Saudi budget carrier flyadeal has withdrawn a provisional order for Boeing's grounded 737 MAX jets, the US plane maker said Sunday, as the airline confirmed it will operate an entirely Airbus fleet.
"We understand that flyadeal will not finalise its commitment to the 737 MAX at this time given the airline's schedule requirements," a Boeing spokesman said.
The carrier's provisional order was for "up to 50 MAXs -- commitment for 30 and then options for 20 more", the spokesman added.
The announcements mark another setback for Boeing, whose global fleet of 737 MAX planes has been grounded since mid-March following two crashes which claimed 346 lives.
In a separate statement, flyadeal said it will operate an all-A320 fleet, buying up to 50 of these aircraft from Boeing's European rival Airbus.
"Flyadeal announces a significant growth to its fleet, with an order for 30 A320 NEO aircraft, and options for a further 20 A320 NEO family aircraft," the carrier said, adding that deliveries will begin in 2021.
"This is in response to continuing growth in passenger demand across domestic, regional and international routes."
The purchases are part of an order placed last month at the Paris Air Show by Saudi Arabian Airlines, flyadeal's parent company.
Saudi Arabian Airlines, the kingdom's national carrier, had ordered at the show 65 A320 neo-type aircraft from Airbus worth more than $7.4 billion (6.6 billion euros) at list prices.
Flyadeal, launched in 2017, currently operates a fleet of 11 Airbus A320 aircraft to domestic destinations across the kingdom, according to its website.
Boeing is under global scrutiny after crashes of 737 MAX planes operated by Lion Air and Ethiopian Airlines.
The MAX was grounded globally after the Ethiopian crash and there is still no firm timetable for returning the planes to service.
Boeing said Wednesday it would give $100 million (89 million euros) to communities and families affected by the 737 MAX disasters.
The company has been widely criticised over its development of the 737 MAX, which included a flight handling system called the Maneuvering Characteristics Augmentation System (MCAS) that has been seen as a factor in both crashes.
The MCAS pointed the nose of both planes sharply downward based on faulty sensor readings, hindering pilot control after takeoff, according to preliminary results from the crash investigations.
Pilots have said they were not adequately trained on the MCAS system and that it was not disclosed to them, while US regulators said they were kept in the dark for more than a year about a problem with a sensor linked to the system.