Boeing pledges $136m to help families of 737 MAX crashes

SEATTLE/CHICAGO • Boeing has said it would give US$100 million (S$136 million) over multiple years to local governments and non-profit organisations to help families and communities affected by the deadly crashes of its 737 MAX planes in Indonesia and Ethiopia.

The move on Wednesday appears to be a step towards repairing the image of the world's largest planemaker, which has been severely dented by the crash of an Ethiopian Airlines plane in March, just five months after a similar crash of a Lion Air flight in Indonesia.

The two crashes killed a total of 346 people.

Boeing is the target of a US Department of Justice criminal probe into the development of the 737 MAX, regulatory inquiries and more than 100 lawsuits by victims' families.

The multi-year payout is independent of the lawsuits and would have no impact on litigation, a Boeing spokesman said.

The US$100 million, which is less than the list price of a 737 MAX 8, is meant to help with education and living expenses and to spur economic development in affected communities, Boeing said. It did not specify which authorities or organisations would get the money.

Many of the passengers on board the doomed Ethiopian Airlines flight were aid workers or involved with health, food, or environmental programmes.

"If the money is spent on furthering the work of the people on that airplane, it would be money well spent," said Mr Justin Green, a New York-based attorney representing the families of several of the Ethiopia crash victims.

But he said the fund would not affect his clients' courtroom strategy: "What families really want to know is why this happened. Could this have been avoided?"

Mr Anton Sahadi, a representative of relatives of the Lion Air crash victims, said the families appreciated the US$100 million fund, but it did not mean they would stop their lawsuits. "We will continue to fight for our rights in the courts," he said, adding: "Boeing is doing this to build their image back."

After the Lion Air crash on Oct 29 last year, Boeing started developing a software fix on a stall-prevention system called MCAS, believed to have played a role in that disaster, as well as in the Ethiopian crash.

The 737 MAX was grounded worldwide after the second crash and regulators must approve the fix and new pilot training before the jets can fly again.

But just last month, regulators identified a new problem that will delay commercial flight for the jets until October at the earliest.

Boeing is in settlement talks over the Lion Air litigation and has separately offered to negotiate with families of Ethiopian Airlines victims, but some families have said they are not ready to settle, exposing Boeing to a lengthy court battle.

"The Boeing brand is worth far more than US$100 million and the board and executive leadership understand that is what is at stake," said Columbia Business School professor William Klepper.

REUTERS

A version of this article appeared in the print edition of The Straits Times on July 05, 2019, with the headline 'Boeing pledges $136m to help families of 737 MAX crashes'. Print Edition | Subscribe