Boeing confirmed after its meeting with investors on Monday that it is planning to suspend 737 Max production early next year following the Federal Aviation Administration's (FAA) statement that the troubled jet's recertification will not come this year.
According to CNBC, the U.S. jet maker said in a statement that while it will temporarily shut down productions on the said model, the company will not lay off workers. There are around 12,000 employees at the Renton, Washington factory where the pause will be implemented.
Instead of furloughing workers, Boeing said it will reassign staff members to ensure that everyone can keep their jobs. Despite hope for the said workers, it is unclear when the American aircraft giant will resume production.
The decision to temporarily shut down production of the Boeing 737 Max came following the FAA's signal that it will continue reviewing the troubled planes until next year. The announcement added further uncertainty on the model's recertification, which is necessary to get the planes back in the air.
Boeing reiterated that it will "remain fully committed to supporting" the FAA and global regulators in their efforts to ensure that the 737 Max model will be safe for air service.
The news affected stocks on Monday's trading. Boeing shares slumped by over four percent, with some industry analysts noting that the recertification is a critical factor in keeping company shares on stable ground in global markets.
While the two 737 Max crashes that took 346 lives have been the center of backlash and reputational doubts, Boeing has also been dragged into the hot seat due to the losses that airlines flying the jet have experienced.
Ever since the planes were grounded in March, airlines have been unable to accept additional planes. While Boeing has inked deals with some airlines, rival Airbus has also been ramping efforts in snagging deals with some top global carriers.
Another Boeing plane that was dragged into the spotlight since the 737 Max tragedies were the 787 Dreamliner, following reports that the jet's lightning safety system may no longer be as durable as it was in the past.
There have also been reports stating that the world's largest jet maker kicked off productions of the 787 Dreamliner before the FAA pressed the green light on manufacturing the planes.
Some industry experts raised concerns about the FAA's role in ensuring that all Boeing jets were safe for flight. It appears that the FAA is stricter this time in reviewing the company's aircraft as some of the victims' families have called on the regulator to not recertify the planes anymore.
