The financial terms of the settlement were not disclosed. The Seattle Times reported exclusively in January that Boeing had then offered an amount on the order of $500 million to $600 million, a large portion of which was not cash but concessions, including discounts on future airplane sales and waivers on maintenance costs… A person with knowledge of the final settlement said Saturday that it included a payment of $280 million in cash, discounts on future planes, free maintenance and parts for three years, and replacement of the aircraft that crashed — with an estimated value for the total package less than $600 million.
The settlement comes as Ethiopia is torn by a bloody civil war in the northern region of Tigray that has frayed relations with the U.S. and undermined its economy. Meanwhile, the state-owned airline has struggled for 18 months with the extreme downturn in air travel due to the global COVID-19 pandemic. Parallel to the settlement over the MAX, Ethiopian Airlines this week made public a related agreement: Boeing will partner with Ethiopian to make the airline’s base in Addis Ababa “Africa’s aviation hub” and to set up a manufacturing facility there to make airplane parts.
The Times also looks at what’s changed for Boeing since their two fatal crashes:
This summer, the FAA slowed certification of Boeing’s next new plane, the 777X; directed Boeing to rework its flight manuals for both the 777X and MAX 10 to include detailed emergency pilot procedures; and ordered Boeing to improve the independence of engineers working on airplane certification, after a third of those surveyed by the FAA said they feel they cannot raise safety concerns without interference… With deliveries of the 787 suspended, restoring the MAX to market acceptance is now central to Boeing’s cash generation.
The jet has been back in service since late December, and more than 300 MAXs are now carrying passengers globally. Even as the pandemic continues to suppress air travel, Boeing is building new MAXs at a rate of 16 jets per month with a plan to increase production to 31 per month early in 2022. By year end, Boeing hopes to deliver more than 200 of the MAXs that were parked during the prolonged grounding…
In January, Boeing escaped serious consequences from a criminal investigation into the MAX crashes when the Department of Justice imposed a fine of $244 million, a relatively small amount for Boeing. Boeing’s ongoing estimate of the total cost of the MAX crisis in financial filings has stabilized at about $21 billion, of which almost $9 billion is compensation to airline customers. Wall Street doesn’t expect that to grow…
The upgraded flight controls on the MAXs flying today include fixes to the MCAS design flaws. And all MAX pilots undergo simulator training specific to the system before they fly the aircraft.
Read more of this story at Slashdot.