Boeing Gives Alaska Airlines $160 Million in Cash

(UnitedHeadlines.com) – Boeing paid Alaska Airlines an “initial compensation” of about $160 million to help “address the financial damages” suffered after Alaska Airlines Flight 1282 suffered a midair blowout on Jan 5.

The door plug failure on a 737-9 MAX plane happened when Alaska Airlines Flight 1282 reached 16,000 feet after taking off from Portland, Oregon. The failure allowed the cabin to depressurize, leaving a hole in the aircraft that resulted in a child’s shirt tearing off his body and cell phones getting sucked out of the plane, with the door plug landing in the backyard of a high school science teacher.

National Transportation Safety Board Chair Jennifer Homendy said that while there were 171 passengers and six crew members onboard the aircraft, nobody was seated where the door plug is, in seats 26A and 26B.

Thousands of flights were canceled after the Jan. 5 midair blowout as similar Boeing 737 Max 9 jetliners were grounded by the Federal Aviation Administration, who conducted inspections. The groundings affected Alaska Airlines and United Airlines, with the FAA stating that this “cannot happen again.”

The incident remains under investigation by the Department of Justice, which is investigating if the blowout violated the terms of a 2021 settlement regarding Boeing allegedly misleading regulators that certified the Max jets for flights.

The money will be used to address “financial damages incurred” due to the incident and the resulting groundings, according to an SEC filing. According to Alaska Airlines, it lost $160 million in the first quarter. According to the SEC filing, the cash compensation is “equivalent” to the amount of money Alaska Airlines lost following the midair blowout.

In the future, Boeing is “expected” to provide Alaska Airlines with “additional compensation.” However, the exact amount is unknown.

The initial compensation comes as Boeing aircraft continue to have problems. The latest was on April 7 when an engine cover fell off a Boeing 737-800 plane, striking the Southwest Airlines plane’s wing flap, causing the Houston-bound aircraft to head back to Denver International Airport.