Two Chinese Airlines Join China Eastern Airlines‘ Compensation Claim Against Boeing

Boeing 737 Max
A 737 Max aircraft is pictured at the Boeing factory in Renton, Washington, U.S., March 27, 2019. (Photo: REUTERS/Lindsey Wasson/File Photo)

China Eastern Airlines legally asked compensation from Boeing Co for the grounding of its 14 737 MAX aircraft and the delayed delivery of airplanes they ordered since March. Two state-run airlines joined the company's battle against the American multinational corporation.

According to the paper submitted by China Eastern Airlines, the grounding of 737 MAX aircraft since March 11, 2019, has caused relatively big losses to China Eastern and with the passing of time, related losses will further expand. It was also claimed that delayed deliveries of planes ordered by China Eastern also caused economic losses.

According to the People's Daily, a Chinese state-run news agency, China Eastern halted the flight of its 14 Boeing 737 MAX jets in its fleet including the planes in its subsidiary Shanghai Airlines. The report said that the aircraft has been mothballed according to aircraft maintenance standards. Boeing and China Eastern Airlines failed to discuss details of the compensation case.

On Thursday, the United States Federal Aviation Administration will hold global regulators meeting in Dallas to access the software and training proposals from Boeing before they could decide to give the go signal that will end the two-month grounding of the Boeing planes.

According to analysts, 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.

China is the first nation to stop the commercial operations of all Boeing 737 Max 8 airplanes following a plane crash of an Ethiopian Airlines on March 10. The Boeing 737 Max is also involved in another plane crash involving Indonesia's Lion Air on October 20. The events triggered the global scrutiny and bans on the operations of the Boeing 737 MAX planes.

Two other airline companies, Air China Ltd and China Southern Airlines Co., want to team up with China Eastern Airlines in its claim for compensation. The three biggest airlines in China are planning a coordinated legal claim to seek compensation for the delay caused by the grounding of the 737 Max.

The Civil Aviation Administration of China said that the three state-run carriers are potentially a formidable force to contend with. The data from VariFlight, a local aviation statistics company, showed that the three companies operate 53 of the 96 Max planes currently grounded in China. The Civil Aviation Administration of China said that the carriers accounted for percent of passengers who flew Chinese airlines last year. Analysts believe that a coordinated approach could give the airlines more leverage to concessions as China's influence in the aviation world keeps rising.

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