Japan Still Cautious About Boeing 787

March 2, 2013, 2:03 a.m. ET

By PHRED DVORAK And YOSHIO TAKAHASHI

The Wall Street Journal

TOKYO—Japanese airlines and regulators said Friday they remain cautious about the prospect for imminent resumption of Boeing Co. Dreamliner flights—even after hearing how the Chicago-based aircraft maker proposes to fix the problems that are grounding the jets.

The wary statements come after days of presentations in Japan by Boeing's head of commercial aircraft on the company's proposed solution to battery problems that are bedeviling the cutting-edge planes. They suggest the Chicago-based aircraft maker, whose flagship 787 Dreamliners have been grounded since mid-January while regulators look for the cause of two overheating batteries, may still have some work to do to convince customers and aviation officials its proposals are foolproof.

A Japan Airlines aircraft takes off as a Boeing 787 plane owned by All Nippon Airways parks on the tarmac at Haneda Airport in Tokyo.

It is particularly vital for Boeing to win confidence for its proposals in Japan, since the country's two big airlines—All Nippon Airways Co.  and Japan Airlines Co. —are also the largest customers for the Dreamliner, holding nearly half of the 787s in global operation.

On Friday, Japan's transport minister said Boeing's proposed solution to the battery problems is a significant step forward but still just a "starting point" toward getting the planes back in the air.

It will likely "take some time" to examine the proposal and see whether it's satisfactory, Akihiro Ohta said at a news conference.

Meanwhile, the top executive of Boeing's biggest Dreamliner customer, ANA, who also saw the proposed fixes, said the jet maker seems to have made a good deal of progress. But Chief Executive Shinichiro Ito stopped short of predicting how soon his company's 787 planes could be back in service, saying only that the decision on lifting the grounding order is up to regulators in the U.S. and Japan.

"My impression was that these plans were quite advanced," Mr. Ito said at a separate news conference in which he made his first public comments on the 787s since the planes were grounded. However, "I am not a technical expert myself," he added.

A JAL spokesperson said the company had also met Boeing on the proposed fixes, but couldn't comment on them.

ANA is arguably the airline most invested in the fate of the cutting-edge Dreamliner: It was the first company to fly the 787s when they went into operation over a year ago, and it has 17 of them in its fleet, more than any other airline. The company has canceled thousands of flights after battery problems on two 787s spurred global regulators to ground the planes.

Airline watchers have been following ANA closely to see how big the financial impact of the Dreamliner grounding will be, and whether the flight suspension would force ANA to change its plans to buy up to 66 787s over the next several years.

Boeing, meanwhile, has been rushing to come up with a way to ensure the safety of the Dreamliner batteries, which use powerful but famously flammable lithium-ion technology—even though the company doesn't yet know what the root cause of the overheating was. Boeing proposed a solution to the U.S. Federal Aviation Administration last week, and Boeing's head of commercial airlines came to Japan this week to explain those measures to regulators and customers, including the minister and Mr. Ito.

The cautious outlook by the minister and the CEO overshadows the confidence expressed Thursday by Raymond Conner, head of Boeing's commercial airplane unit, that the 787 "will get back in the air soon."

Mr. Ito said that thus far the grounding of ANA's Dreamliners has hit ANA's revenue and delayed the completion of the company's midterm plan, but hasn't yet had a significant impact on profit. He also said ANA had no plans at the moment to change its purchasing plans for 787 jets. Nor has ANA asked Boeing for compensation for losses incurred from the grounding.

ANA would work hard to ensure customers felt safe to fly on the Dreamliner again by explaining the aircraft's features and how Boeing has worked to remedy the battery problems, as well as flying test flights before putting its jets back into operation, the CEO said. He declined to comment further on specific measures the company is considering. 

Source:  http://online.wsj.com