American Airlines Reaches Deal with Boeing over 737 Max Grounding

By Paul Riegler on 6 January 2020
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American Airlines said it reached a confidential settlement with Boeing over financial damages stemming from the grounding of the 737 Max, adding that it plans to share $30 million of the proceeds with employees.

The removal of the Boeing 737 Max from American’s fleet has ost the airline at least $540 million in pretax income.  The settlement will be paid out by Boeing over several years although American will include the employee share in in its 2019 profit-sharing program, which will be paid out in March.

“Despite the ongoing challenges the grounding has brought, American Airlines team members continue to do an incredible job caring for our customers,” said Doug Parker, the airline’s CEO. “Our ability as an airline to weather these unprecedented times is thanks to our phenomenal team.”

The two companies are still in discussions over compensation after 2019, the airline said in a statement.

American is the second carrier after Southwest Airlines to reach a settlement with Boeing.

U.S. regulators grounded the 737 Max on March 15, 2019 after two hull losses in a period of six months in which 346 people were killed.

(Photo: Accura Media Group)

Accura News

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