China's big three airlines are seeking Boeing compensation over 737 MAX grounding

BEIJING (Reuters) – China's three largest airlines have asked the US plans Boeing Co to compensate for ground-borne losses and 737 MAX jet delayed deliveries, just as regulators gather to discuss design changes for the troubled aircraft.

FILE PHOTO: The Boeing logo is depicted at the Latin American Business Aviation Conference & Exhibition (LABACE) at Congonhas Airport in Sao Paulo, Brazil, August 14, 2018. REUTERS / Paulo Whitaker / Photo

The Triple Compensation Requests a sensitive time in China-US relations, with a number of tit-for-import tariffs culminating in Washington, and accusing Beijing of recalling almost every aspect of a proposed trade agreement.

The US administration's latest tariff increase of $ 200 billion for Chinese imports – and more about it – has led to fears that China could oppose US firms.

On Wednesday, Air China Ltd and China Southern Airlines Co Ltd told Reuters that the couple have cast their votes for a compensation request from China Eastern Airlines Corp. Ltd. announced a day earlier.

The latest requests were first reported by Chinese state television.

China was the first country to report 737 MAX two months ago after a crash in Ethiopia killed 157 people in March, in the second such event for Boeing's latest aircraft.

"China has due to 96 aircraft, which is about 4 percent of its aircraft. Earthing causes major losses for Chinese airlines," said Chinese aviation specialist Li Xiaojin of Reuters.

Daily losses will probably be at least 100,000 yuan ($ 14,469, 90) per flight for each airline, Li is considered.

"The potential cost is also large. Slower growth in passenger volume across China's largest airports in March and April was largely due to the basis of 737 MAX jets, according to my calculations, Li said.

China's state property regulator set the number of 737 MAX jets operated by the three largest Chinese airlines at 53.

Outside of China, carriers who have requested compensation, Turkish Airlines, United Airlines, have Ryanair and Flydubai.


Last week, Bloomberg reported that major Chinese airlines considered collaborating to seek compensation. On Tuesday, the state newspaper People & # 39; s Daily said China Eastern had not communicated with the other carriers on the subject before making their request. China Eastern confirmed the contents of this report to Reuters.

On Wednesday, but generally read the tabloid Global Times reported that the action seemed to be a "concerted effort".

"China seems to be ready now to put more pressure on Boeing when the company happens to have a real security issue, and the trade friction between the US and China began to enter a downward spiral," quoted Global Times Shen Yuxin as saying. partner at the law firm Freshfields Bruckhaus Deringer, as said.

The latest compensation requests also come one day before the US Aviation Authority hosts global regulators in Dallas to review 737 MAX software and Boeing training proposals before regulators decide to cancel the priming.

FILE PHOTO: Air China's logo is seen on a counter by Air China at a terminal in Beijing Capital International Airport in Beijing, March 28, 2016. REUTERS / Kim Kyung-Hoon / Filfoto

China and European Union each have its own aviation industry, and it is likely that they will decide their own conditions to allow 737 MAX flights to continue, analysts say.

The International Aviation Association has also gathered a meeting with airlines with grounded 737 MAX jets on Thursday in Montreal.

($ 1 = 6.9109 Chinese yuan yuan)

Reporting of Stella Qiu and Brenda Goh; Editing Himani Sarkar and Christopher Cushing

Our Standards: Thomson Reuters Trust Principles.

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