GOL Airlines saved by $420M Boeing 737 MAX compensation
Hardly anyone could foresee that Boeing’s saga with the worldwide grounding of 737 MAX would ever go in favor of customers who had placed orders for these planes.
Brazil’s largest low-cost carrier GOL Airlines has entered an agreement with Boeing to get 2,4 billion reais – an equivalent of $412 million – of compensation for the grounding of 737 MAX.
The compensation from the manufacturer could not have come at a better time for the airline grappling with coronavirus pandemic effects. As many carriers across the globe, GOL Airlines halted operations in April, following coronavirus restriction and travel bans. In financial results posted on May 4, 2020, Brazil’s major domestic carrier shared a loss of $419 million in the first quarter.
The airline specified on May 13, 2020, that the payment will come in credits and cash, and the amount of around $85 million in cash has already been received.
Up until recently, GOL Airlines did not plan to cancel Boeing orders. A devoted Boeing 737 operator, the airline had placed an order for 60 MAXs back in 2000 and has since upscaled it to 135 aircraft.
Even two deadly crashes and a worldwide grounding of Boeing’s latest addition to the jetliner family did not change its management’s belief that the 737 MAX is the most suitable aircraft for the Brazilian market.
“We will not cancel our orders. The 737 MAX is probably the best airplane ever made”, said CEO Paulo Kakinoff back in April 2019. The carrier was hoping that the model would make up half of its fleet by 2025.
In March 2020, however, the Boeing backlog indicated that GOL Airlines was among airlines reconsidering their purchase plans. The airline cut its order by 39 planes. By now, GOL Airlines has taken delivery of seven 737 MAX aircraft, all of them grounded after Ethiopian Airlines crash in March 2019.
GOL Airlines operates an all Boeing fleet, of 115 Boeing 737 and seven 737 MAX aircraft, according to the official airline’s website.
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