What next for Boeing and the Dreamliner?

It was billed as the jet of the future but technical issues have forced airlines to ground planes. What does this mean for the $24.2bln fleets of Middle Eastern carriers?

Like airlines across the world, regional carriers were quick to take advantage of Boeing’s newest plane, placing orders for a combined 117 aircraft with a list price of $24.2bn. Abu Dhabi-based Etihad Airways is so far the largest customer in the Middle East with 41 aircraft on order, followed closely by Qatar Airways with 30 on order and options for a further 30. Saudi Arabian Airlines, Oman Air, Gulf Air, Royal Jordanian and Iraqi Airways have also placed orders for the aircraft, which has a list price of $207m.  

As the only regional carrier to take delivery of the Dreamliner to date, Qatar Airways has so far been the only Middle East airline affected by the technical glitches. While the Doha-based airline has a large enough fleet to be able to avoid any disruption, much of its — and others’ — future will rely on how long the aircraft remains grounded.

“At present, it’s only really Qatar Airways that will bear the brunt of any impact. With deliveries halted, the relative impact will be limited although this will of course be paced by how long the US Federal Aviation Administration and other agencies decide to keep the 787 fleet grounded,” says Saj Ahmad, chief analyst at StrategicAero Research.

Boeing has said it is throwing all of its resources at the problem but has halted deliveries until the battery concerns are resolved. While there has been no indication as to how long the investigation will take, a report last week by the National Transportation Safety Board ruling out excessive voltage as the cause of a battery fire, which contradicts preliminary findings from Japanese authorities, could delay the return of flights.

Airlines, already frustrated at delays due to new production techniques, are likely to seek compensation. Even before he was forced to ground the 787 fleet, Qatar Airways boss Al Baker had said that grounding planes would result in Boeing having “to get their cheque book out”.

“Undoubtedly there will be behind the scenes claims for late deliveries, grounded flights and lost revenue,” adds John Strickland, a director at JLS Consulting.

Compensation and embarrassment aside, observers agree that regional airlines are unlikely to reassess their order books in light of the glitches. Airlines view their fleet as investments spread across decades and the promise of significantly reduced fuel costs coupled with improved passenger experience, means the Dreamliner’s fate remains closely linked to their own. As such, carriers around the world have been quick to rally behind Boeing.

Days before Qatar Airways was forced to ground its fleet, Al Baker insisted the jet is simply experiencing “teething problems”. Airlines including United Continental Holdings — the only US airline currently flying the 787 — and Boeing have little doubt that the Dreamliner will fly again. “It will be a great airplane but we are going to have to work through these issues with all of the authorities,” says Jeff Johnson, president of Boeing Middle East.

Crucially, the Dreamliner is not the first aircraft to experience technical difficulties and survive. Rival Airbus managed to recover confidence and orders in spite of wing cracks, which continue to plague its A380 superjumbo. Nor is it the first to be grounded.  The De Havilland Comet, the first commercial jet to launch in 1952, was temporarily grounded following a series of fatal crashes but its variants later went on to deliver nearly 50 years of service.

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