Boeing fee dispute with Bedek Aviation Group finally settled

This was a long war and last week a “peace agreement” finally ended it. The peace negotiations were slow but by the standards of never ending peace talks in the Middle East, that was quite an achievement.

The “Boeing fee” dispute between the aircraft manufacturer and the Bedek group of Israel Aerospace Industries (IAI) has been settled.

The Bedek Aviation Group has signed licensing agreements with Boeing over modifications to the Boeing 767-200/300 and the 747-400, including passenger to freighter conversions.

The agreements apply to 72 Boeing 767-200/300 BDSF (Bedek Special Freighter) aircraft and 29 Boeing 747-400 BDSFs previously converted by IAI for various customers, as well as future IAI conversions.

Bedek Aviation Group has been a Boeing licensee for passenger-to-freighter conversions of the 737-300/400 since 2009.

The dispute began shortly after the first converted aircraft were delivered to clients. Boeing charged a special fee for every aircraft that  was converted by Bedek from passenger to cargo configurations.

Repeated efforts to reach understanding had, until now, failed.

The Boeing fee increased the final price of each conversion performed in Bedek hangars by $250,000-300,000 and was charged to allow the owner of the converted aircraft access to all the technical documentation of the aircraft.

According to Boeing the fee is a type of royalty, since the conversion changes the original airframe design.

The new agreement has established a mechanism that according to sources “satisfies both sides”.

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