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Military

Mounting Airline Losses from 787 Dreamliner Grounding

Photo of Douglas A. McIntyre
By Douglas A. McIntyre Published
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787 With Mt Rainier in DistanceK65116
courtesy Boeing Co.
CEO Jim McNerney said to attendees at Boeing’s (NYSE: BA) annual meeting that “The original promise of the 787 is fully intact.” His comments were premature. Japan’s two largest carriers said that fires started in the Dreamliner’s batteries and the resulting grounding of the plane will affect their financial situations. That means the companies may ask Boeing for compensation.

According to Bloomberg:

ANA Holdings Inc., and Japan Airlines Co., the world’s biggest operators of Boeing Co. 787s, forecast a bigger impact this year from the plane’s grounding as they prepare to start commercial flights with the Dreamliner.

The grounding will cut ANA’s sales by 9 billion yen ($92 million) in the year ending in March, compared with a 7 billion yen reduction a year earlier. Parking of the Dreamliner fleet will pare Japan Air’s operating profit by 2.6 billion yen this year, compared with 1.3 billion yen last year, said Norikazu Saito, a managing executive officer.

McNerney’s optimism about the 787 continues to be misplaced.

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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