Boeing to suspend 737 MAX production starting in January

Cleveland, Ohio – Boeing officials announced late Monday that the company would temporarily suspend production on the 737 program beginning in January 2020, and instead prioritize delivery of the 400 MAX airplanes it has continued to produce since the fleet was grounded in March 2019.

Boeing reduced the 737 production rate from 52 to 42 planes per month in mid-April, while maintaining production team employment levels.

A Dec. 16, 2019 company press release stated, “We believe this decision is least disruptive to maintaining long-term production system and supply chain health. 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 prioritize 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.”

Last week, FAA Administrator Steve Dickson said he would not clear the plane to fly before 2020 and disclosed the agency has an ongoing investigation into 737 production issues in Renton, Washington. He added there are nearly a dozen milestones that must be completed before the MAX returns to service, possibly not until March or later.

Boeing officials reiterated, “The FAA and global regulatory authorities determine the timeline for certification and return to service. We remain fully committed to supporting this process.”

The company plans that affected employees will continue 737-related work, or be temporarily assigned to other teams in the area during the 737 MAX work suspension.

“We will keep our customers, employees, and supply chain top of mind as we continue to assess appropriate actions. This will include efforts to sustain the gains in production system and supply chain quality and health made over the last many months,” the company statement continued.

Announced in a separate news release, the Boeing board of directors approved a regular quarterly dividend of $2.055 per share, payable March 6, 2020, to shareholders of record as of Feb. 14, 2020.