Wednesday, September 25, 2013

Boeing Working to Fix 787 Glitches: WSJ

Updated September 25, 2013, 3:50 p.m. ET


The Wall Street Journal

The head of Norwegian Air Shuttle ASA said Wednesday that Boeing Co. is sending a team to Norway to probe the technical problems that have afflicted its two 787 Dreamliners, and will store spare parts at four airports used by the low-cost carrier.

Ray Conner, head of the Boeing Commercial Airplane unit, also traveled to Oslo to meet with Norwegian Air Chief Executive Bjorn Kjos to review the problems, with other 787 operators also suffering from glitches.

Norwegian Air has been forced to delay some flights and withdraw its two 787s from service several times in recent weeks amid technical problems that include power-supply glitches and indications of brake system issues.

"If this continues, it's totally unacceptable," said Mr. Kjos in an interview after meeting Mr. Conner. "This is very damaging not only for Norwegian's reputation, but also for Boeing's."

Mr. Kjos said Boeing had promised quick action to remedy the problems, and as an interim measure planned to store more spare parts at Norwegian Air's Oslo base as well as in Stockholm, New York and Bangkok, where the airline flies its 787s.

The two companies have yet to agree on any compensation for the problems, said Mr. Kjos.

Mr. Conner's appearance in Oslo signals the seriousness of the 787's reliability issues. He is reprising a role seen earlier this year when he shuttled back and forth to Japan during the 3½ month grounding of the 787 following twin incidents with its lithium-ion batteries.

He and other Boeing executives hosted news conferences and offered repeated apologies for the Dreamliner's disruptions. Japanese carriers, who were the first to take delivery of the jet two years ago, account for the largest share of the 787's operators today.

Boeing has delivered 85 Dreamliners to 14 customers, with this month marking the second anniversary of the first arriving at Japan's All Nippon Holdings Inc.

Boeing said airlines are operating around 200 flights a day with 787s. The company has sought to harness the 787's onboard health monitoring technology to bolster the aircraft's dispatch reliability, keeping a live stream of data coming from the aircraft alerting the airline and its manufacturer to potential problems.

"How the 787 performs in service for our customers is paramount for the entire Boeing team. Any impact to our customers' operations is not satisfactory to us," said a Boeing spokesperson. "We are working airline-by-airline to ensure we have the right support in place to help each airline through the entry-into-service process."

Qatar Airways Chief Executive Akbar Al Baker, a regular critic of Boeing and Airbus over technical and commercial issues, had remained supportive of the 787 during this year's grounding, but has turned critical as issues have hurt the reliability of the Gulf carrier's own Dreamliners.

"There are so many teething problems. although it is not anything major that would require us to ground our aircraft, it is enough to give us grief on our dispatch reliability," said Mr. Al Baker, according to a report in aerospace industry publication last week.

LOT Polish Airlines SA was forced to halt flights on its Dreamliners after engines on two jets were found to be missing fuel filters. In August, Polish Treasury Minister Wlodzimierz Karpinski met with the U.S. ambassador to Poland, Stephen Mull, to ask for assistance in negotiations between LOT and Boeing over earlier damages stemming from the grounding, which the government previously estimated at above $30 million.

LOT and Norwegian have anchored their long-haul ambitions solely on the Dreamliner, encountering significant financial and operational disruption when the jet has run into problems common for new aircraft, forcing each to rely on older less-efficient leased jets. Mr. Kjos said Wednesday he didn't know how much the 787 problems had cost Norwegian. Analysts and investors have shrugged off the 787's technical problems and remain focused on the rising revenues and falling costs of the Dreamliner program. Boeing shares are up 57% so far this year and have hit all-time highs in recent sessions. The stock was recently down 0.4% at $118.48.


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