As one of the key components of Canadas trade oriented economy, transportation sector

plays a significant role in the economic development of the country. The major modes of
transportation are Air, Rail, Marine, Truck, Pipeline and Intermodal employing over 938,000
people as of 2014. Therefore, it is of utmost importance to analyze the external environment
surrounding each of these sectors so as to achieve optimum performance. Hence, one of the
most popular tools used in analyzing the external environment is the PESTLE analysis
(Political, Economic, Social, Technological, Legal and Environmental Analysis). The
PESTLE analysis for each of the sectors in transportation is as follows:-

Railway
Political
Government owned railways such as Canadian National Railways and Canadian
Pacific faces major competition from private railway companies such as VIA rail.
Economic
Involves high fixed costs and low variable costs mainly due to purchase of expensive
equipment. An investment of 1.8bn dollars was made in 2015 by Canadian Railways
in service improvements and sustained growth (Railway Association of Canada,
2017). It is estimated that railways move one tonne of freight at less than 3 cents.

Recession and climbing fixed costs have lead to huge operating costs. This ultimately
lead to decline in employment even though the freight volume was increased.
Social
Canadian Railways employs more than 32,900 people and paid more than 3.1bn in
wages/benefits in 2015 (Railway Association of Canada, 2017).
Technological
LED technology & retro-reflective material are used to make crossing lights, warning
signs etc. which will provide more visibility from further distances (Railway
Association of Canada, 2017).
Usage of gamma-ray technology at borders help customs officers see content inside
railway cars.
Rail lubrication technology to reduce friction, wear, noise and consumption of energy
is also being applied.
Legal
New and revised regulations have been passed by federal government in order to
ensure railway safety and security of passengers and goods (Justice Laws, 2016).
Environmental
Railway Association of Canada limits emissions, conserves fuel and relieve highway
congestion.
Despite the huge volume of goods transported, the rail sector is only accountable for
less than 4% of greenhouse gas emissions (Railway Association of Canada, 2017).

TRUCK
Political
 Economic
Contributes to more than half value GDP in the transportation sector.

Social
Employs 67% workforce in the transportation industry.
Technological
Introduction of self-driving electric trucks will save costs as well as have
environmental benefits (CBC, 2016).
Legal
Environmental
Innovations such as battery powered trucks will emit much less greenhouse gases
compared to other means of transport.

AIR

Political
Air deregulation policies and the concept of open skies forecasts a safe future for the
air transport sector in Canada especially in passenger transportation.

Economic
Aviation industry contributed 8,123mn dollars to the Canadian economy in 2015.

Social
Faster transportation and safety record makes it the most favourable means of
transportation in the society.
Technological
Development of the most fuel efficient aircraft by utilizing state of the art technology
adds to both cost and environmental benefits.
Legal
Environmental
Development of more eco-friendly aircrafts such as the Airbus A320 neo and Boeing
787 dreamliners would help reduce CO2 emissions to a large extent.

PIPELINE

Political
Requires heavy governmental interference in setting up infrastructure and other
facilities.

Economic
Fall in oil prices has caused slowdown in the pipeline industry due to less transactions
being carried out.

Social
Technological
 Legal
Pipeline Safety Act was implemented on June 19, 2016 (Justice Laws, 2016).

Environmental
Environmental Safety is a responsibility of the National Energy Board for the pipeline
industry.

MARINE

Political
Economic
Social
Technological
Legal
Environmental

INTERMODAL

Political
Economic
Social
Technological
Legal
Environmental

References
CBC (2016) Self-driving truck makes 200km delivery. Retrieved May 15, 2017 from
http://www.cbc.ca/news/business/budweiser-self-driving-truck-otto-1.3820217

Justice Laws (2016) Railway Safety Act. Retrieved May 15, 2017 from http://laws-
lois.justice.gc.ca/eng/acts/r-4.2/

Railway Association of Canada (2017) Rail Facts. Retrieved May 15, 2017 from
http://www.railcan.ca/education/facts