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Indonesia airline seeks to cancel order for 49 Boeing 737 Max 8 planes

Indonesia airline seeks to cancel order for 49 Boeing 737 Max 8 planes
A Boeing 737 Max on the tarmac outside the company's factory in Renton, Wash. (Stephen Brashear / Getty Images)

In a blow to Boeing Co., Indonesia’s national airline is seeking the cancellation of a multibillion-dollar order for 49 of the manufacturer’s 737 Max 8 jets, citing a loss of confidence after two of those planes crashed in the last six months.

It is the first announcement of a cancellation since Boeing’s new-model aircraft were grounded following the fatal crashes in Indonesia and Ethiopia.

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Garuda Indonesia, which ordered 50 Max 8 jets in 2014 and received one of those planes last year, sent a letter to Boeing last week requesting to cancel the rest of the $4.9-billion order, airline spokesman Ikhsan Rosan said Friday. The carrier has so far paid Boeing about $26 million for the order.

Garuda joined other airlines worldwide in grounding its Max 8 jet after the crash of an Ethiopian Airlines flight this month that killed all 157 people aboard. It came less than five months after 189 people died in the Oct. 29 crash of another Max 8, operated by Indonesian private carrier Lion Air.

“Passengers always ask what type of plane they will fly as they have lost trust and confidence in the Max 8 jet,” Rosan said, adding that using the ordered planes “would harm our business.”

He said Garuda plans to meet with Boeing representatives next week in Jakarta to discuss details of canceling the order.

“We don’t want to use Max jets ... but maybe will consider switching it with another Boeing model of plane,” Rosan said. He said Indonesian passengers are afraid to take flights using any Max model, whether it's the 8, 9 or 10 series.

A preliminary report from Indonesia’s National Transportation Safety Committee in December stopped short of declaring a probable cause of the Oct. 29 crash.

Officials have provided scant details since then, saying they are still analyzing data from a cockpit voice recorder that was recovered from the sea in January.

Boeing stock fell 2.8% on Friday. The shares have sunk more than 14% since the March 10 crash in Ethiopia.

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