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A nightmare scenario for Dreamliners

THE crisis enveloping Boeing's new flagship aircraft has deepened, with regulators around the world following the lead of US regulators in grounding the 787 Dreamliners.
By · 18 Jan 2013
By ·
18 Jan 2013
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THE crisis enveloping Boeing's new flagship aircraft has deepened, with regulators around the world following the lead of US regulators in grounding the 787 Dreamliners.

Australian engineers expect the forced groundings to delay by three to six months the delivery of 787s to the Qantas Group, the first of which was scheduled to arrive in the second half of this year.

However, Qantas said it had no advice from Boeing to suggest that the planes would be delayed.

It comes as the industrial umpire put the onus on Qantas and its long-haul pilots to resolve differences in their long-running dispute. Fair Work Australia rejected the pilots' key demands over job security.

While favouring Qantas on matters such as rostering and union veto on flights beyond 14 hours, it did not give the airline all it sought in terms of productivity improvements.

The two sides have until February 12 to draft an agreement.

It is the last to be resolved of three disputes between Qantas and key parts of its workforce, which culminated in the dramatic grounding of the airline's entire fleet in late 2011.

In a major blow to Boeing, the US Federal Aviation Administration grounded the Dreamliners because of a potential risk of fire from its batteries.

The drastic step followed an emergency landing of an All Nippon plane in Japan on Wednesday caused by a malfunctioning battery, just a week after a battery fire in a Japan Airlines 787 in Boston.

Regulators from Europe to India and Japan followed the lead of their counterparts in the US in ordering the planes to remain on the ground. It is the first time the FAA has grounded an aircraft type since 1979, when it kept DC-10s on the tarmac.

Paul Cousins, the president of the Australian aircraft engineers' union, said he expected the problems besetting the Dreamliner to result in Qantas' budget offshoot, Jetstar, receiving its first 787s up to six months later. "Obviously it is going to set back Qantas. The FAA doesn't [ground] planes lightly," he said. "It seems clear at this point in time that they are unsafe."

But Qantas stuck by its earlier comments on Wednesday that it remains on track to receive the first Dreamliners in the second half of this year, and expressed confidence that the issues would be resolved.

Boeing also said it did not have any information to suggest the planes destined for Qantas would be delayed further. The plane is already more than three years' late.

Qatar Airways has said it will be the first to fly the 787 to Australia, but by Thursday night had declined to reveal whether the Dreamliner flights between its base in Doha and Perth would be postponed. The services were scheduled to begin on February 1.

The Civil Aviation Safety Authority said the FAA had kept it fully informed but it did not have to express a position because the 787 was yet to be flown to Australia.

Qatar Airways and Air India are the only two foreign airlines which have approval to fly 787s to Australia.

Asia's largest airline, China Southern, is also considering whether to operate the 787s on routes to Australia but is not scheduled to take delivery of the first of 10 Dreamliners on order until late March.

Apart from the 15 787-8 Dreamliners destined for Jetstar, Qantas has purchase rights and options for 50 of the longer-range 787-9 aircraft, the first of which will not arrive until 2016.



WINGS CLIPPED

Top 10 orders

QANTAS 15

Air India 22

LAN Airlines 23

Air France KLM Group 25

Qatar 25

Air Canada 37

Japan Airlines 38

Etihad 41

United 44

All Nippon Airways 49



Timeline of safety failures

2012

DEC 4

United Airlines forced to make an emergency landing after electrical problems

DEC 13

Qatar Airways grounds a 787 after electrical problem

DEC 17

United reports an electrical problem in a second plane

2013

JAN 8

A fuel leak forced a 787 operated by Japan Airlines to cancel takeoff

JAN 9

All Nippon Airways cancelled domestic 787 flights due to brake problems

JAN 16

ANA's flight 692 is forced to make an emergency landing after smoke appears in the cockpit

JAN 17

US aviation regulator grounds the Boeing 787 Dreamliner
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Frequently Asked Questions about this Article…

The US Federal Aviation Administration (FAA) ordered the Boeing 787 Dreamliners to be grounded because of a potential fire risk from their lithium-ion batteries. The FAA's action followed safety incidents including a battery fire on a Japan Airlines 787 in Boston and an All Nippon Airways 787 emergency landing in Japan. Regulators in Europe, India, Japan and elsewhere followed the FAA's lead.

The grounding affected airlines operating or taking delivery of 787s worldwide, with regulators from Europe to India and Japan following the FAA. In Australia, the Civil Aviation Safety Authority (CASA) said it was kept fully informed. Qatar Airways and Air India are the only foreign carriers approved to fly 787s to Australia, while other carriers such as China Southern, Qantas (and its Jetstar offshoot), Japan Airlines and All Nippon Airways are mentioned in the context of deliveries and incidents.

Australian aircraft engineers said the forced groundings could delay delivery of 787s to the Qantas Group by three to six months, which would push back Jetstar's first 787s. Qantas, however, said it had received no advice from Boeing suggesting delays and remained confident the first Dreamliners would arrive in the second half of the year. Boeing also stated it had no information indicating Qantas-destined planes would be delayed.

A string of safety problems occurred between December 2012 and January 2013: electrical problems forced a United Airlines emergency landing (Dec 4); Qatar Airways grounded a 787 after an electrical issue (Dec 13); United reported a second electrical problem (Dec 17); a fuel leak forced a Japan Airlines 787 to cancel takeoff (Jan 8); All Nippon Airways cancelled domestic 787 flights due to brake problems (Jan 9); ANA flight 692 made an emergency landing after smoke appeared in the cockpit (Jan 16); and on Jan 17 the FAA grounded the Boeing 787.

Qatar Airways had planned to be the first to operate the 787 to Australia, with Doha–Perth flights scheduled from February 1. Following the FAA grounding, Qatar declined to say whether those flights would be postponed. The grounding introduces uncertainty for any new or planned 787 services until regulators and Boeing resolve the battery and safety issues.

The article notes the 787 program was already more than three years late. The FAA grounding — the first grounding of an aircraft type since the DC-10 in 1979 — is a significant reputational and operational setback. Many major carriers have large 787 orders (Airlines listed include All Nippon, United, Etihad, Japan Airlines, Air Canada, Qatar, Air France-KLM, LAN, Air India and Qantas), so any extended grounding could disrupt delivery schedules and airline plans.

Paul Cousins, president of the Australian aircraft engineers' union, said the FAA rarely grounds planes lightly and expected the Dreamliner problems to set back Qantas and delay Jetstar's first 787s by up to six months. CASA said it had been kept fully informed by the FAA but did not need to express a position because the 787s had not yet been flown to Australia. Qantas maintained it was on track to receive its first Dreamliners in the second half of the year and expressed confidence the issues would be resolved.

Based on the article, investors should track official regulatory updates (FAA and other national authorities), statements and timelines from Boeing and affected airlines (Qantas, Jetstar, Qatar Airways, Japan Airlines, All Nippon), the outcome of safety investigations into the batteries and related incidents, and any revised delivery schedules. Also note related operational risks such as labour disputes at airlines (the article references ongoing Qantas pilot negotiations) that could compound disruptions.