Tui strikes compensation deal with Boeing for grounding of the 737 Max plane
Tui said Boeing would provide compensation for a significant portion of the financial impact of the grounding of the 737 Max
Tour operator Tui has struck a deal with aircraft maker Boeing for compensation over the 737 Max plane, netting a cash bonus to fight the impact of the pandemic.
The travel specialist said Boeing would provide it with compensation for a significant portion of the financial impact of the grounding of the plane, which had hit its earnings over the last year.
Boeing will also give it credits for future orders, and agreed that Tui will get fewer 737 Max aircraft over the next few years.
Deliveries are expected to be delayed by about two years, reducing Tui’s expenditure at a time when cash is tight.
The exact details of the companies’ settlement have been kept confidential.
Tui said in May it expected to axe 8,000 jobs and shed 30 per cent of its costs after the coronavirus halted holidays, bringing it to a standstill.
The company said the agreement with Boeing would help it shrink its airline businesses, which it is doing amid predictions the travel market will take several years to recover from the pandemic.
All 737 Max craft were grounded in March 2019 after two crashes killed 346 people.