Ethopian Airlines Releases Statement On Smoldering Dreamliner; UTX Climate System Implicated In Fire

In the aftermath of the latest humiliation for Boeing, which after getting Dreamliner clearance by absolutely every "authority" imaginable, from the NTSB to the FAA to CNBC's Phil LeBeau, that it was absolutely safe to fry, pardon, fly, just had a major meltdown, oops there we go again, on live TV in Heathrow airport, one wonders - what happens when the regulators rush to give the all clear once more, only for yet another Dreamliner to mysteriously burst in flames several months hence?

Alas that would mean that the very same regulators that lifted the fry, pardon, fly ban on the plane will have to impose it all over again, thus disgracing their pre-clearance methods (likely accelerated courtesy of an occasional envelope full of cash under the door somewhere in the decision chain) even more. And how long until the damage to the brand is so great that Boeing will have no choice but to replace every 8 in its 787 nomenclature with a 9, thus pulling the brilliant GMAC->Ally Bank conversion.

All these are questions that Boeing, the FAA and the NTSB will have to answer very soon, and for the benefit of BA shareholders, with a favorable resolution. Then again, in the matter of recalls, be it of cars or airplanes, the math is well-known...

In the meantime, here is the latest.

Two hours ago, Ethiopian Airlines finally piped in, and on its Facebook page (!) posted the following non-update update:

The above was merely public cover because Mark Mangooni, Ethiopian Airlines' senior manager in Britain, told the Financial that airline staff had discovered a problem with the aircraft's air conditioning system during a routine inspection and had seen sparks but no flames. The report did not make clear when this had happened. Reuters could not reach Mangooni for comment.

In other words, short UTC Aerospace (NYSE:UTX) which is the owner of Hamilton Sundstrand which is the manufacturer of the Dreamliner climate system. At least until such time as the shorting volume dissipates and the BTFD algos return and send the stock right back up.

Elsewhere, investigations have begun. From Reuters.

Investigators started work on Saturday to establish the cause of a fire on a Boeing Dreamliner at London's Heathrow airport, a new setback for the high-tech model after it was grounded at the start of the year over battery problems.


The fire broke out on the plane, operated by Ethiopian Airlines, on Friday afternoon, when it was parked at a remote stand with no passengers on board, eight hours after arriving from Addis Ababa. No one was injured.


External scorching could be seen close to the plane's tail, in a different area from the bays containing batteries. There was no official indication of what could have caused the fire.


"The aircraft has been moved to a secure hangar at Heathrow and the investigation has begun," said a spokesman for Britain's Air Accidents Investigation Branch (AAIB).


The AAIB will lead the investigation, working alongside the U.S. Federal Aviation Administration and National Transportation Safety Board (NTSB), Ethiopian Airlines and Boeing, he said.


Separately, engineers from Britain's Thomson Airways were inspecting their own Boeing Dreamliner after it had to turn back during a flight on Friday from Manchester in England to Sanford in Florida because of an unspecified technical issue.


Boeing will be keen to reassure airlines, travelers and investors over the cause of the Heathrow fire as quickly as possible but under aviation rules it will be up to investigators to decide how much information to release and when.


Ethiopian Airlines, one of Africa's top five carriers, said it would continue to fly its Dreamliner fleet. It has ordered a total of 10 Dreamliners of which four have been delivered.


"The incident at Heathrow happened while the plane was on the ground and had been for more than eight hours and was not related to flight safety," the carrier said in an emailed statement on Saturday.


"After a normal flight from Addis to London passengers disembarked in the morning and the aircraft was cleaned. It was towed to a remote parking area as usual and parked properly with all internal and external powers switched off," said an official from the airline's public relations department.

So first the batteries, then the climate system, what will be the next component in the globally-sourced motley crew assembly to fritz out in what is rapidly becoming the most problematic plane in recent Boeing history?

And how long until the phrase "corporate sabbotage" starts being casually tossed about?


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