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Boeing CEO: 'We Will Get the 787 Back in Service'

Wednesday, 30 Jan 2013 | 3:52 PM ET
Boeing's Q4 Profits Beat the Street
CNBC's Phil LeBeau reports Boeing is standing by its 787, and there is no change in the aircraft's production schedule.

Nearly two weeks after the Federal Aviation Administration grounded the 787 Dreamliner, Boeing Chairman and CEO Jim McNerney is confident they will get the beleaguered line of planes back in the air. "Our first order of business is getting the 787 back into service," said McNerney. "We're all concerned and want to get to the bottom of this quickly."

McNerney made his first public comments regarding the Dreamliner during an earnings conference call with analysts and reporters. Boeing posted better than expected fourth quarter earnings, but it is the outlook for the company's newest plane and whether the lithium-ion batteries it uses to supply electric power on board that dominated questions during the call.

(Read More: Inside Boeing's Rarely Seen Aircraft)

Bloomberg | Getty Images

No Timeframe for Lifting 787 Grounding

McNerney says they are working with investigators from the National Transportation Safety Board and expressed cautious optimism about finding out what exactly caused two Dreamliners to have battery fires earlier this month. "We do believe that good progress is being made in narrowing down potential cause of the events."

Because the Dreamliner is under a federal investigation, McNerney and other Boeing executives are limited in what they can reveal about tests on 787 batteries and components.

More than three weeks after the first incident, investigators are now concentrating on microscopic examination of the lithium-ion batteries in the plane. The NTSB has been working in conjunction with the Japan Transportation Safety Board as that agency investigates the cause of a Dreamliner battery fire on January 16th.

Standing Behind Lithium-Ion Batteries

As the Dreamliner drama has played out, investigators have made it clear they are increasingly focused on the lithium-ion batteries used in the 787.

In both fires, the NTSB found the batteries had short-circuited and suffered from thermal runaway, where the batteries released energy and saw an increase in temperature. It has raised new questions about the reliability of lithium-ion batteries. McNerney understands the concern, but is not changing Boeing's stance on using the batteries. "Nothing we have learned has told us that we have yet that has told us that we have made the wrong choice on the battery technology," said McNerney. "We feel good about the battery technology and its fit for the airplane, we just have to get to the root cause of these incidents and we will take a look at the data as it unfolds, but there is nothing that we have learned that causes us to question that decision at this phase."

(Read More: Boeing Insurer: Too Early to Say How Big 787 Claims Will Be )

All Nippon Airways replaced ten of the lithium-ion batteries in its fleet of Dreamliners between May and December. The airline says some of the batteries experienced unexpectedly low charges while others had experienced "power drops" according to spokesperson for the airline. All of the batteries were returned to the manufacturer, GS Yuasa.

McNerney says the replacement cycle for the Dreamliner lithium-ion batteries is slightly higher than they expected, but none of the batteries have been replaced for safety reasons. "The replacement cycle has been for maintenance," said McNerney

Investors Sticking with Boeing

As McNerney's comments during the conference call came out mid-morning, shares of Boeing started moving higher. Despite the growing concern about a lack of information regarding the 787 investigation, some analysts stood by their belief Boeing will eventually get past this investigation and the Dreamliner will eventually return to the air.

(Click here to get real-time quotes for Boeing.)

—By CNBC's Phil LeBeau; Follow him on Twitter @LeBeauCarNews

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