American Airlines reaches settlement with Boeing for 737 MAX compensation in 2019
American, the largest U.S. airline, said the compensation will be received over several years
(Reuters) - American Airlines Group Inc (AAL.O) said on Monday it had reached a confidential agreement with Boeing Co (BA.N) to address damages the airline incurred in 2019 due to the ongoing grounding of its fleet of Boeing 737 MAX aircraft.
FILE PHOTO: An aerial photo shows Boeing 737 MAX aircraft at Boeing facilities at the Grant County International Airport in Moses Lake, Washington, September 16, 2019. REUTERS/Lindsey Wasson/File Photo
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American, the largest U.S. airline, said the compensation will be received over several years. The airline will use more than $30 million of the compensation for the airline’s 2019 employee profit-sharing program.
American said it does not expect any material financial impact of the agreement to be realized in its fourth-quarter 2019 earnings and it will continue talks regarding compensation for damages related to the MAX grounding beyond 2019.
BOEING CONSIDERING DEBT RAISE AMID 737 MAX CRISIS: REPORT
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| AAL | AMERICAN AIRLINES GROUP INC. | 14.61 | +0.09 | +0.62% |
| BA | THE BOEING CO. | 156.54 | +1.10 | +0.71% |
Boeing said it does not comment on discussions with airlines.
Boeing’s best-selling 737 MAX has been grounded since two fatal crashes in five months killed 346 people. The company is halting production this month. A number of airlines have struck confidential settlements with Boeing in recent weeks.