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China carriers say losses from Boeing 737 max grounding to top $500 million

Baku, May 24, AZERTAC

Chinese airlines seeking compensation from Boeing Co. said the grounding of its 737 Max jet is on track to result in losses of more than $500 million for the carriers, according to Bloomberg News.

The airlines could lose 4 billion yuan ($580 million) if the suspension lasts through June, Liu Shuguo, secretary general of the China Air Transport Association, said at a briefing in Beijing on Friday. Losses will continue to mount if the grounding lasts beyond that, said Liu, who spoke on behalf of the Chinese carriers the association represents.

Several Chinese airlines, including Air China Ltd. and China Southern Airlines Co., are seeking compensation from the U.S. manufacturer for order delays and losses caused by the grounding of its 737 Max jet in the wake of two deadly crashes. A total of 96 of the Chinese carriers’ 737 Max jets have been suspended, and the airlines were planning to introduce a further 130 of the planes this year, Liu said.

The number of Chinese airlines seeking compensation from Boeing is 13, Chinese publication the Paper reported.

It`s uncertain when the Max might return to service. U.S. aviation regulators expect to receive Boeing’s proposed software fix for the aircraft soon, and will then begin a review that will include test flights and input from a technical advisory board.

Lion Air Flight 610 was the first Max to crash, in the waters off Indonesia in late October, killing all 189 people on board. Less than five months later, a second Max crashed in Ethiopia, killing 157 passengers.

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