5 Min Read
* FAA says manufacturing flaws could lead to engine fires
* United says failed power generator prompted emergency landing
* Analysts see little long-term effect on Boeing from problems
By Alwyn Scott and Karen Jacobs
Dec 5 (Reuters) - Airlines flying Boeing Co's new 787 Dreamliners need to take extra steps to ensure the planes don't have engine failures or fires because of a manufacturing fault in the fuel line, a U.S. regulator said Wednesday.
Improperly assembled parts in Boeing's newest jet could cause the planes to run out of fuel, experience "engine power loss or shutdown, or leaks on hot engine parts that could lead to a fire," the U.S. Federal Aviation Administration said in issuing a formal rule requiring U.S. carriers to inspect the fuel systems.
The fuel issue first emerged Tuesday, the same day a United Airlines 787 flight with 184 people aboard had to make an emergency landing due to an electrical problem.
While the combined episodes gave Boeing a painful black eye, several analysts said the issues posed little long-term risk for the plane maker, which is speeding up production and designing several new derivative jets to better compete with Airbus. Boeing shares fell just 0.2 percent to $73.87.
"There are an awful lot of new features, new technologies and new manufacturing techniques that have produced an enormous number of teething problems, but so far no show stoppers," said Richard Aboulafia, an aerospace analyst with Virginia-based Teal Group.
"We're seeing headaches, not heart attacks."
United said Wednesday that a failed power generator was to blame for the flight from Houston to Newark diverting to New Orleans. It landed safely and there were no injuries.
Five other generators in an aft electrical equipment bay powered the plane after the failure, and there appeared to be no outward signs of trouble, United said.
"The pilots received messages in the cockpit," alerting them to the fault, said Christen David, a United spokeswoman.
Boeing said the issue was not related to what caused an electrical fire in the same location aboard a test plane two years ago. In that case, Boeing has said, a foreign object in an electrical panel had caused arcing that led to the fire.
The fuel problem had been a behind-the-scenes issue for Boeing since Japan's All Nippon Airways found a leak on Oct. 23 and reported it to Boeing and the FAA.
Boeing had issued a notice on Nov. 11 alerting other early 787 customers, which include Qatar Airways, Japan Airlines LAN Airlines, Ethiopian Airlines and Air India.
All Nippon Airways is currently Boeing's biggest 787 operator, owning 16 of the 38 jets delivered to buyers so far. All but one of the planes delivered so far were made at Boeing's factory in Everett, Washington, rather than its plant in North Charleston, South Carolina.
United, the only U.S. carrier flying 787s, said Wednesday it had completed the FAA-mandated inspections.
The fuel leaks were caused by improper assembly of the couplings at the Boeing factories, the FAA said.
"These conditions, if not corrected, could result in fuel leaks, which could lead to fuel exhaustion, engine power loss or shutdown, or leaks on hot engine parts that could lead to a fire," the FAA said.
Boeing said that despite that there were "multiple layers of systems to ensure none of those things happen".
The safety order, known as an airworthiness directive, requires operators to inspect for correctly installed lockwires on the engine fuel line couplings within seven days of its publication.
Within 21 days, operators must inspect the couplings to verify they have been assembled correctly.
Despite the high-profile FAA action, the agency's safety order technically only requires inspections by United. The FAA only has U.S. jurisdiction and no other U.S. airlines currently fly the jet. For future planes, inspections will be performed at the factory. Other aviation regulators were expected to adopt the FAA rule and Boeing said half of the planes already had been inspected.
Aerospace enthusiasts ridiculed the problems on message boards.
"$200 million doesn't get you much reliability these days," said one. Another suggested that the problems in assembly and quality inspection might come from speeding up production. Boeing is aiming to produce 5 Dreamliners a month by year-end, up from 3.5 a month, and to reach 10 a month by next year.
But the episodes appeared unlikely to affect Boeing's 787 order book, said Peter Arment, an analyst with Sterne, Agee & Leach. Boeing will get to the root cause and come up with any needed solutions, he said.
While such circumstances are unexpected, they should not come as a surprise given the revolutionary nature of the plane, Aboulafia, of the Teal Group said.
Airlines will watch closely to ensure aircraft are ready and that corrective measures are taken, given the cost of canceled flights.
"But in terms of doubting what the aircraft can do," he said, "I don't think we're seeing that yet."