Boeing has had a disastrous past nine months or so as two of its 737 Max jets were involved in deadly crashes in October and March that killed 346 people. The company has been hugely criticized for rushing up the development and manufacturing process of the model that was involved in both crashes. Boeing also failed to fully disclose likely problems with MCAS flight control software for its 77 Max model. The same software is considered to be the primary cause behind both crashes that occurred in Indonesia and Ethiopia. However, the official cause of the crash is yet to be notified.
As expected, Boeing saw a sharp decline in its share price as investors started doubting the going concern of the company amid fear of large-scale lawsuits by families of the victims and potentially large outflow of money because of these lawsuits.
The company continued to face massive backlash in spite of the passing of three months of the latest of the two incidents. As a measure to earn goodwill, Boeing recently announced to set aside $100 million in order to assist communities and victims’ families that were affected by the accident. These funds are separate from any compensation the company may have to pay in the future as a result of families suing the company. These funds will be available over the next few years.
While announcing the fund, the Boeing CEO Dennis Muilenburg apologized for “the tragic loss of lives” and went on to acknowledge that “these lives lost will continue to weigh heavily on our hearts…..for years to come”. He also added that the company aims at re-earning confidence and trust from the flying public as well as the customers.
Families who take money from this fund will not have to waive rights to sue the company, the company confirmed in a statement.
Few days after the second 737 Max crash accident occurred in Ethiopia, the United States Federal Aviation Administration (FAA) and various other aviation regulators throughout the world grounded the same model of Boeing until the defects could be found and fully fixed. It has been over three months that the plane is grounded. Boeing will have to prove the model to be safe for commercial flights in order for the aircraft to be able to fly commercially once again.
As per company spokesperson, it may take up to September to resolve the issues with the aircraft and to make it available for commercial flights once again.