Boeing shares fall 3pc as planes grounded
Published 17/01/2013 | 05:00
SHARES in Boeing slumped more than 3pc after the two biggest users of the new 787 Dreamliner plane grounded their fleets amid growing questions about the revolutionary airliner's safety.
Japan's All Nippon Airlines, which was the first carrier to take on the Dreamliner, said it had stopped flying its 17 jets, while compatriot JAL has also grounded its fleet.
The move came a day after an All Nippon flight had to make an emergency landing and passengers exited by escape chutes after cockpit instruments showed a battery malfunction and smoke warnings on the craft.
The incident, described by a transport ministry official as "highly serious", is the latest mishap to hit the world's first mainly carbon-composite airliner in recent days.
A lithium-ion battery, one of several used on a 787, caught fire in a JAL flight that had landed at Boston's Logan Airport last week.
That was followed by reports of a cracked windscreen on an All Nippon flight later in the week, while both airlines reported numerous fuel leaks in the planes.
The 787 represents a leap in the way planes are designed and built, but the project has been plagued by cost over-runs and years of delays.
Boeing has orders for more than 3,000 of the planes, which rely on electronics to a much greater extent than traditional jets.
While the use of electricity makes the plane much more fuel efficient than competitors, it uses far more lithium-ion batteries than regular liners.
Pilots have long viewed this type of battery with suspicion as it tends to burn much more intensely if it catches fire than other forms of battery.
Both the US Federal Aviation Administration and the National Transportation Safety Board (NTSB) said they were monitoring the latest incident as part of a comprehensive review of the Dreamliner announced late last week.
Financial analysts warned of the impact on Boeing.
"I think you're nearing the tipping point where they need to regard this as a serious crisis," said Richard Aboulafia, a senior analyst with the Teal Group in Fairfax, Virginia.
"This is going to change people's perception of the aircraft if they don't act quickly."
Robert Mann of RW Mann in New York agreed.
"The issue now is, how rapidly can the NTSB get to the source of the battery issue and how rapidly operators can get inspections done.
"It would be an understatement to say this is bad for Boeing," he added.