Boeing will temporarily halt production of its new 737 MAX commercial jetliner in January, the aerospace manufacturer announced today.

There are no layoffs associated with the production cut, a person familiar with the decision said.

The production cut caps off a financially-disastrous year for Boeing's commercial airplanes division.

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The 737 MAX, Boeing's newest commercial jet, was grounded worldwide in March after a software problem played a role two deadly crashes in Indonesia and Ethiopia within five months of each other, killing 346 passengers and crew.

The company has been waiting for the Federal Aviation Administration to approve a software fix, but the approval timeline has been repeatedly pushed back.

"We believe this decision is least disruptive to maintaining long-term production system and supply chain health," the company's statement reads.

"This decision is driven by a number of factors, including the extension of certification into 2020, the uncertainty about the timing and conditions of return to service and global training approvals, and the importance of ensuring that we can prioritise the delivery of stored aircraft. We will continue to assess our progress towards return to service milestones and make determinations about resuming production and deliveries accordingly."

In this region Fiji Airways has two Max aircraft and has had to charter aircraft to cover for the grounded planes. Virgin Australia has 48 of the planes on order but earlier this year deferred delivery of the first of them to July 2021.

In July Boeing reported its biggest ever quarterly loss – US$2.94 billion – compared with a profit of US$2.2b in the same period last year.

Boeing's second-quarter revenue fell 35 per cent from US$24.5b in 2018 to US$15.7b.

The company took an after-tax charge of US$4.9b in the second quarter to compensate airlines affected by the grounding of its 737 Max.


The first 737 Max incident occurred on October 29, 2018, when Lion Air Flight 610 crashed into the Java Sea 13 minutes after takeoff, killing all 189 passengers and crew.

The second took place on March 10, 2019 when Ethiopian Airlines Flight 302 crashed just six minutes after takeoff, with all 157 people aboard lost.

Boeing's stock has fallen 23% since the March 10 crash.

- Additional reporting and AP