Boeing faces first cancellation of 737 Max jets

By BoeingFOXBusiness

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Indonesia’s flag airline is cancelling its orders for the Boeing Max 737 jet, the first carrier to publicly do so after the aircraft was involved in two crashes in less than five months.

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Garuda Indonesia informed Boeing on March 14 that it wished to cancel its remaining order for 49 Max jets. The two sides plan to meet on March 28 for “further discussion,” according to the Wall Street Journal.

A Boeing spokeswoman declined to comment.

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A Max jet flown by rival Indonesian airline Lion Air crashed in October shortly after taking off, killing the 189 people on board. Investigators have cited a faulty “point of attack” sensor as the reason for the crash, which tracks incline at takeoff to prevent stalling.

U.S. regulators have not drawn a direct link between that incident and one earlier this month -- where a Max jet flow by Ethiopian Airlines crashed, killing 157 people – but previously said there were similarities.

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Boeing is expected to soon release a software update to fix the stall-prevention system. The Federal Aviation Administration called the review of the update an “agency priority.”

The Chicago-based manufacturer has over 5,000 orders for the 737 Max jet – which is an update to its most popular aircraft. To-date, Boeing has delivered 376 planes, including one of the 50 total ordered by Garuda.

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Analysts and economists have warned of the impact to both Boeing and the U.S. economy should there be a wide-scale cancellation of orders.