Boeing has resumed production of the grounded 737 Max aircraft despite laying off more than 12,000 workers and still awaiting approval for the Max to resume flying.

Aircraft manufacturer Boeing issued notice of redundancy to almost 7,000 workers this week and reported another 5,520 had taken voluntary redundancy.

The Max has been grounded since March 2019 following two fatal crashes and the US Federal Aviation Administration has yet to approve the aircraft’s return.

Production of the Max was halted in January

Boeing has said it expects FAA approval for the aircraft to return this year.

In a statement, Boeing said 737 Max production would return “at a low rate” as it implements “initiatives focused on enhancing workplace safety and product quality”, but would “gradually ramp up”.

Scott Stocker, vice-president of Boeing 737 manufacturing, said “The steps we’ve taken in the factory will help drive our goal of 100% quality while supporting our commitment to workplace safety.”

The resumption came amid concern about the survival of companies supplying parts for the 737 Max.

Boeing president and chief executive Dave Calhoun told a shareholders meeting in April: “Without the supply chain, there will be nothing for us to assemble.”

Separately, Calhoun told employees this week: “We have come to the unfortunate moment of having to start involuntary layoffs.

“We’re notifying the first 6,770 of our US team members that they will be affected. Our international locations also are working through workforce reductions.

“The Covid-19 pandemic’s devastating impact on the airline industry means a deep cut in the number of commercial jets and services our customers will need over the next few years, which in turn means fewer jobs.”

Calhoun noted “We are seeing some green shoots. Some of our customers are reporting reservations are outpacing cancellations on their flights for the first time since the pandemic started.”

But he warned: “Enormous challenges remain. We will have to adjust our business plans constantly until the global pandemic stops whipsawing our markets.”

Despite cancellation of some orders for the Max, Boeing retains firm orders for more than 3,800 of the aircraft.