Boeing has announced its plans to suspend the production its 737 Max aircraft starting in January as it waits approval for the plane to return to service.
Boeing plans to halt production of its 737 Max aircraft beginning January as it awaits re-certification from airline regulators globally.
As a result of reports on Boeing's decision to halt production of the plane, the company's stock price fell by over 4% at the market close and went down by another 0.67% after hours following the official announcement.
The Boeing 737 Max planes were grounded globally in March following two fatal crashes that killed 346 people; a Lion Air jet that went down into the Java Sea in October 2018 and an Ethiopian Airlines plane that crashed near Addis Ababa in March.
This has cost Boeing billions of dollars and the company is insisting on having the plane approved to fly again in the US by the end of the year and to start commercial service as soon as January.
Last week, US Federal Aviation Administration (FAA) administrator Stephen Dickson said that the FAA will prohibit the flying of the Boeing 737 Max airplane for the rest of 2019. Dickson said he could not tell yet when the plane will receive approval to fly again.
However, he mentioned that there are 10 or 11 different steps in the certification process that needs to be accomplished before it receives approval. He said: “If you do the math, it’s going to extend into 2020.”
Since its grounding, there were no orders for the 737 Max until last month that Boeing recorded its first new orders, a total of only 30 planes. Meanwhile, the company continued production of the planes in hopes for a quick re-certification.
In a news release on Monday, Boeing said: "We believe this decision is least disruptive to maintaining long-term production system and supply chain health."
