HONG KONG: Two of China’s largest airlines have joined a growing list of carriers demanding compensation from Boeing over the grounding of its 737 Max aircraft.
Air China and China Eastern Airlines have told that they have asked to be reimbursed for costs they have incurred since the plane was deemed unsafe to fly following two crashes.
They cited losses caused by being unable to fly the aircraft and delayed deliveries of more jets. The companies did not disclose how much in damages they are seeking from Boeing .
China Southern Airlines has also asked for compensation, according to Chinese state-run media. The company did not immediately respond to a request for comment from CNN Business.
The 737 Max, Boeing’s best-selling plane, has been grounded since March. China was the first country to ban the 737 Max 8 from its skies after an Ethiopian Airlines flight crashed earlier that month, killing all 157 people on board. That followed another tragic incident in October, when a 737 Max 8 operated by Lion Air crashed off of Indonesia, leaving 189 passengers dead.
The grounding has already cost airlines hundreds of millions of dollars. American Airlines (AAL), Southwest Airlines (LUV) and Norwegian Air all revealed last month that the loss of the troubled plane has forced them to cancel a growing number of flights, and will cost them nearly $600 million combined.
Norwegian, a European low-cost carrier, has also demanded money back from Boeing recently, and United Airlines (UAL) and Ryanair are also reportedly seeking compensation.
The continuing crisis is already hurting Boeing’s bottom line. The company reported in April that profits fell 21% in the first quarter of this year because of safety questions clouding the company’s reputation.
Airlines have completely stopped ordering the jet in the wake of the two crashes. There were zero orders for the 737 Max in March, and only 10 purchases in the first quarter of 2019 compared to 112 in the same period last year, according to data released by Boeing last month.
CNN Digital Rebranding 2013
By Michelle Toh, CNN Business
Updated 0910 GMT (1710 HKT) May 22, 2019
Pilots confronted Boeing over 737 Max concerns
Pilots confronted Boeing over 737 Max concerns
trump boeing max 8 9 flights emergency grounding nr vpx_00000430
Trump: Boeing 737 Max 8 and 9 aircraft grounded
RENTON, WA – MARCH 11: The Boeing 737-8 is pictured on a mural on the side of the Boeing Renton Factory on March 11, 2019 in Renton, Washington. Two of the aerospace company's newest model airliners have crashed in less than six months. (Photo by Stephen Brashear/Getty Images)
Source: Pilots trained on Boeing 737 Max in 2.5-hour course
RENTON, WA – MARCH 14: Boeing 737 MAX airplanes, including the 737 MAX 9 test plane (L), are seen at Renton Municipal Airport, on March 14, 2019 in Renton, Washington. The 737 MAX, Boeing's newest model, has been been grounded by aviation authorities throughout the world after the crash of an Ethiopian Airlines 737 MAX 8 on March 10. (Photo by Stephen Brashear/Getty Images)
Report: Pilots raced for manuals as plane went down
A grounded Lion Air Boeing Co. 737 Max 8 aircraft sits on the tarmac at terminal 1 of Soekarno-Hatta International Airport in Cenkareng, Indonesia, on Tuesday, March 15, 2019. Sundays loss of an Ethiopian Airlines Boeing 737, in which 157 people died, bore similarities to the Oct. 29 crash of another Boeing 737 Max plane, operated by Indonesias Lion Air, stoking concern that a feature meant to make the upgraded Max safer than earlier planes has actually made it harder to fly. Photographer: Dimas Ardian/Bloomberg via Getty Images
Report: Off-duty pilot saved Lion Air flight day before crash
