government, which were very strict.”
Officials urged commercial traffic to use the Blue Water Bridge to the north, which connects Port Huron and Sarnia, Ont. The Detroit-Windsor tunnel remains open to non-commercial traffic between the two countries.
Automakers and suppliers are monitoring the situation, with some warning that their operations could be disrupted if the Ambassador Bridge remains closed.
“Basically, if there’s a closure of transportation lanes, the auto industry comes to a screeching halt in about two days,” Robert Wildeboer, executive chairman of Martinrea International Inc., told BNN Bloomberg Television on Tuesday.
Slowdowns are a problem for Martinrea, which is based in Vaughan, Ontario, but has locations in the United States and around the world, including a technology center in Auburn Hills. “We have 38 trucks crossing the Detroit border a day and 16 in Sarnia,” Wildeboer said.
He called on Trudeau to reverse new rules that require truckers to be vaccinated against COVID-19 to enter the country.
Overall, more than 25% of goods traded between Canada and the United States transit through the Ambassador Bridge.
At the micro level, an estimated 7,000 trucks cross the Windsor-Detroit corridor every day, according to the Windsor-Detroit Bridge Authority, while about 2.5 million trucks cross the bridge each year. The authority says these cargo trucks, which include auto parts and new vehicles, account for more than $100 billion in two-way trade each year.
The Canadian Vehicle Manufacturers Association, which lobbies on behalf of Detroit 3 automakers in Canada, called for an immediate end to the protests.
“Blockages at Canada’s borders threaten fragile supply chains already under strain due to pandemic-related shortages and backlogs,” CVMA CEO Brian Kingston said in a statement. “We call for cooperation from all levels of government to resolve this situation and end these lockdowns immediately.”
Kingston called the crossing “a key conduit for motor vehicles and parts, Canada’s second largest export.”
“Automotive production relies on an efficient supply chain for the delivery of parts, components and vehicles,” he said. “Continued delays at the Ambassador Bridge risk disrupting auto production that employs tens of thousands of Canadians.”
— Crain’s Detroit Business reporter Kurt Nagle, Automotive News reporter Greg Layson, Bloomberg and Associated Press contributed to this report.