Boeing to halt production of 737 Max airliner in January

The decision confirmed investor fears that the company's recovery from the crisis is dragging on longer and creating more uncertainty for Boeing than executives anticipated.

Published: 17th December 2019 10:27 AM  |   Last Updated: 18th December 2019 08:46 AM   |  A+A-

A Boeing 737 MAX takes off during a flight test

A Boeing 737 MAX takes off during a flight test (File | Reuters)

Express News Service

NEW DELHI: Struggling  to get approval from regulators worldwide, aircraft manufacturer Boeing has announced temporary suspension of production of its 737 Max jet. The announcement will also delay the plane-maker’s earlier deadline to get the controversial yet important aircraft back into service in the first quarter of CY2020.

In India, the suspension is likely to impact the expansion plans and balance sheet of private carrier SpiceJet; besides giving rival manufactures Airbus, which recently struck multi- billion dollar deal with Indi- Go, an edge in one of the fastest growing aviation markets in the world.

Boeing recently estimated that India would need around 2,400 aircraft in next 20 years. “SpiceJet has aggressive domestic and international expansion plans.

The impact of 737 Max grounding was already seen in the company’s Q2 results. In all likelihood, the carrier won’t be able to compensate the demand-supply mismatch and bring down its expense cost with older aircraft in the near future,” said an aviation analyst, who wished anonymity.

The Ajay Singh-controlled airline had firmed up orders for 205 new planes from Boeing with 155 of them being 737 Maxs.

Singh had recently hinted that he is in talks with Boeing to buy more 737 Max aircraft. “However, the fresh update might force the fast growing airline to look for other options,” the analyst said.

The airline has 13 of these Max planes — all of them grounded in March after two fatal crashes that killed 346 people on board. SpiceJet said Boeing suspending production of the aircraft does not impact its current operations in any manner.

“We are presently working with Boeing Company on the return to service and is in accordance with the guidance provided by the Boeing Company,” said a SpiceJet spokesperson.

When the airline posted a net loss of Rs 462.6 crore in the second quarter, Singh had said that “the continued grounding of 737 Max has hit our growth plans adversely and resulted in inefficient operations and as a result, increase in costs”. He added that the return of 737 Max early next year will provide a huge boost to operations, which now looks unlikely.


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