Rescuers work at the scene of an Ethiopian Airlines flight crash near Bishoftu, or Debre Zeit, south of Addis Ababa, Ethiopia, Monday, March 11, 2019. A spokesman says Ethiopian Airlines has grounded all its Boeing 737 Max 8 aircraft as a safety precaution, following the crash of one of its planes in which 157 people were killed. (AP Photo/Mulugeta Ayene)
Authorities: Similarities between Ethiopian, Lion Air crashes
Lion Air flight dove over 24 times before crash
RENTON, WA – JANUARY 29: A Boeing 737 MAX 8 airliner lifts off for its first flight on January 29, 2016 in Renton, Washington. The 737 MAX is the newest of Boeing's most popular airliner featuring more fuel efficient engines and redesigned wings. (Photo by Stephen Brashear/Getty Images)
Pilots confronted Boeing over 737 Max concerns
People stand near collected debris at the crash site of Ethiopia Airlines near Bishoftu, a town some 60 kilometres southeast of Addis Ababa, Ethiopia, on March 11, 2019. – An Ethiopian Airlines Boeing 737 crashed on March 10 morning en route from Addis Ababa to Nairobi with 149 passengers and eight crew believed to be on board, Ethiopian Airlines said. (Photo by Michael TEWELDE / AFP) (Photo credit should read MICHAEL TEWELDE/AFP/Getty Images)
CNN reporter: Crash report a blow for Boeing
People walk past a part of the wreckage at the scene of the Ethiopian Airlines Flight ET 302 plane crash, near the town of Bishoftu, southeast of Addis Ababa, Ethiopia March 10, 2019. REUTERS/Tiksa Negeri
Everything we know about the Ethiopian plane crash
Boeing 737 Max simulator flight
Inside the training simulator for Boeing 737 Max 8 plane
A Boeing 777X model is displayed at the Airshow China 2018 in Zhuhai in southern China's Guangdong province on November 7, 2018. (Photo by WANG Zhao / AFP) (Photo credit should read WANG ZHAO/AFP/Getty Images)
Boeing’s reputation on the line after 737 Max 8 crashes
trump boeing max 8 9 flights emergency grounding nr vpx_00000430
Trump: Boeing 737 Max 8 and 9 aircraft grounded
RENTON, WA – MARCH 11: The Boeing 737-8 is pictured on a mural on the side of the Boeing Renton Factory on March 11, 2019 in Renton, Washington. Two of the aerospace company's newest model airliners have crashed in less than six months. (Photo by Stephen Brashear/Getty Images)
Source: Pilots trained on Boeing 737 Max in 2.5-hour course
RENTON, WA – MARCH 14: Boeing 737 MAX airplanes, including the 737 MAX 9 test plane (L), are seen at Renton Municipal Airport, on March 14, 2019 in Renton, Washington. The 737 MAX, Boeing's newest model, has been been grounded by aviation authorities throughout the world after the crash of an Ethiopian Airlines 737 MAX 8 on March 10. (Photo by Stephen Brashear/Getty Images)
Report: Pilots raced for manuals as plane went down
A grounded Lion Air Boeing Co. 737 Max 8 aircraft sits on the tarmac at terminal 1 of Soekarno-Hatta International Airport in Cenkareng, Indonesia, on Tuesday, March 15, 2019. Sundays loss of an Ethiopian Airlines Boeing 737, in which 157 people died, bore similarities to the Oct. 29 crash of another Boeing 737 Max plane, operated by Indonesias Lion Air, stoking concern that a feature meant to make the upgraded Max safer than earlier planes has actually made it harder to fly. Photographer: Dimas Ardian/Bloomberg via Getty Images
Report: Off-duty pilot saved Lion Air flight day before crash
Rescuers work at the scene of an Ethiopian Airlines flight crash near Bishoftu, or Debre Zeit, south of Addis Ababa, Ethiopia, Monday, March 11, 2019. A spokesman says Ethiopian Airlines has grounded all its Boeing 737 Max 8 aircraft as a safety precaution, following the crash of one of its planes in which 157 people were killed. (AP Photo/Mulugeta Ayene)
Authorities: Similarities between Ethiopian, Lion Air crashes
Lion Air flight dove over 24 times before crash
