The chief executive of Boeing has said the manufacturer might consider slowing down or halting production of the 737 Max as the company reported a US$3.4 billion (£2.7 billion) loss due to the troubled aircraft model.

The £2.7 billion hit is Boeing’s largest-ever quarterly loss, though the company had earlier warned shareholders that it was expecting a £5 billion impact caused by increased costs in relation to the 737 Max.

During a conference call with investors, CEO Dennis Muilenburg said that if the grounding order on the aircraft continues much longer, the company will consider reducing or shutting down production on the model.

However, Muilenburg said he is confident the aircraft will return to service this October.

He said: “Should our estimate of the anticipated return to service change, we might need to consider possible further rate reductions or other options, including a temporary shutdown of the Max production.”

The entire global fleet 737 Max planes was grounded in March following an Ethiopian Airlines crash that killed 157 people. Five months prior to this, a Lion Air accident involving the same model resulted in all 189 people on board being killed.

Investigators have pointed to a problem with the aircraft’s Manoeuvring Characteristics Augmentation System (MCAS) as a factor in both crashes.

Boeing developed a software update for the system and handed it over to the US Federal Aviation Administration (FAA) for testing, but the regulator found issues with the patch that would need to be addressed before it could recertify the 737 Max.

Even after the Max goes back into service, passengers could feel uneasy about flying on the aircraft and travel managers have said they believe their travellers will avoid flights operated by the plane when booking business trips.

In the meantime, Boeing has lost future orders for the aircraft and has already decreased production of the plane to deal with a pause in deliveries, which has hit the company’s cash flow and profit margins.

The manufacturer is also facing legal action by the family of a British passenger killed in the Ethiopian Airlines crash.

In a statement following the investors’ call, Muilenburg said: “This is a defining moment for Boeing and we remain focused on our enduring values of safety, quality and integrity in all that we do as we work to safely return the 737 Max to service. During these challenging times, teams across our enterprise continue to perform at a high level while delivering on commitments and capturing new opportunities driven by strong, long-term fundamentals.”

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