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This Article is From Jan 18, 2013

Boeing liable to compensate Air India for grounded 787 Dreamliners: Civil Aviation Minister

Boeing liable to compensate Air India for grounded 787 Dreamliners: Civil Aviation Minister
New Delhi: Boeing is liable to compensate state-run Air India for the grounding of 787 Dreamliner passenger jets on safety issues, Indian aviation minister Ajit Singh told reporters on Friday.

The lightweight, mainly carbon-composite aircraft has been plagued by mishaps, raising concerns over its use of lithium-ion batteries and forcing many airlines across the globe to ground them.

Poland's state-controlled LOT Airlines earlier said it would seek compensation from Boeing for grounding its two planes.

The US Federal Aviation Administration (FAA) temporarily grounded Boeing's newest commercial airliner on Wednesday, saying carriers would have to demonstrate the batteries were safe before the planes could resume flying. It gave no details on when that might happen.

It is the first such action since the McDonnell Douglas DC-10 had its airworthiness certificate suspended following a deadly crash in Chicago in 1979, analysts said.

Boeing has sold about 850 of its new aircraft, with 50 delivered to date. Around half of those have been in operation in Japan, but airlines in India, South America, Poland, Qatar and Ethiopia, as well as United Airlines in the United States, are also flying the 787, which has a list price of $207 million.

By Boeing's accounting, the 787 program will not be considered profitable until the company has delivered 1,100 Dreamliners. As it stands, the plane accounts for a small portion of Boeing's revenue, given that it produces five of them a month versus 35 for the 737 model.

With most of that Dreamliner fleet now effectively out of action as engineers and regulators make checks, primarily of the plane's batteries and complex electronics systems, airlines are wrestling with gaps in their scheduling.

Japan Airlines Company Limited said it cancelled eight Dreamliner flights between Tokyo and San Diego until January 25, affecting some 1,290 passengers, and would switch aircraft for another 70 flights scheduled to fly the 787. Air India said it would use other planes on scheduled Dreamliner flights.

Qatar Airways, whose Chief Executive Akbar Al Baker had been one of the most outspoken critics of delays and technical problems with the 787, said his airline would ground its fleet of five aircraft. Ethiopian Airlines said its fleet of four Dreamliners had not experienced the same problems as other carriers, but that it would ground the planes nonetheless.

Keeping the 787s on the ground could cost ANA alone more than $1.1 million a day, Mizuho Securities calculated, noting the Dreamliner was key to the airline's growth strategy.

Regulators in Japan and India said it was unclear when the Dreamliner could be back in the air. A spokesman for the European Aviation Safety Agency said the region would follow the FAA's grounding order.

Boeing said in a statement it was confident the 787 was safe and it stood by the plane's integrity.

Passengers leaving United's flight 1426 in Houston, which took off from Los Angeles moments before the FAA announcement, reported an incident-free trip.

"I fly over 100,000 miles a year," said Brett Boudreaux, a salesman from Lake Charles, Louisiana. "That was one of the most relaxing flights I've ever had. I hope they sort it out. It's a hell of a plane."

© Thomson Reuters 2012

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