Boeing 737 Max update: More trouble for US aircraft manufacturer as it halts deliveries while assembly continues

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Published: March 15, 2019 12:30:15 PM

Norwegian Air Shuttle ASA, the biggest European operator of the Boeing 737 Max, said it would ask Boeing to cover the costs of the plane’s grounding.

Boeing has temporarily halted deliveries of the jetliner because of restrictions imposed by the U.S. Federal Aviation Administration.

More troublesome signs emerged for Boeing Co.’s 737 Max as the U.S. appeared likely to keep the jet on ground into April and satellite data suggested a link between the March 10 Ethiopian Airlines crash and an Indonesian disaster in October.

Meanwhile, the aircraft’s order book looked increasingly shaky as Garuda Indonesia said it would slash its purchase and French President Emmanuel Macron got set to hawk competing Airbus SE jets on a trip to China.

Key Developments:

Boeing said it has paused deliveries of the jetliner The Max appears likely to remain grounded in the U.S. through April Indonesian flag carrier Garuda trimmed its Max orders France prepared to decode the flight data and voice recorders

Here are the latest developments:

Boeing Pauses Deliveries

Boeing has temporarily halted deliveries of the jetliner because of restrictions imposed by the U.S. Federal Aviation Administration. “We continue to build the 737 Max while we’re assessing how the situation — including any potential capacity constraints — will impact our production,” Chaz Bickers, a spokesman for the company, said in an interview.

Grounding Seen Lasting Until April

The jets could remain grounded in the U.S. at least through April, lawmakers said after getting briefed by aviation regulators. Flights won’t resume until the planes receive updated flight-control software that Boeing and the U.S. Federal Aviation Administration are racing to finalize, according to two congressmen. That process could last for six weeks or more depending on additional training needed for pilots.

Flight Data Recorder

The first photo of the Ethiopian Airlines flight data recorder showed external damage from the impact of Sunday’s crash. Technical work on the boxes will begin Friday after coordination meetings got underway, France’s BEA said on Twitter.


Fares Surge

Average airfares in India soared 65 percent on major routes after the grounding of the 737 Max, shrinking capacity in the world’s fastest-growing aviation market. Carriers have previously been luring first-time flyers with ultra-cheap fares.

‘Cautionary Note’

President Donald Trump said he hopes the grounding of Boeing Co.’s 737 Max family of passenger jets is only temporary but the U.S. had to take a “cautionary route” after the plane was involved in two fatal crashes.

Garuda Trims Orders

Garuda Indonesia plans to further reduce its orders for 737 Max jets further after Sunday’s Ethiopian Airlines crash on Sunday. The Indonesian flag carrier initially planned to slash its Boeing 737 Max orders to 20 planes from 49 outstanding before the October disaster involving Lion Air flight 610. Now it plans to cut even more, President Director I Gusti Ngurah Askhara Danadiputra, told reporters in Jakarta.

Indonesia Sends Team

Indonesia will send two officials to Addis Ababa to observe the ET302 investigation, NTSC Chairman Soerjanto Tjahjono says in a telephone interview. The agency hasn’t received any report from Indonesian carriers of any malfunction with Boeing 737 Max jets since the crash of Lion Air flight 610.

France Receives Black Boxes

The voice and data recorders from the crashed Ethiopian Airlines Boeing 737 Max have arrived in France, a spokesman for the French BEA air-accident investigation office said. The BEA couldn’t say how long it will take to read the data; agency will analyze it if Ethiopia asks.

Airbus China Talks

Xi Jinping will discuss a major order of Airbus planes with his French counterpart, Emmanuel Macron, when the Chinese president visits Paris this month, a French official said Thursday. There are “positive signals” regarding the contract, the official said. Snatching a deal would be a boost for Airbus in a country that’s become a battleground with Boeing for orders. Macron and Ethiopian Prime Minister Abiy Ahmed are also discussing a new contract as part of a fleet renewal at Ethiopian Airlines, the official said.

Boeing Woes Spread to BOC

Aircraft leasing company BOC Aviation fell 4.2 percent in early Hong Kong trading after CICC cut the stock to hold on uncertainty caused by the grounding of the Max. The plane accounts for nearly half the company’s undelivered aircraft.

Korea on Hold

Korean Air, scheduled to operate 737 Max 8 flights from May, said it won’t fly the aircraft until its safety is guaranteed.

U.S. Carriers Fill Gaps

U.S. carriers moved swiftly to comply with federal orders grounding their Boeing 737 Max aircraft and shift passengers to other flights. The Max makes up about 3 percent of the mainline fleets for three U.S. carriers: American Airlines Group Inc., Southwest Airlines Co. and United Continental Holdings Inc.

U.S. Grounds the Max

The U.S. Federal Aviation Administration reversed course and grounded the 737 Max. Boeing said it supported the decision and would recommend grounding the entire global fleet of 371 737 Max aircraft.

Boeing Customers Waver

VietJet Aviation JSC, which doubled an order for the 737 Max to about $25 billion only last month, now said it sould decide its plans once the cause of the deadly accident has been found. Kenya Airways Plc is also reviewing proposals to buy the Max and could switch to Airbus SE’s rival A320. Russia’s Utair Aviation PJSC is seeking guarantees before taking delivery of the first of 30 planes. Indonesia’s Lion Air was already looking at scrapping its Boeing deal after October’s crash.

Norwegian Wants Compensation

Norwegian Air Shuttle ASA, the biggest European operator of the Boeing 737 Max, said it would ask Boeing to cover the costs of the plane’s grounding. DNB analysts estimated a potential cost of between 5 million kroner ($580,000) and 15 million kroner a day for Norwegian.

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