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Boeing makes $100 million pledge for 737 MAX crash-related support

8 Comments
By Eric M. Johnson and Tracy Rucinski

Boeing said on Wednesday it would give $100 million over multiple years to local governments and non-profit organizations to help families and communities affected by the deadly crashes of its 737 MAX planes in Indonesia and Ethiopia.

The move appears to be a step toward repairing the image of the world's largest planemaker, which has been severely dented by the crash of an Ethiopian Airlines plane in March just five months after a similar crash of a Lion Air flight in Indonesia.

The two crashes killed a total of 346 people.

Boeing is the target of a U.S. Department of Justice criminal investigation into the development of the 737 MAX, regulatory probes and more than 100 lawsuits by victims' families.

The multiyear payout is independent of the lawsuits and would have no impact on litigation, a Boeing spokesman said.

The $100 million, which is less than the list price of a 737 MAX 8, is meant to help with education and living expenses and to spur economic development in affected communities, Boeing said. It did not specify which authorities or organizations would receive the money.

Many of the passengers on board the Ethiopian Airlines flight were aid workers or involved with health, food, or environmental programs.

"If the money is spent on furthering the work of the people on that airplane it would be money well spent," said Justin Green, a New York-based attorney representing several of the Ethiopia crash victims.

But he said the fund would not affect his clients' courtroom strategy: "What families really want to know is why this happened. Could this have been avoided?"

Anton Sahadi, a representative of relatives of the Lion Air crash victims, said the families appreciated the $100 million fund but it did not mean they would stop lawsuits.

"We will continue to fight for our rights in the courts," he said. "Boeing is doing this to build their image back."

CHARM OFFENSIVE

After the Lion Air crash on Oct. 29 Boeing started developing a software https://www.reuters.com/article/us-ethiopia-airplane-southwest/boeing-sees-fix-for-latest-737-max-software-flaw-in-september-idUSKCN1TS26Q?enowpopup fix on a stall-prevention system called MCAS believed to have played a role in that disaster, as well as in the Ethiopian crash.

The 737 MAX was grounded worldwide after the second crash and regulators must approve the fix and new pilot training before the jets can fly again.

But just last month, regulators identified a new problem that will delay commercial flight for the jets until October at the earliest.

Boeing is in settlement talks over the Lion Air litigation and has separately offered to negotiate with families of Ethiopian Airlines victims, but some families have said they are not ready to settle, exposing the planemaker to a lengthy court battle.

"The Boeing brand is worth far more than $100 million and the board and executive leadership understand that is what is at stake," said William Klepper, a Columbia Business School professor.

Following an initial response that public relations experts criticized as stilted and lawyer-driven, Boeing has been on a charm offensive, with executives at the Paris Airshow last month repeatedly apologizing for the loss of life. Boeing Chief Executive Officer Dennis Muilenburg posts regular Twitter updates on efforts to safely return the 737 MAX to service and win back public confidence.

Robert Clifford, a Chicago-based attorney with several of the Ethiopian crash cases, suggested some of Boeing's $100 million pledge could be spent assisting efforts to return the remains of victims to their families.

"These families are distraught about the effort to get back their loved ones," Clifford said. "They want closure."

Boeing has also offered to match any employee donations in support of the families and communities impacted by the accidents through December.(Reporting by Eric M. Johnson in Seattle and Tracy Rucinski in Chicago; additional reporting by Cindy Silviana in Jakarta and Tina Bellon in New York; editing by Bill Rigby and Grant McCool)

© (c) Copyright Thomson Reuters 2019. Click For Restrictions - https://agency.reuters.com/en/copyright.html

©2019 GPlusMedia Inc.

8 Comments
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I'll never fly a MAX plane and neither will you. It's a lemon and airlines with this plane are going to regret using it.

6 ( +6 / -0 )

Around US$290,000 per victim - a bargain for Boeing - their 2018 profit was $10.5bn. This US$100mn is just less than 1% of their profits.

0 ( +1 / -1 )

If the victims will really get US$290,000 which is very unlikely considering other stakeholders like lawyers, ethopian airlines, ethopian government officials. I will not be surprised if some victims get less than us$10,000

3 ( +3 / -0 )

Around US$290,000 per victim - a bargain for Boeing

this is only a pledge , the law suits haven't even been decided yet. Ill say its going to cost Boeing a lot more than $100 million , prabably into the $billions.

3 ( +3 / -0 )

Blame the merger with McD D for this. The 777 was the last true Boeing plane, and is a fine one at that. Lockheed should have buried Douglas after the crapola DC 10.

-1 ( +1 / -2 )

If it's not Boeing.... I'm not dying.

0 ( +0 / -0 )

I wonder if the pencilneck accountants that pushed faulty, yet cheaper, design fixes will be punished?

1 ( +1 / -0 )

I wish, we, as the consumer, were allowed to choose which type of aircraft we were booked upon at the time of purchasing a ticket. Right now, this is not an option.

The 737 series, when it was launched originally, also suffered a similar issue.. the 737 Max series which pretended to be similar to the 737 series has likewise suffered a series of issues... what is common to both problems needs to be addressed. And patch up jobs that we are now seeing, is not the answer. The US FAA needs to stop being tied to Corporations and be itself Independent and accountable. If they approve a new aircraft, and it fails, they need to be held accountable just as much as the OEM does.

Boeing is supported by US Government Military contracts, so won't disappear, any time soon, so suing them makes sense.... but what is the price upon Life ?

Who decides that ?

0 ( +0 / -0 )

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