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Chinese airlines seek 737 MAX compensation
May 31st 2019
China Eastern initiated claim, Chinese aviation trade body will help other airlines. Read More »
China’s airlines are expanding the list of airlines worldwide publicly seeking compensation from Boeing for the grounding of the 737 MAX.
The China Air Transport Association (CATA) said it would help member airlines claim compensation from Boeing, but it is unclear if the association would have a coordinated approach or work with airlines individually.
China Eastern initiated the compensation claims and was followed by Air China and China Southern. China Eastern confirmed to Reuters a People’s Daily article that said China Eastern was acting individually. However, Global Times said there was a coordinated approach.
The Big Three carriers account for 53 of the 96 MAXs that Chinese airlines have grounded. Chinese airlines were due to receive 130 MAXs this year, the China Daily reports.
CATA estimated losses to be US$580 million by June 30. This calculation will likely grow since current estimates have the MAX returning to service no earlier than August. CATA’s figures imply a revenue loss not a profit loss.
There has been much commentary about weaker than expected passenger volumes and aircraft movements. Less discussed is a yield benefit from decreased capacity. Chinese carriers have often had to grow faster than they would like in order to meet growth targets, as seen in performance figures with stronger volume growth than yield quality.
