Saudi airline flyadeal won't continue with Boeing 737 MAX order

Saudi airline flyadeal picks Airbus jets over grounded Boeing MAX

Faury attends a news conference at the 53rd International Paris Air Show at Le Bourget Airport near ParisMore

Saudi Arabian budget carrier Flyadeal has withdrawn a preliminary agreement for an order of up to 50 Boeing's grounded 737 MAX jets, US top aircraft manufacturer Boeing Company said on Sunday.

We believe that the fatal crashes and Boeing's failure to bring back 737 Max in service over the past few months must have also impelled Flyadeal to take this drastic step.

The cancelation of the MAX order will hit Boeing at a tune of $5.9 billion based on list prices for the aircraft, as well as a much higher cost in terms of airline confidence for the jet at a time when the manufacturer is drastically trying to regain trust in the new build. Flyadeal could not immediately be reached for further comment. Rather, Boeing said it is proud of its long partnership with Saudi Arabia's aviation industry.

Last month IAG said it meant to buy 200 Boeing 737 Max aircraft.

Oman Air warned in June it would hold talks with Airbus if Boeing did not provide support and recovery for the MAX.

Flyadeal said the Airbus agreement emerged from last month's Paris Air Show.

The deal would have earned Boeing billions of dollars.

"The additional aircraft are part of the dual brand strategy of the Saudi Arabian Airlines Corporation where Flyadeal serves the price conscious customer that is seeking Everyday Low Fares", Flyadeal said. The planes have been grounded worldwide, deliveries of the plane have halted, airlines have said they will demand compensation, and in March the plane maker lost a major order because of the tragedies. Preliminary investigations point to the role played by new software on the jet. That fund is unrelated to any potential losses from lawsuits filed by the families of victims.

Boeing's shares traded down about 1.3% at $351.10 in Monday's premarket.

While the company's stock is still up more than 8% this year, shares have dropped more than 20% from their peak in early March, shortly before the second deadly accident involving a Max.

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