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Parked 737 Max planes.
OUTREACH FUND

Boeing is dedicating $100 million to families and communities affected by the 737 Max crashes

By Abdi Latif Dahir

Boeing has set aside $100 million to support the families of victims of its troubled 737 Max aircraft, which experienced two crashes in under six months that killed 346 people.

The funds will support “education, hardship and living expenses” for families, along with economic development in affected communities, the company said in a statement on Wednesday (July 3). Boeing CEO Dennis Muilenburg described the fund as “initial outreach,” noting they were focused on regaining the “trust and confidence from our customers and the flying public in the months ahead.”

The financial offer comes as the plane manufacturer faces its greatest challenge and increasing scrutiny to explain what went wrong with its best-selling 737 Max aircraft. Last October, a Lion Air aircraft plunged into the sea less than 15 minutes after taking off from Jakarta, killing all 189 people on board. Then in March, a Nairobi-bound Ethiopian Airlines flight crashed six minutes after departing Addis Ababa, killing all 157 people.

Both crashes have so far been linked to bad sensor data triggering an automated anti-stall system called the Maneuvering Characteristics Augmentation System (MCAS) which directs the plane sharply downward.

Governments and aviation regulators grounded the 737 Max all across the world, with families, investors, and pilots all filing lawsuits against Boeing. Analysts say settling all these cases could be the largest non-war aviation reinsurance claim on record, and could run up to at least $1 billion according to a Bloomberg Intelligence estimate. Legal experts say the price could even be higher, especially if plaintiffs can prove willful disregard for safety.

“This could be an attempt by Boeing to demonstrate an attitude of repentance, with a view to minimizing the ultimate awards of punitive damages that I expect will be made against them,” says Joseph Wheeler, an aviation attorney whose firm is representing 400 737 Max pilots in a class-action suit against Boeing.

Meanwhile, Boeing is still working on a software patch to update its 737 Max software. In late June, the US Federal Aviation Administration identified an additional fix which the company said it would undertake, making the return of the 737 Max to the skies unlikely anytime soon.