Boeing is considering additional cutbacks to production of its controversial 737 MAX jet, according to sources who spoke with The Wall Street Journal. Southwest said the payout was based on projected reductions in the airline's 2019 operating income arising from service disruptions caused by the groundings.
The nation's top aviation regulator recently told Congress that Boeing's 737 Max would not fly again until he personally pilots the craft grounded for nine months after two deadly crashes.
Southwest officials said the money would be added to the company's employee profit-sharing fund.
The Wall Street Journal first reported Sunday that the company could possibly end production of the beleaguered fleet of jets, sending shares of Boeing to tumble almost 4% on Monday.
Boeing said it will continue P8 production of the military version of the 737.
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Boeing's board is discussing whether to cut back or suspend production of the 737 Max passenger jet, raising the possibility that the USA aircraft manufacturer will face another round of charges before regulators clear the plane to resume flying.
American regulators have said they will not be able to approve the jets' return to service before 2020. The timing of regulatory approval for the Max's return is uncertain, with Boeing's relationship with the U.S. Federal Aviation Administration in tatters after a rare public admonishment last week by the regulator.
Boeing stock dipped Monday amid reports that the company may pause production of its beleaguered 737 MAX plane.
Halting production will ease a severe squeeze on cash tied up in roughly 375 undelivered planes, but only at the risk of causing industrial problems when Boeing tries to return to normal, industry sources said. A further investigation into production problems with the plane in Renton, Washington is ongoing, Dickson revealed.
"I think that what we're really waiting to see is whether or not Boeing can get this issue resolved so that everyone feels safe and comfortable with the process", CBS Business Analyst Jill Schlesinger told Seattle's Morning News on KIRO Radio.