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The coronavirus pandemic is expected to delay the return of Boeing Co.'s 737 MAX until at least late summer or early fall, people briefed on the matter said, adding to the plane maker's mounting financial strain.
The troubled jet isn't likely to win Federal Aviation Administration approval to fly again until August or later, a sign Boeing's anticipated midyear target is likely to slip, according to these people.
The FAA hasn't signed off on details of two outstanding software fixes to flight-control systems because agency experts are still reviewing them, according to one U.S. government official, and the contagion has slowed other parts of the effort.
Regulators' work to approve the jets for passenger service has been hampered by stay-at-home orders covering employees, while travel restrictions have created a formidable stumbling block for needed flight tests involving foreign pilots and the FAA's plans to brief international regulators, some of the people briefed on the matter said.
Boeing Chief Executive David Calhoun is expected to address the challenges posed by the pandemic next week when the company's shareholders meet and the company on Wednesday reports first-quarter earnings.
Mr. Calhoun has previously said regulators were making progress in recertifying the MAX despite working virtually, telling CNBC on March 24, "We're very close to the finish line." A Boeing spokesman said this week the MAX's return could face delays depending on how long the coronavirus crisis lasts.
The MAX's delivery challenges would deprive the company of much-needed cash from airlines willing to accept planes and pay for them. Boeing has sought federal stimulus aid and is mulling production cuts and layoffs. It recently suspended its dividend and drew down a $13.8 billion loan.
Airlines are no longer clamoring for the fuel-efficient, single-aisle planes now that global air travel has collapsed because of the pandemic. The plane maker's agreements with customers generally allow them to walk away without penalty if deliveries are delayed a year, people familiar with the arrangements said.
The provision could leave Boeing with diminished leverage as airlines haggle with the manufacturer over deferring or canceling their orders for planes they suddenly don't need or can't afford. Boeing has already suffered more than 400 MAX cancellations. It halted MAX deliveries in March 2019.
In January, Boeing signaled it expected the FAA would clear the MAX to fly again by July. Now the pandemic has left much of the final engineering work and reviews in limbo. Dates for formal certification flights haven't yet been set, according to some of the people briefed on the matter. Nor is there a schedule for mandatory test flights by a group of international airline pilots to establish training requirements.
Regulators grounded the MAX in March 2019 following two crashes linked to a faulty flight-control system that took a total of 346 lives.
The FAA has said it doesn't have a firm timetable for allowing the MAX to carry passengers and won't act unless Boeing complies with all certification requirements. Related safety issues must be resolved to the agency's satisfaction.
The pandemic is posing a host of logistical hurdles. Travel restrictions may prevent or delay foreign aviators from coming to the U.S. to participate in flight or simulator tests. With most FAA employees working remotely, agency engineers and inspectors are still trying to decide how they will verify maintenance checks and determine whether all systems are operating properly before clearing individual planes to fly passengers.