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Asia-pacific

Dreamliners grounded worldwide over safety

Text by FRANCE 24

Latest update : 2013-01-17

International airlines rushed to rearrange flight plans on Thursday as Europe, India and Japan joined the United States in grounding Boeing 787 Dreamliner flights pending an investigation into battery problems.

Airlines scrambled on Thursday to rearrange flights as Europe, Japan and India joined the United States in grounding Boeing Co’s 787 Dreamliner passenger jets while battery-related problems are investigated.

The lightweight, mainly carbon-composite plane has been plagued by recent mishaps - including an emergency landing of a Japanese domestic flight on Wednesday after warning lights indicated a battery problem - raising concerns over its use of new technology, such as lithium-ion batteries.

The U.S. Federal Aviation Administration (FAA) on Wednesday temporarily grounded Boeing’s newest commercial airliner, saying carriers would have to demonstrate the batteries were safe before the planes could resume flying. It gave no details on when that might happen.

The European Aviation Safety Agency has confirmed that the US decision to ground Boeing 787s pending a safety review will apply to all Dreamliner jets worldwide.

It is the first such action against a U.S.-made passenger plane since the McDonnell Douglas DC-10 had its airworthiness certificate suspended following a deadly crash in Chicago in 1979, analysts said.

Boeing has sold around 850 of the new planes, with 50 delivered to date. Around half of those have been in operation in Japan, but airlines in India, South America, Poland, Qatar and Ethiopia, as well as United Airlines in the United States, are also flying the aircraft, which has a list price of $207 million.

With most of that Dreamliner fleet now effectively out of action as engineers and regulators make urgent checks - primarily to the plane’s batteries and complex electronics - airlines are wrestling with gaps in their scheduling.

Japan Airlines Co said on Thursday the 787 grounding would lead to three flight cancellations, affecting more than 500 passengers. A spokesman for Air India said no flights had been cancelled as the airline was using other planes. “We’re working out a plan to handle the situation, and will hopefully know by this evening how we should go about it,” G. Prasada Rao told Reuters.

Motohisa Tachikawa, spokesman for JTB, a Tokyo-based travel services firm, said there had not yet been any direct impact on flight bookings. “I’m sure JAL and ANA are furiously trying to assign replacement planes for those that are grounded. How and when they will make that clear will impact our situation,” he told Reuters.

Cost of planes on ground

Keeping the 787s on the ground could cost ANA alone more than $1.1 million a day, Mizuho Securities calculated, noting the Dreamliner was key to the airline’s growth strategy.

Regulators in Japan and India said it was unclear when the Dreamliner could be back in action. A spokesman for the European Aviation Safety Agency said the region would follow the FAA’s grounding order. Poland’s state-controlled LOT Airlines is the sole European airline currently operating the 787.

LOT spokesman Marek Klucinski told Polish TVN24 channel that the airline had not encountered any similar problems with its two 787s, and was still taking delivery of the remaining three it had ordered from Boeing.

Boeing said in a statement it was confident the 787 was safe and it stood by the plane’s integrity.

“Boeing is committed to supporting the FAA and finding answers as quickly as possible,” CEO Jim McNerney said. “The company is working around the clock with its customers and the various regulatory and investigative authorities.”

Passengers leaving United’s flight 1426 in Houston - which had taken off from Los Angeles moments before the FAA announcement - reported an incident-free trip.

“I fly over 100,000 miles a year,” said Brett Boudreaux, a salesman from Lake Charles, Louisiana. “That was one of the most relaxing flights I’ve ever had. I hope they sort it out. It’s a hell of a plane.”

Boeing shares fell 2 percent in after-hours trading on Wednesday, to $72.75.

“Ultimately, you can view it as a positive thing if they can resolve what the issues are and give people confidence in the safety of the aircraft,” said Ken Herbert, analyst at Imperial Capital in San Francisco. “In the near-term, though, it’s a negative. It’s going to force the company to make significant investments.”

Scott Hamilton, an analyst at Leeham Co, an aerospace consulting firm in Seattle, said having a plane grounded “is about the worst thing that can happen to an airplane programme”.

“If this goes beyond just a bad design of a battery and you have to redesign some systems leading to the battery, and look at why didn’t safeguards on this thing work, you get a ripple effect,” he said. “They’ll have more airplanes going out the door and they can’t deliver them. So you build up inventory. Every day .. is an added day of delivery delays.”

Six new 787s, painted and apparently ready for delivery to various airlines, were parked on the apron at Paine Field in Everett, Washington, adjacent to Boeing’s 787 plant on Thursday. Four more Dreamliners occupied the final assembly spots inside the factory.

Smoke and soot

Yoshitomo Tamaki, director general at the Japan Transport Safety Board (JTSB), said checks on the ANA flight that made the emergency landing showed a bulge in the metal box that cases the main battery. The electric equipment bay, where the battery is located, had a strong smell of smoke and soot was found on the box and on two exterior valves used to regulate temperature in the plane. JTSB spokesman Takayuki Someya said the investigation would focus on whether this was battery-related.

The use of new battery technology is among the cost-saving features of the 787, which Boeing says burns 20 percent less fuel than rival jetliners using older technology.

Shares of GS Yuasa Corp, a Japanese firm that makes batteries for the Dreamliner, tumbled as much as 7.5 percent to a 2-month low. The stock has dropped 18 percent since Jan. 7 when one of its batteries caught fire in a parked JAL-operated 787 at Boston Logan International Airport.

The 787 represents a leap in the way planes are designed and built, but the project has been plagued by cost overruns and years of delays. Some have suggested Boeing’s rush to get planes built after those delays resulted in the recent problems, a charge the company denies.

Based on how regulators usually handle air safety, experts say U.S. authorities and Boeing will discuss the criteria for inspections on the Dreamliner. They would also set what fixes, if any, are needed and a timetable for those. Analysts say it’s unclear how long such a process could take or how much it could cost, but some question whether Boeing can stick to its target of doubling 787 output to 10 a month by the end of this year.

“It guarantees some throttling back in production. It’s clear one of the problems was building planes before fully understanding the rhythm of production,” said Teal Group analyst Richard Aboulafia.

Moody’s said the 787 grounding was a negative credit development for Boeing, but ratings were not expected to be impacted for now. “This could pose new operating and financial pressures for Boeing, including further delay in delivery schedules and future order flow, as well as ongoing reputational risk,” noted Russell Solomon, Senior Vice President.

Barring a prolonged grounding or a severe crisis, aircraft industry sources say there was no immediate threat of plane cancellations.

“You aren’t going to see cancellations,” said Leeham’s Hamilton, noting airlines have no alternative as rival Airbus models are sold out and have years-long waiting lists.

The Dreamliner’s problems could sharpen competition with Airbus, which a year ago had its own crisis with wing crack problems on its A380 superjumbo.

(FRANCE 24 with wires)

 

Date created : 2013-01-17

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