Lucky Boeing: Latest 787 Mishap Traced to Supplier

Boeing 787 Jet on Fire

ANA Holdings (ALNPF.PK) — the operator of the largest fleet of Boeing (NYSE:BA) 787 Dreamliners — found wiring defects in three of its planes on Wednesday. Officials discovered the wiring issue in the fire suppression system of an All Nippon Airways-operated aircraft waiting to depart Tokyo’s Haneda airport.

A spokeswoman for the airline told The Wall Street Journal that the wiring problems in the fire extinguishing units for the plane’s two engines could have meant that the extinguisher in the wrong engine would be activated in the event of a fire. After a short investigation, Boeing has determined why the fire extinguisher nozzles were routed to the wrong engines: The engine-fire extinguishers were improperly assembled at a supplier’s facility.

The jet manufacturer said in a written statement obtained by the Journal that the faulty electrical wiring “does not present a safety of flight issue because the [extinguisher] bottles are not the only means of fire extinguishing for engines and there are multiple redundancies within the fire extinguishing system.” A company spokeswoman further told the newspaper that activating the 787′s engine fire-extinguishing system “does not disable or impact [the engine’s] performance.”

In a statement, the company said: “Regardless, improperly configured components are not acceptable and this issue is being addressed promptly. Boeing will follow standard disciplined procedures to understand how this discrepancy occurred and ensure it is not repeated.”

Boeing asked all airlines operating 787s to inspect the jets to ensure that the extinguishing bottles were configured properly. United Continental (NYSE:UAL), the only United States-based Dreamliner operator, found “at least one” aircraft in its fleet of seven had improperly assembled extinguishers, a source familiar with the company’s operations told the Journal.

Concerns for fire safety are now given extra weight. In July, just several months after 787s around the world returned to the skies after being grounded because of several battery meltdowns, a blaze broke out on an Ethiopian Airlines-operated 787. It was a “serious event” that caused “extensive heat damage in the upper portion of the rear fuselage” of the jet, according to the United Kingdom’s Air Accidents Investigation Branch. The agency’s initial findings showed the fire was sparked by wires in a Honeywell-manufactured (NYSE:HON) emergency locator transmitter.

Many industry experts attribute these incidents as typical “teething problems” of the new passenger plane, but the rash of minor mechanical issues discovered since the 787 resumed operations has forced Boeing to fight to rebuild trust in the wide-body plane. Still, these problems have yet to coalesce into a major issue. The company was able to increase the list prices for most planes in its family of commercial aircraft on Friday, and its stock has advanced more than 37 percent so far this year.

The recent price increases reflect more on the state of the United States economy than on the company’s efforts to increase its profit margins. Boeing’s prices are also symbolic because airlines usually negotiate for substantial discounts on bulk jet orders.

Boeing spokesman Doug Alder told Reuters that the company was able to bump “the price up because the airplane is in demand,” referring to the 787 Dreamliner, which is an indication of ongoing industry confidence in the plane. Overall, prices rose about 1.6 percent compared with 2012 levels. Yet, that increase was much smaller than the 5.5 percent jump prices made last year.

In particular, the price of all Dreamliner models carry an additional 1 percent increase because the planes are selling well.

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