Boeing has been hit hard by the problems with the 737 airplane. The jets have been grounded worldwide since this spring after two fatal crashes—one last October in Indonesia, and another in Ethiopia in March. These crashes killed 346 people and raised serious questions about the plane’s features.
Now, Boeing is facing cancellation of a lucrative contract to sell 20 Max 737s to a Saudi Arabian airline, signaling that the company’s troubles are far from over.
Boeing announced on Sunday that Flyadeal, a subsidiary of state-owned Saudi Arabian Airlines, canceled a provisional order for 20 of its Max 737 jets over concerns about Boeing’s ability to deliver the planes in timely fashion. “We understand that flyadeal will not finalize its commitment to the 737 MAX at this time given the airline’s schedule requirements,” a Boeing spokesperson said, according to Reuters.
This was supposed to be a lucrative deal for company gaining billions of dollars. The list price for the 20 Max 737s, each of which costs about $117 million, would normally run $5.9 billion, though Flyadeal would have gotten an undisclosed discount.
Airbus is looking to gain from Boeing’s loss. The budget Saudi airline is going instead with the Airbus 320. Flyadeal announced in a statement today that it will run an all-Airbus 320 fleet in the future and expects to add 30 such jets to its current collection by 2021, Reuters states.
Boeing is trying to pick up the pieces after a disastrous year. Last week, the company announced that it would pay out $100 million to a fund for families of victims of the crashes, separate from any lawsuits over the matter. The fund would to support “education, hardship and living expenses for impacted families, community programs, and economic development in impacted communities,” according to a statement by Boeing CEO Dennis Muilenberg. He apologized to the victims’ families, saying, “We at Boeing are sorry for the tragic loss of lives in both of these accidents and these lives lost will continue to weigh heavily on our hearts and on our minds for years to come.”