The move comes after a crash in Ethiopia involving that type of aircraft killed 158 people, including 18 Canadians, this past weekend. Five months earlier, a 737 Max operated by Lion Air crashed in Indonesia, killing 189 people.
Garuda joins Indonesian private carrier Lion Air and a number of global airlines in weighing a switch away from Boeing's Max jetliner to other aircraft after regulators around the world chose to ground Boeing's most popular model.
Until today's decision, Canada and the United States were two of the notable outliers, with Air Canada and WestJet both publicly stating that they had confidence in the plane.
Yesterday the FAA said 737 Max airliners would not be allowed to fly until new software had been "tested, approved and installed", a process likely to last until May, according to U.S. politicians briefed on the situation.
Low-priced airline Norwegian Air Shuttle, South Korea's Eastar Jet and South Africa's Comair also said they would halt flights. There are 40 other airlines worldwide flying this kind of plane.
The U.S. Federal Aviation Administration grounded the planes Wednesday, saying regulators had new satellite evidence that showed the movements of Ethiopian Airlines Flight 302 were similar to those of Lion Air Flight 610. But if the crash was caused by pilot error, then the problem could be corrected by training, and the grounding could be short, Goelz said.
He said: "Regarding Air Peace and Arik orders, whether those orders were confirmed or intent, it is to our knowledge in the ministry that they won't be in the country until the next two years or so".
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"We make our own decisions in Canada and occasionally those decisions may be different from our colleagues south of the border", Garneau said.
The Boeing 737 MAX crash in Ethiopia looks increasingly likely to hit the planemaker's order book as mounting safety concerns prompt airlines to reconsider purchases worth about US$55 billion.
Garneau said he will reverse the ban when he sees the "smoking gun that will explain what happened with this particular flight".
Investigators looking into the Indonesian crash are examining whether the software automatically pushed the plane's nose down repeatedly, and whether the Lion Air pilots knew how to solve that problem by throwing toggle switches and cancelling the automated nose-down commands.
"We are working to rebook impacted customers as soon as possible but given the magnitude of our 737 Max operations, which on average carry 9,000 to 12,000 customers per day, customers can expect delays in rebooking and in reaching Air Canada call centres and we appreciate our customers' patience".
The aircraft was en route from Addis Ababa to Nairobi with 149 passengers and eight crew on board.