TUI, Boeing Reach Pact to Resolve 737 MAX Grounding Impact
June 03 2020 - 2:15AM
Dow Jones News
By Ian Walker
TUI AG said Wednesday that it has agreed a compensation package
and a new delivery deal with Boeing Co. for its 737 MAX aircraft
over the next few years that will significantly reduced capital and
financing requirements for the travel company.
TUI--which operates hotels, airlines and cruises, along with
agencies that sell vacation packages--said that while the financial
terms of the agreement are confidential, it will get compensation
for a significant portion of the financial impact of the aircraft
grounding over the next two years, as well as credits for future
aircraft orders.
Under the deal, TUI will get less 737 MAX aircraft deliveries
over the next few years than planned, with payment schedules
amended accordingly. TUI expects to get less than half of the
planned 61 MAX aircraft over the next two years with the average
delivery schedule delayed by two years.
"The agreement provides TUI with compensation for a large part
of costs that were incurred due to the grounding of the 737 MAX
fleet," Chief Executive Fritz Joussen said.
The 737 MAX has been barred by regulators from commercial flight
since March 2019 after two crashes in six months killed 346
people.
Write to Ian Walker at ian.walker@wsj.com; @IanWalk40289749
(END) Dow Jones Newswires
June 03, 2020 02:00 ET (06:00 GMT)
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