Boeing (BA) - Get Report set plans Friday to shut down its production of C-17 military cargo aircraft, citing a lack of U.S. orders.

The Chicago-based aerospace giant said it is directing program suppliers to stop work on uncommitted airplanes in "the first step in an orderly shutdown of the production supply chain." Boeing blamed the government for not ordering enough planes.

Recent orders aren't enough to sustain continued production beyond mid-2009, Boeing said. This move will ultimately affect 5,500 Boeing jobs in California, Missouri, Georgia and Arizona.

The stop-work orders affect long-lead items from suppliers that, in many cases, are built 34 months before a C-17 is delivered. Boeing is re-evaluating the financial impact should the U.S. government not order additional C-17s, and may incur costs aside from any recovered from the U.S. government.

Shares fell $1.35 to $77.24.