Alaska Airlines received $160 million from Boeing as initial compensation for lost profits due to a door blowout on a 737 Max 9 in January. The terms of future compensation from Boeing have not been disclosed, but Alaska is expecting more. The carrier also reported lost bookings during the first quarter due to the subsequent grounding of the Max 9, leading to a larger loss than previously forecasted.
The blowout incident and Max 9 grounding impacted Alaska’s first-quarter pre-tax profit, which would have otherwise improved by 80% compared to the previous year. The $160 million from Boeing will be excluded from Alaska’s first-quarter forecast. Alaska CEO Ben Minicucci has been vocal about holding Boeing accountable for the blowout and subsequent losses, with expectations of full compensation for the first-quarter loss.
The blowout incident led to the cancellation of thousands of flights by Alaska and United Airlines, the two U.S. carriers operating the Max 9. Alaska CEO Ben Minicucci expressed anger towards Boeing and joined other airline executives in lobbying for a change in leadership at the company. The FAA halted production expansion of the 737 Max following the incident, and Boeing has committed to strengthening its quality control processes.
The ST200 index tracks the performance of airline sector stocks, including network carriers, low-cost carriers, and related companies. The index provides an overview of the financial performance of nearly 200 travel companies valued at over a trillion dollars in global markets. The Skift Travel 200 combines various travel sector companies into a single number to analyze industry trends and financial performance.
Alaska Airlines anticipates receiving more compensation from Boeing beyond the initial $160 million payment for losses related to the 737 Max 9 blowout incident. The carrier reported a larger first-quarter loss due to lost bookings and the grounding of the Max 9, impacting pre-tax profit compared to the previous year. Alaska’s CEO and CFO have been vocal about holding Boeing accountable and expect full compensation for the first-quarter loss.
The blowout incident led to significant flight cancellations by Alaska and United Airlines, resulting in financial losses for both carriers. Alaska’s CEO has criticized Boeing and advocated for changes within the company, while the FAA halted production expansion of the 737 Max and Boeing committed to improving quality control processes. The ST200 index provides an overview of the performance of airline sector stocks within a global market context, offering insight into industry trends and financial performance.
