Leeham News and Analysis

Odds and Ends: KC-46A and Sequester; Stopping Li-Ion fires–or not; Analysts views on FAA action

KC-46A and Sequester: The US House hopes to spare the Boeing KC-46A from Sequester.

Stopping Lithium-Ion Battery Fires: Christine Negroni, who has written for the New York Times and a number of other publications and who has her own blog, Flying Lessons, reports that it’s not possible to prevent lithium-ion battery fires to the one in one billion chances.

Design News has a story that we’re linking here. The story itself is several days old and offers nothing new but its links at the bottom to a series of stories about lithium-ion batteries are what caught our attention and which we thought might be of interest to readers.

Analyst views on the FAA 787 action: Here is what some of the analysts are saying about the FAA clearance for Boeing to proceed with testing the battery solutions:

BB&T Capital

The FAA has officially agreed to test whether Boeing’s redesigned battery system complies with the applicable safety regulations and special conditions. And while the

FAA press release stresses that this approval is only but a “first step” in a process that will involve “extensive testing”, Boeing management’s confidence that (1) their proposed plan will address all of the regulators’ concerns; and (2) the implementation of the fix will be quick once approved by the FAA is sufficient evidence for us to reject our prior thesis that a much longer re-certification process (6 months minimum) is more likely. If all of the FAA’s stringent tests are passed, with no new issues raised, we believe it is fair to assume that this testing could be completed in 5-7 weeks. Accordingly, we are raising our rating from Underweight to Hold.

Bernstein

We do not expect the certification of the new battery design to take a long time. Although the certification plan will require testing and analysis to ensure compliance with the FAA’s safety regulations and special conditions, we understand that some airlines believe 787s could be flying as early as the end of May. Boeing also appears confident that it can meet the FAA’s requirements quickly.

Goldman Sachs

Boeing announced that it has received approval from the US Federal Aviation Administration (FAA) of the company’s plan to test and certify improvements to the 787 battery system. We believe this is an important step towards the resumption of commercial 787 flights and new 787 deliveries. However, a recertification will likely take months to complete and therefore near-term uncertainty also remains on the program.

Imperial Capital

It now appears likely that Boeing will be able to have the grounding lifted on the 787 in May, assuming that there are no issues that arise as part of the re-testing process. The company is stressing that it is a matter of weeks, not months, for the solution to be implemented. We believe that Boeing is close to having production ready batteries that reflect the re-design, considering the number of people Boeing has had in Japan working with the battery supplier on the proposed solution. Next steps for Boeing are to get the current fleet of 50 ready to fly, then incorporate the fix into the current aircraft in inventory so that Boeing can resume 787 deliveries, and then finally work the battery changes into the supply chain for in production aircraft.

• The Wall Street Journal writes, “If all goes well, commercial 787 flights could resume by early May, according to industry and government officials.”