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Boeing cuts production of 737 Max jets to focus on fixing glitches

Boeing will produce only 42 737 Max aircraft in a month, as opposed to the earlier 52 planes. CEO Dennis Muilenburg said the production cut was temporary and in response to the suspension of deliveries.

twitter-logoBusinessToday.In | April 6, 2019 | Updated 17:51 IST
Boeing cuts production of 737 Max jets to focus on fixing glitches
Boeing has cut production rate of 737 Max aircraft to focus on fixing glitches in the aircraft.

Boeing has decided to cut the production rate of its 737 Max jets from this month. Reports suggest that only 42 Boeing 737 Max aircraft will be produced in a month, as opposed to the earlier 52 planes. The company will instead turn its attention to fixing the glitches in the flight-control software of the narrow body aircraft series which had led to two deadly crashes.

Boeing Chairman and CEO Dennis Muilenburg said the production cut was temporary and in response to the suspension of 737 Max deliveries. In a statement, he said the reduction was designed to keep a healthy production system and maintain current employment in effect, slowing down production now to avoid a deeper cut later, if fixing the plane takes longer than expected.

The decision to reduce production comes on the back of Boeing's announcement that a second software issue has emerged that needs fixing on the Max. This might impact the company's plan to get its grounded planes back in air and expand production. The American plane maker had hoped to expand production of its Max jets to 57 planes a month within this year.

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A company spokesperson called it a "relatively minor issue" and said a fix was already in the works. He said the latest issue is not part of flight-control software called MCAS that Boeing has been working to upgrade since the first crash.

The company has already suspended deliveries of the aircraft after regulators around the world grounded the 737 Max planes in fleets under their jurisdiction. So far, Boeing has delivered less than 400 Max planes but has more than 4,600 pending orders.

Analysts say the absence of deliveries will eat into Boeing's cash flow as the company gets most of the cost of a plane upon delivery. Airlines that operate the Max will be squeezed the longer the planes are grounded, particularly if the interruption extends into the peak summer travel season.

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Boeing 737 Max jets were grounded after two fatal crashes involving these planes operated by Indonesia-based Lion Air and Ethiopian Airlines. Preliminary investigation into the accidents revealed that faulty sensor readings erroneously triggered an anti-stall system that caused the planes to nosedive. Efforts by pilots to regain control of the automated system failed to check the descent of the aircraft.

Boeing has been facing financial troubles after its most popular aircraft series was grounded. The focus on fixing the glitches in the 737 Max aircraft could help Boeing get the jets back in operation. The company has been facing several lawsuits filed by families of the victims who died in the two crashes. A total of 346 people died in the two plane crashes.

Additionally, Boeing has also announced to set a special board committee to review airplane design and development.

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