Premium – Air India, Boeing and the 787

We wonder about the rash of 787 problems that make the news. How bad is it really? According to AeroInside, at this writing, there have been 27 "incidents" with the 787. Of these six are Air India issues. Air India has 12 of the current 121 787s in service. With 10% of the fleet, Air India represents 22% of the incidents. The 787 is new with a host of new features - one expects the settling in process to see incidents. But Air India is out of the norm - it is the only 787 operator which has had a piece of the aircraft fall off because of poor airline maintenance. (picture from IndiaToday.in) We imagine the lip biting in Seattle (and Charleston) when it comes to Air India. The airline has been the most vocal in demanding compensation. Nearly one third of the 787 fleet is based in Japan, and these aircraft have also had glitches, yet the Japanese have been doing their discussions with Boeing quietly. Air India has been offered $23m in compensation of the $46m demanded. Air India continues to use the media as a means to negotiate with Boeing. Norwegian expressed its frustration with very public 787 disruptions, but with none of the heated statements from Air India. Boeing is in a quandary. It dare not throw the customer under the bus, much as they might deserve it. This would reflect badly on the 787 program. Besides India is buying C-17s. Selling these makes up for some of the 787 compensation. Moreover Air India has been a long standing customer. The longevity of the relationship is perhaps seen as less valuable by Air India. Looking at other operators of the 787 (Ethiopian comes to mind), none have had the number of issues as Air India. It would seem the problem is less to do with Boeing and its 787 and more to do with Air India. As a financial disaster (and here), Air India management is focused on the short term and securing more public funding. Air India is the poster child for the argument against state owned airlines. The airline has been a drain on Indian tax payers. The reason the airline stays operating is because India's politicians spend other people's money to ensure they get the travel privileges they want. Now the FAA has asked India to update it's aviation technology. It would seem that Air India is a problem customer. While the 787 has not been a trouble-free aircraft, Air India's mismanagement has probably exacerbated the situation. The question for Boeing may be when a customer turns from an asset into a liability, and whether they are capable of safely operating high technology aircraft.

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