September 27, 2021

Dreamliner: Japan’s ANA cancels more Boeing 787 flights

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_62439093_130736599Japan’s All Nippon Airways (ANA) has said it will cancel all Boeing 787 flights until at least the end of May, in the latest blow to Boeing.

International regulators grounded all 787 Dreamliners in January so that safety checks could be carried out on their lithium ion batteries.

ANA is cancelling more than 1,700 flights in April and May, a period that includes Japan’s Golden Week holiday.

It takes the total number of affected ANA Dreamliner flights to 3,600.

_66053246_66053241ANA is Boeing’s biggest Dreamliner customer, with 17 of the world’s 50 operational 787s.

Referring to the extended period of cancellations, an ANA spokeswoman said: “Unfortunately, it includes Golden Week, but we have decided to inform our customers in advance as the prospect for their resumption is still unseen.”

Proposed fix

Boeing’s entire fleet of Dreamliners was grounded after a battery on a Japan Airlines 787 caught fire, and a malfunction forced an ANA flight to make an emergency landing.

But investigations into the battery have so far proved inconclusive.

On Friday, Boeing gave US regulator, the Federal Aviation Administration (FAA), its plan to fix the battery problems, which reportedly involves a significant redesign of the battery pack with new ceramic insulation around each of the battery’s eight cells.

According to the Seattle Times, the fix also involves using a system of venting tubes that in case of an incident would channel any flammable vapours or liquids directly out of the plane, and continuous monitoring of the temperature and voltage of individual cells within the battery.

The FAA said it was reviewing the plan. “The safety of the flying public is our top priority and we won’t allow the 787 to return to commercial service until we’re confident that any proposed solution has addressed the battery failure risks,” it said.

Boeing hopes the fix could allow Dreamliners to be back flying by mid-April. But industry analysts have suggested it could take longer, as getting approval for the redesigned batteries could take several months.

“Recertification suggests time,” Carter Leake, an aerospace analyst at BB&T Capital Markets, said.

“Given what most know about aircraft certification processes, six months would be sort of quick.”

The problems with the Dreamliner are already proving costly to airlines and to Boeing, and the costs are set to continue growing.

ANA lost some 1.4bn yen ($15m; £9.5m) in revenue through January’s disruption alone.

Boeing also faces potential compensation payouts to airlines who have been forced to cancel Dreamliner flights.

Last week, Australian carrier Qantas said it had received 125m Australian dollars ($129m; £85m) compensation from the US planemaker over the grounded 787s.

Analysts have also warned that Boeing’s woes could deepen if airlines who have the Dreamliner on order ask for deliveries of the plane to be delayed.

The planemaker itself has already had to delay delivery of the plane to two European airlines – Thomson Airways and Norwegian Air Shuttle.

Thomson, which had been due to take delivery of Dreamliners at the end of February, said it had not yet been given a new delivery date by Boeing.

“Our priority is to ensure our customers go on their holidays and we are, therefore, putting contingency plans in place including using alternative aircraft for our long-haul flights to Mexico and Florida if delivery is delayed beyond the end of March,” Thomson said in a statement.

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Qantas: Boeing compensation boosts first-half earnings

Qantas profits have risen, boosted by compensation from Boeing after it cancelled 787 orders and amid narrowing losses on its international operations.

It made a net profit of A$111m ($114m; £75m) in the six months to the end of December, up from A$42m a year earlier.

The figure includes A$125m compensation that Qantas received from Boeing.

The carrier said that losses at its international division, which has been a key area of concern, narrowed to A$91m from A$262m a year earlier.

Its international business has been hurt by slowing demand from its key markets and high fuel costs.

Qantas has also lost passengers to rival carriers, reducing its share of the international market.

As a result, the firm has taken measures to try to turn around the fortunes of the unit, including cancelling services on loss-making routes and streamlining some of its maintenance operations and cutting jobs.

It has also formed an alliance with Emirates, with the two carriers agreeing to collaborate on pricing, sales and flight scheduling.

Alan Joyce, chief executive of the airline, said the measures were starting to have an impact on the airline’s earnings.

“We are now beginning to realise the benefits of the tough decisions that we have made over the past 18 months,” Mr Joyce said.

“Qantas International is well advanced in its turnaround plan.”

However, the airline’s domestic operations, which have been the biggest driver of its growth in recent times, saw a decline in profits during the period.

Profits at the division fell to A$218m from A$328m a year earlier.

Qantas said that increased competition in the sector was a key factor behind the decline.

“Clearly the Australian domestic market is highly competitive,” Mr Joyce said. “We have seen elevated levels of capacity growth from competitors attempting to claim market share from Qantas Domestic.”

“This has put pressure on yield for all airlines,” he added.

Some analysts said that they had expected profits of the division to dip, but added that it was not a cause of worry.

“The basic fact remains that they are still making a healthy profit despite the competition on pricing amid the push to retain corporate travellers,” Siva Govindasamy of Flightglobal told the BBC.

Qantas said that it renewed 40 and won 39 new accounts for corporate travel during the period.

“We are confident that with our balanced portfolio of domestic airlines we will remain the leader in every segment of the market,” Mr Joyce said.

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