Southwest reaches a deal with Boeing over MAX

Southwest Airlines has reached a confidential agreement with Boeing relating to the financial damages incurred due to the grounding of the airline’s 737 MAX jets. The US LCC stated that it is in further talks with Boeing over future compensation for the groundings through a reduction in cost basis for existing and future firm aircraft orders. Following the agreement, the airline intends to issue a US$125 million profit-sharing disbursement for the employees tied to the projected reduction in operating income for 2019 due to the MAX groundings. The airline said it plans to provide 2019 profit-sharing details early next year, including the percentage each eligible Southwest employee will receive. Southwest operated 34 MAX 8s out of a total order for 280, before the FAA grounded the model on March 13, following the loss of a Lion Air and Ethiopian Airlines MAX that claimed the lives of 346 people. Southwest has placed an order for 30 of the larger MAX 9 variant.