American Airlines will share $30 million portion of Boeing settlement with employees, thanks to the drama surrounding the grounded 737 Max

American Airlines will share $30 million portion of Boeing settlement with employees, thanks to the drama surrounding the grounded 737 Max
Boeing 737 MAX 8 American Air Laguardia New York
  • American Airlines on Monday said it's reached a deal with Boeing for compensation to make up for the grounded 737 Max plane.
  • The airline said it would share $30 million of the payout with employees, which should be distributed in March.
  • American was one of the airlines hardest hit by the grounding, with 24 of the jets in its fleet.
  • Visit Business Insider's homepage for more details.

American Airlines said Monday that it's reached a compensation deal with Boeing related to the 737 Max plane that's been grounded for nearly a year.


The Dallas-based carrier will add $30 million from the confidential agreement with Boeing into its profit-sharing program for the year 2019. Those payments should be distributed to the airlines' more than 100,000 employees in March, it said.

"Despite the ongoing challenges the grounding has brought, American Airlines team members continue to do an incredible job caring for our customers," Doug Parker, American's chief executive, said in a press release.

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American was one of the carriers hardest hit by the grounding of the plane worldwide following two deadly crashes involving Lion Air and Ethiopian Airlines. American has 24 of the jets in its fleet. Last year, American said it expected a roughly $540 million hit from the grounding.

Only Southwest, which recently inked a similar deal with Boeing as recuperation for lost profits last month, has more in its fleet.


Shares of American Airlines rose slightly, about 0.4% in after-hours trading Monday following the announcement.

There's still no word on when the 737 Max could return to the skies, as Boeing works with federal regulators for approval. Meanwhile, American has taken the plane out of its planned schedules until April at the earliest - a schedule that keeps moving backward.

"Our ability as an airline to weather these unprecedented times is thanks to our phenomenal team, and it was important to us that we get a deal done before the end of the year," Parker said.

"On behalf of the Board of Directors, we are proud to take the step of including this compensation in our 2019 profit-sharing program, even though the compensation will be received over several years."

Get the latest Boeing stock price here.