Boeing (BOE, Washington National) is asking LAM - Linhas Aéreas de Moçambique (TM, Maputo) to pay USD4.5 million dollars in debt for allegedly missing payments on a parts supply contract, Portuguese agency Lusa reported after gaining insight into documentation. However, the carrier only admits to owing USD729,000 for late contract rents.

The US company sent an invoice on December 20, 2023, that includes an item that says LAM should reimburse it USD3,487,851 as it claims that over 30 parts or items were never returned from Mozambique or were returned late to Boeing.

However, sources at the state-owned Mozambican carrier claimed that they were not to blame for the delays but forwarding agents and customs provisions (which have since been amended to facilitate the process).

The dispute also got to the General Inspectorate of Mozambique’s Ministry of Transport and Communications where separate documents from January showed that Boeing said all items and equipment had been returned.

LAM has offered Boeing to pay its dues in phased payments, but Boeing refused the proposal. The disputed contract was signed in 2014. Meanwhile, LAM has credit of about USD23.5 million with Boeing from a separate contract from November 2013 which was supposed to help it acquire new jets and expand its operations. Nevertheless, Boeing is refusing to release these funds to LAM until the parts supply invoice is settled.

According to ch-aviation fleets data, three B737-7s were due to be delivered to LAM in 2015, 2016, and 2017 respectively, but were delayed due to the airline's financial constraints. LAM also held purchase rights for three additional B737NGs.

LAM has been undergoing revival attempts after the Mozambican government hired Fly Modern Ark to run the national carrier. According to data from late October, the company’s debt fell from around MZN25.28 billion meticais (USD400 million) to MZN18.33 billion (USD290 million).

ch-aviation has reached out to both LAM and Boeing for comment.