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Southwest Airlines Reaches Preliminary Settlement With Boeing for Some of its 737 Max losses.

Southwest Airlines Reaches Preliminary Settlement With Boeing for Some of its 737 Max losses.

Southwest Airlines Reaches Preliminary Settlement With Boeing for Some of its 737 Max losses.



Southwest Airlines has announced that it has reached a preliminary settlement with Boeing over the grounding of its 737 Max fleet, the company said Thursday.

The airline’s chief executive, Gary C. Kelly, said the company will share will contribute approximately $125 million with its employee, through Southwest’s profit-sharing plan.

“Our people have done an incredible job managing through the MAX groundings, while providing the highest levels of customer service and one of the best operational performances in our history,” Kelly said in a news release.


Southwest said terms of the settlement with Boeing was confidential and only cover a portion of the expected damages from the Max grounding. It had 34 of the airplanes when it was grounded, but Boeing is late on deliveries of at least 27 planes that the airline expected by the end of 2019.

The company emphasized that the agreement is only a partial settlement and that it continues “to engage in ongoing discussions with Boeing regarding compensation for damages related to the Max groundings.”

Southwest, United and American have had to cancel tens of thousands of flights as the grounding has dragged on. On Thursday, American became the first of the three airlines to push back the plane's return until early April at the earliest. The airline previously had it coming back in early March, a timeline that has been repeatedly revised. United and Southwest still show it returning in March, but that is subject to change.

In a statement, a Boeing spokesman said: “We do not comment on discussions with particular customers, but we are working closely with all of them to support them through this difficult time.”

The Southwest Airlines Pilots Association is also suing Boeing for more than $100 million because of lost wages and other financial damages from the Max grounding. The union said it will continue the lawsuit against Boeing.

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