MercoPress. South Atlantic News Agency

Lan back in the air in Argentina after yielding to ground services boycott

Nationalized Intercargo suspended all ground services to Lan despite court decisions

Chilean company Lan Airlines said on Saturday it was “gradually resuming” domestic and international flights in Argentina that it had suspended on Friday due to a conflict with state-run Intercargo company. Intercargo said it had re-established the service to Lan after the airline agreed to cancel a debt.

The first flights of Lan, which is part of the LATAM Airlines Group (Lan Chile and Tam from Brazil), departed on Saturday at 8am from Buenos Aires. Some flights were rescheduled and the company said that it was keeping passengers informed through a phone number and its website. Lan said Friday’s suspension of all its flights to and from Argentina was the result of Intercargo’s having halted services.

Intercargo manages services for the loading and unloading of luggage on airplanes, the transportation of passengers on buses to terminals, and provides the jet bridge services that connect aircraft to the airport, allowing passengers to embark and disembark.

Intercargo meanwhile said that it resumed services for Lan after, it added, both companies reached an accord whereby the air carrier vowed to pay its debt.

Intercargo also stated that Lan agreed to pay full fares for its services and drop any lawsuits against it. Intercargo also said that Lan agreed to pay full fares for its services and drop any lawsuits against it.

“Chilean Group Lan decided to abide by the prevailing regulations on fares for luggage service,” Intercargo said in a statement.

It added that Lan also agreed to “pay the full fare as listed in the price list, respecting an equal treatment among airlines and refraining from any demand that may imply any kind of privilege.”

According to Intercargo Lan agreed to pay 20 million pesos in a single instalment. It added that it agreed to charge Lan a stable fare over 12 months providing that fares for Argentine carriers or Argentine-registered aircraft are not increased in Chile.

Lan had taken the case to court after Intercargo demanded an “additional payment that had not been included in the contract,” private news agency DyN reported. On Friday a judge granted Lan an injunction ordering Intercargo to continue providing services while he considered the complaint.

Intercargo suspended services for Lan despite the court decision, DyN said.

The accord between the two companies was signed on May 9, 2012 and runs through March 31, 2014. On March 27 Intercargo suspended airport gangway services that allow passengers to board planes directly from terminals, and told LAN that it wanted the contract to be raised by 18 million dollars, an increase of 55 percent.

Intercargo said in a statement that “no other company has benefited as much in recent years.” According to local media Lan’s corporate affairs manager, told local television on Friday that Intercargo was not letting flights leave from any airport in the country.

He added that it was demanding Lan “to pay 100 million pesos and yesterday (for Thursday) told us that we either pay 40 million pesos or they would suspend the service. We are up to date with payments and have an injunction issued today (for Friday) whereby Intercargo is forced to continue providing the service.”

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

The Chile-based airline has domestic operations in Argentina, Brazil, Chile, Colombia, Ecuador and Peru.

Intercargo was nationalized in 2012 and has control over all ground services in all Argentine airports. As happened with nationalized Aerolineas Argentinas, the company fell under the control of La Campora which is the youth militant group headed by the son of President Cristina Fernandez, Maximo Kirchner.