American Airlines and Boeing have reached a settlement regarding the damages caused by the grounding of all 737 MAX aircraft.
The specific terms of the agreement remain confidential, but Boeing will make payments to American Airlines over the next few years.
As part of the settlement, Boeing will commence regular compensatory payments to American Airlines. The airline, the largest in the US, plans to allocate these funds for various purposes. American Airlines intends to use $30 million from Boeing’s payments for their employee profit-sharing program. The airline has confirmed that these payments will continue according to the confidential terms of the settlement.
American Airlines has stated that the payments will not impact their fourth-quarter earnings for 2019. Negotiations for compensation are anticipated to extend into 2020. The airline’s flight attendant union has expressed support for the news and commended the airline’s decision to allocate a portion of the compensation to its workforce.
Boeing has not provided any comments on the specifics of the settlement with American Airlines. Recently, Boeing has reached undisclosed settlements with smaller US airlines. Now, a resolution has been reached with its most significant US client.
Following two plane crashes within five months due to technical issues, Boeing has been grappling with the repercussions. The 737 MAX had been one of the company’s top-selling aircraft.