Key Boeing 787 Customer Confident on Battery Fix: WSJ

ORLANDO, Fla.—The head of an influential Boeing Co. 787 customer said Tuesday that the aerospace group's proposed battery fix will preserve the jet's value to leasing companies.

Boeing's "permanent" fix addresses the potential causes of twin incidents affecting the jet's lithium-ion batteries that prompted the world-wide grounding of the 787 Dreamliner fleet in January, said Jeff Knittel, president of transportation finance at CIT Group Inc.

Mr. Knittel told reporters at an industry conference that Boeing has "come up with a fix that makes sense," even as investigators have failed to find the underlying cause of the battery incidents on two 787s operated by Japanese airlines.

Boeing has suspended 787 deliveries, while 50 remain grounded pending regulatory approval of the proposed remedies. Leasing companies such as CIT and International Lease Finance Corp.—which was due to hand over its first 787 to a customer next month—account for more than a third of the global jet fleet.

Mr. Knittel confirmed changes to the 787 battery include increased spacing between the eight lithium-ion battery cells, a specially-designed containment box and a venting system to isolate a fire and vent any smoke or fumes.

He said CIT expects to receive the first of 10 Dreamliners on order in late 2014. He expected concerns over the 787 to be quickly left behind when it returns to service, though owners will have to assess the durability of the battery fix and its impact on maintenance costs.

The Federal Aviation Administration is evaluating a proposal from Boeing that the plane maker said will address a host of potential causes unearthed during probes being conducted alongside U.S. and Japanese aviation safety watchdogs.

If approved, Boeing will be able to start formal flight testing and certification of the battery fix, though the FAA will still have to evaluate the company's findings and give the final green light to resume commercial flights.

Mr. Knittel said some 787 customers have sought replacement aircraft ahead of the summer season, though that activity has been limited. "This is not some feeding frenzy out there," he says.