Dow lower after Boeing reveals production cut

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Transportation Minister Budi Karya Sumadi has said the government will wait for clarification from the United States Federal Aviation Administration (FAA) before making any further decisions on the grounded Boeing 737 Max 8 aircraft, following an Ethiopian Airlines crash in early March.

A crash of an Ethiopian Airlines-manned Max in March - just five months after a Lion Air jet of the same type went down - has put the planemaker at the center of a political, legal and increasingly financial firestorm where its reputation for safety is being openly questioned.

Boeing said on Friday production of its best-selling plane will be cut to 42 airplanes per month from 52 starting in mid-April. Never the less, the US-based low-priced carrier maker with a market capitalization of 101.1 billion did not reveal an end-date.

Similarly, Jefferies now expects Boeing to ship 497 737 Max aircraft, down from 580 units it projected previously.

Families of 11 Lion Air victims said at a news conference organized by Jakarta law firm Kailimang & Ponto that they are joining dozens of other Indonesian families in filing lawsuits against Boeing. As a result, the attorney said hundreds of people were killed in two crashes that were not even six months apart. Although the Boeing story will be "volatile" in next few months, the company should do well in time, it said.

Boeing, one of the world's largest aircraft manufacturers, has seen its reputation take a hit after one of its 737 Max jets crashed in Ethiopia, killing all 157 passengers and crew on board.

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Boeing said it is maintaining the same employment base while refocusing resources on efforts that will allow the global fleet of 737 Max planes to return to flight.

Boeing is expected to submit the software update to the FAA in the coming weeks.

Preliminary investigations into the deadly accidents in Ethiopia and Indonesia found that faulty sensor readings erroneously triggered an anti-stall system that pushed down the plane's nose. Currently, the Boeing Company is still working on a software update.

"The history of our industry shows most accidents are caused by a chain of events". As pilots have told us, erroneous activation of the MCAS function can add to what is already a high workload environment. What we do know, however, is that airlines are losing nearly $60 million a day because of the 737 MAX grounding.

Boeing stock is a component of the benchmark index.