Tui strikes compensation deal with Boeing after grounding of 737 Max planes
Holiday giant Tui has reached a compensation deal with aircraft maker Boeing, which includes the slower delivery of its grounded 737 Max planes.
The UK’s biggest tour operator said in a statement on Wednesday that the agreement will offset the financial impact of the grounding of the plane, with Boeing to pay a “significant portion” in compensation.
While details of the deal remain confidential, Tui said Boeing will also provide it with credits for future aircraft orders, with fewer planned deliveries of the 737 Max planes in the next two years.
This enables Tui to rapidly adapt its fleet growth to the currently challenging market environment.
Tui said this will significantly reduce its capital and financing requirements for aircraft in the coming years, enabling the company to reduce the size of its fleet in the wake of the pandemic.
Fritz Joussen, chief executive of Tui Group, said: “The new delivery schedule gives us considerable flexibility because we will have fewer new aircraft delivered in the next years.
“This enables Tui to rapidly adapt its fleet growth to the currently challenging market environment.”
The tour operator was beset with financial troubles in the past year partly due to the grounding of the plane as well as the coronavirus pandemic, posting losses of 845.8 million euro (£747m) in the first half of 2020, compared to 289.1 million euro (£255m) in the same period 12 months previously.
Last month, the tour operator said it is looking to cut up to 8,000 roles worldwide, after describing Covid-19 as the “greatest crisis” the industry has faced.
The 737 Max plane was grounded in March 2019 after two crashes killed 346 people.