With the return to service of the Boeing 737 MAX now postponed to 2020, Boeing has continued to build new airplanes and there are now approximately 400 airplanes of the troubled 737 MAX in storage. As a result of ongoing evaluations, Boeing has decided to prioritize the delivery of stored aircraft and temporarily suspend production on the 737 program beginning January 2020. Boeing stated that no layoffs or furlough are expected at this time. The 737 MAX has been grounded since March following two fatal crashes involving the jet.
It is estimated that since the jet’s grounding, the American aerospace giant has lost over US$8 billion in charges and a suspension in production would be likely to result in substantial additional charges. Currently Boeing’s suppliers have not been affected by the grounding of the 737 MAX as Boeing has continued production, albeit at a reduced rate of 42 jets per month, while most suppliers have continued to supply parts to match a rate of 52 jets a month.
