TOMORROWS TRANSPORTATION NEWS TODAY!

Tag: damages

American Airlines Reaches Settlement with Boeing for 737 MAX Compensation

(Reuters) – American Airlines Group Inc <AAL> said on Monday it had reached a confidential agreement with Boeing Co <BA> to address damages the airline incurred in 2019 due to the ongoing grounding of its fleet of Boeing 737 MAX aircraft.

American, the largest U.S. airline, said the compensation will be received over several years. The airline will use more than $30 million of the compensation for the airline’s 2019 employee profit-sharing program.

American said it does not expect any material financial impact of the agreement to be realized in its fourth-quarter 2019 earnings and it will continue talks regarding compensation for damages related to the MAX grounding beyond 2019.

The Association of Professional Flight Attendants, which represents American Airlines’ 28,000 flight attendants, said it welcomed the news about compensation, and was evaluating the details.

Boeing said it does not comment on discussions with airlines.

Boeing’s best-selling 737 MAX has been grounded since two fatal crashes in five months killed 346 people. The company is halting production this month. A number of airlines have struck confidential settlements with Boeing in recent weeks.

(Reporting by David Shepardson, Editing by Rosalba O’Brien)

An American Airlines Boeing 737 Max 8, on a flight from Miami to New York City, comes in for landing at LaGuardia Airport in New York

GM Sues Fiat Chrysler Claiming UAW Bribes Cost it Billions

General Motors filed a racketeering lawsuit Wednesday against Fiat Chrysler.

GM accused its smaller rival of making bribes over many years to corrupt the bargaining process with the United Auto Workers.

GM said it will seek “substantial damages” as part of the remedy. Although it did not specify an amount, it said the bribes cost it billions of dollars.

In the lawsuit, America’s biggest automaker accused Fiat Chrysler, under the leadership of now deceased CEO Sergio Marchionne, of bribing UAW officials into allowing it to pay lower wages than GM, use more temporary workers than GM and employ more lower-paid second-tier workers than GM.

Fiat Chrysler said in a statement it is “astonished by this filing, both its content and its timing” and said it assumes the lawsuit was intended to disrupt the labor negotiations tied to merger talks between it and Peugeot owner PSA.

Union officials from the UAW fired back in a separate statement, saying the fact these issues can cause doubts about the contract is “regrettable” and it stands by the terms previously negotiated with Fiat Chrysler.

The UAW has been the focus of a spreading federal corruption probe that recently forced its president to seek a leave of absence.

The lawsuit comes at a precarious time for Fiat Chrysler, not only is it in aforementioned merger talks – it is also in the midst of negotiating a four-year contract with the UAW.

GM said the lawsuit has nothing to do with the merger or the union and is solely focused on Fiat Chrysler.