No Soup For You!

May 21, 2013
… or make that, ‘No passenger bridges for you!”

Or clean planes, for that matter. And don’t even mention unloading cargo and luggage.

We posted an interesting news story yesterday about LAN Airlines suspending its flights in Argentina as the result of a contract dispute with its one-and-only ground handler, the state-run Intercargo.

For one reason or another, we couldn’t get scenes from the old “Seinfeld” show out of our heads.

Back in 2010, Argentina’s government helped prop up another state-run business, in this case, Aerolinas Argentinas by passing a law that gave the ailing flag carrier priority to use all the country’s passenger bridges. That law changed a bit to allow carriers to use the bridges for up to two flights a day.

That might work for foreign carriers with limited flights, but LAN Argentina had far more than a couple of daily domestic flights.

LAN found a way to work around the law – one reason may be that it contracted with monopoly Intercargo.

But things between the two fell apart earlier this year. First, Intercargo took away the boarding bridges. And since the airline couldn't use the bridges, the planes were parked remotely, which meant passengers would have to take buses back and forth between terminal and plane. Not exactly what today's traveller wants.

Afterward, Intercargo said they wanted more money and complained in the press that LAN pays 40 percent less than other carriers for the same services. "No other company has benefitted as much in recent years," Intercargo said in a statement. In other words, DO cry for me, Argentina.

Intercargo ignored its contract and stopped providing much of anything to the airline. Not even buses to transport the passengers.

For its part, LAN suspended all its flights in Argentina last Friday.

But LAN planes were back in the air by Sunday after both airline and ground service provider reached some type of an accord. What the terms of that deal are, however, remain a mystery this morning. But you have to figure that its one-day "boycott" wasn't going to work against a state-run operation.

We could only find this report that says the airline vowed to “pay its debt” and pay Intercargo “full fares” for its services and, finally, to drop any lawsuits against the ground handler.

And those full fares? LAN sources said Intercargo charges the highest fares in the Americas, saying that its basic fare for an airplane at the Ezeiza Airport is $3,200 while the same plane pays $1,500 in New York’s JFK airport and $800 in Sao Paulo.