RENTON, WA – JANUARY 29: A Boeing 737 MAX 8 airliner lifts off for its first flight on January 29, 2016 in Renton, Washington. The 737 MAX is the newest of Boeing's most popular airliner featuring more fuel efficient engines and redesigned wings. (Photo by Stephen Brashear/Getty Images)
Pilots confronted Boeing over 737 Max concerns
People stand near collected debris at the crash site of Ethiopia Airlines near Bishoftu, a town some 60 kilometres southeast of Addis Ababa, Ethiopia, on March 11, 2019. – An Ethiopian Airlines Boeing 737 crashed on March 10 morning en route from Addis Ababa to Nairobi with 149 passengers and eight crew believed to be on board, Ethiopian Airlines said. (Photo by Michael TEWELDE / AFP) (Photo credit should read MICHAEL TEWELDE/AFP/Getty Images)
CNN reporter: Crash report a blow for Boeing
People walk past a part of the wreckage at the scene of the Ethiopian Airlines Flight ET 302 plane crash, near the town of Bishoftu, southeast of Addis Ababa, Ethiopia March 10, 2019. REUTERS/Tiksa Negeri
Everything we know about the Ethiopian plane crash
Boeing 737 Max simulator flight
Inside the training simulator for Boeing 737 Max 8 plane
A Boeing 777X model is displayed at the Airshow China 2018 in Zhuhai in southern China's Guangdong province on November 7, 2018. (Photo by WANG Zhao / AFP) (Photo credit should read WANG ZHAO/AFP/Getty Images)
Boeing’s reputation on the line after 737 Max 8 crashes
trump boeing max 8 9 flights emergency grounding nr vpx_00000430
Trump: Boeing 737 Max 8 and 9 aircraft grounded
Hong Kong (CNN Business)Two of China’s largest airlines have joined a growing list of carriers demanding compensation from Boeing over the grounding of its 737 Max aircraft.
Air China and China Eastern Airlines told CNN Business on Wednesday that they have asked to be reimbursed for costs they have incurred since the plane was deemed unsafe to fly following two crashes.
They cited losses caused by being unable to fly the aircraft and delayed deliveries of more jets.
The companies did not disclose how much in damages they are seeking from Boeing (BA).
China Southern Airlines has also asked for compensation, according to Chinese state-run media. The company did not immediately respond to a request for comment from CNN Business.
An Air China Boeing 737 MAX 8 plane seen on March 11 after it was grounded in Beijing.
An Air China Boeing 737 MAX 8 plane seen on March 11 after it was grounded in Beijing.
The 737 Max, Boeing’s best-selling plane, has been grounded since March. China was the first country to ban the 737 Max 8 from its skies after an Ethiopian Airlines flight crashed earlier that month, killing all 157 people on board. That followed another tragic incident in October, when a 737 Max 8 operated by Lion Air crashed off of Indonesia, leaving 189 passengers dead.
The grounding has already cost airlines hundreds of millions of dollars. American Airlines (AAL), Southwest Airlines (LUV) and Norwegian Air all revealed last month that the loss of the troubled plane has forced them to cancel a growing number of flights, and will cost them nearly $600 million combined.
Boeing has a 'crisis of confidence.' It's time for the board to step up
Boeing has a ‘crisis of confidence.’ It’s time for the board to step up
Norwegian, a European low-cost carrier, has also demanded money back from Boeing recently, and United Airlines (UAL) and Ryanair (RYAAY) are also reportedly seeking compensation.
The continuing crisis is already hurting Boeing’s bottom line. The company reported in April that profits fell 21% in the first quarter of this year because of safety questions clouding the company’s reputation.
Airlines have completely stopped ordering the jet in the wake of the two crashes. There were zero orders for the 737 Max in March, and only 10 purchases in the first quarter of 2019 compared to 112 in the same period last year, according to data released by Boeing last month.
Leave a Reply