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caption: The Boeing Renton Factory is shown on Tuesday, August 18, 2020, in Renton.
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The Boeing Renton Factory is shown on Tuesday, August 18, 2020, in Renton.
Credit: KUOW Photo/Megan Farmer

Boeing to pay $2.5 billion for 737 MAX conspiracy charge

In a settlement announcement, the Department of Justice said two employees "chose the path of profit over candor."

Investigators found that Boeing employees concealed software problems related to the 737 MAX. The problems surfaced following two fatal crashes in 2018 and 2019.

Scott Hamilton, aviation analyst at Leeham Company, says this does not mean Boeing’s legal problems are now behind the company.

“This settlement will be a godsend, if you will, for the liability plaintiff lawyers.”

Under the settlement, Boeing will pay more than $1.7 billion to airline customers; $500 million will be established for a crash victims’ fund. The rest is criminal fines.

In a statement, Boeing CEO David Calhoun says the resolution is the right thing to do, “and a step that appropriately acknowledges how we fell short of our values and expectations.”

Moving forward, analysts say the company really needs to focus on changing its culture.

Richard Aboulafia of Teal Group says Boeing has strayed from its real focus: building planes.

“You got this company that should be about engineering and technology,” he said. “Instead, it’s migrated over to financial abstractions and investor relations.”

Aboulafia says the company needs more top management with technical expertise.

Hamilton says Boeing likes to promote the two retired Navy admirals on its board.

“That’s all well and good, but that’s not airplane safety; that’s submarine safety.”