China Eastern asks Boeing for compensation over 737 MAX grounding

People walk past a booth of China Eastern Airline at an air show, the China International Aviation and Aerospace Exhibition, in Zhuhai, Guangdong Province, China, November 3, 2016.
China Eastern Airlines has formally requested compensation from Boeing Co for the grounding of its 14 737 MAX aircraft and has delayed deliveries of future planes, the company said on Tuesday.

The airline’s move was first reported by domestic media, including the state-run People’s Daily newspaper. The reports did not say what amount of compensation the airline is seeking.

“The grounding of 737 MAX aircraft since March 11, 2019 has caused relatively big losses to China Eastern. With the passing of time, related losses will further expand,” the paper cited the company as saying.

“At the same time, delayed deliveries of planes ordered by China Eastern also caused economic losses.”

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An airline spokesman confirmed its comments in the People’s Daily report to Reuters.

China Eastern has 14 Boeing 737 MAX jets in its fleet, including those from subsidiary Shanghai Airlines. The aircraft have been mothballed according to aircraft maintenance standards, the People’s Daily said.

The company had not communicated with other carriers regarding compensation, it added.

A spokesman for Boeing declined to comment on China Eastern’s move, saying it did not discuss conversations with its customers.

The U.S. Federal Aviation Administration is hosting a meeting of global regulators in Dallas on Thursday to review software and training proposals from Boeing before deciding whether, and when, to end the two-month grounding.

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China and the European Union each have their own aerospace industries and are likely to fix their own conditions for allowing 737 MAX flights to resume, analysts say.

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