United Airlines Boeing 737 MAX 9

Boeing will compensate United Airlines for grounding of its 737 MAX 9

US airline reached confidential agreement with planemaker to receive compensation for financial damages in Q1, company said on Wednesday

United Airlines reported Wednesday that it reached an agreement with Boeing on April 14 to be compensated for problems affecting the 737 MAX.

The US carrier said the planemaker will pay a confidential sum to cover financial damages caused by the grounding of its 79 737-9s, established by the FAA.

The aircraft had to undergo inspections after an Alaska Airlines 737 MAX 9 had a door plug detached mid-flight in January.

In its first quarter earnings report, United Airlines had admitted a loss of US$200 million due to the grounding of its aircraft fleet.

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“On April 14, 2024, the Company entered into confidential arrangements with Boeing with respect to compensation for financial damages incurred in the first quarter of 2024 due to the Federal Aviation Administration grounding of the Boeing 737 MAX 9 aircraft,” United said.

All United Airlines’ Boeing 737 Max 9 were grounded while NTSB investigates the causes of the incident (formulanone)

737 MAX 10 delay

In addition to the problem with the 737-9, the airline also reported an agreement with Boeing to compensate for the delay in certification of the 737 MAX 10, the largest variant of the aircraft and which was scheduled to enter service in 2024.

According to United Airlines, the compensation offered by Boeing will be made through credit memos for use in future aircraft acquisitions.

“The Company plans to account for these arrangements as a reduction to the cost basis of the previously-delivered Boeing 737 MAX 9 aircraft and future deliveries of the MAX 9 and MAX 10 aircraft, which is expected to reduce future depreciation expense associated with these aircraft,” the carrier added.

Alaska Airlines Boeing 737 MAX 9 (Glenn Beltz/CC)

Despite the agreement with Boeing, United decided to expand its fleet of Airbus A321neo, a rival aircraft to the 737 MAX 10, while converting part of the model’s orders to the 737-9 version.

Boeing had already reached a settlement with Alaska Airlines in March in which it compensated the airline for around US$160 million as initial compensation.

Other customers such as Aeromexico and Copa Airlines are also expected to be compensated for the problems with the 737 MAX 9 soon.


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