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Originally published January 18, 2013 at 7:23 PM | Page modified January 19, 2013 at 9:34 AM

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Dreamliner’s lure keeps airline CEOs wedded to grounded jet

Some airlines that bought Boeing’s 787 Dreamliner for its long range and industry-leading fuel savings are rallying behind the grounded plane whose fate is bound up with their own.

Bloomberg News

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Some airlines that bought Boeing’s 787 Dreamliner for its long range and industry-leading fuel savings are rallying behind the grounded plane whose fate is bound up with their own.

From American Airlines to lessor CIT Group, customers say they expect a fix for the battery faults keeping the world’s most technologically advanced jet on tarmacs instead of in the skies. The 787 has about 800 unfilled orders.

“These are 30-year decisions airlines are making, and they studied it long and hard before buying,” Michael Derchin, an analyst at CRT Capital Group in Stamford, Conn., said in a telephone interview. “It’s one of the biggest decisions airlines and boards make, and you don’t just casually change airplane orders.”

The Federal Aviation Administration ordered that U.S. Dreamliners be grounded Wednesday, citing fire risk from lithium-ion batteries. Foreign regulators followed, and all 50 of the delivered airplanes are grounded, along with any test flights at Boeing.

The company confirmed Friday it will not deliver any planes until the battery issue is resolved.

Support for the Dreamliner came from carriers such as United, the only U.S. airline now flying 787s, and from those whose Dreamliners are months or years away.

“I have confidence the Boeing Co. will work through the issues with the 787 and that it will be a good airplane,” American Airlines’ Chief Executive Officer Tom Horton said in an interview a day after the FAA acted.

The third-largest U.S. airline expects to complete all of its 100 orders and options for the plastic-composite jet, with deliveries starting in 2014, Horton said.

Jeff Knittel, CIT’s jet-leasing chief, echoed Horton’s support.

“We believe the 787 is a solid aircraft and have every confidence that Boeing will have resolved the issues in advance of our scheduled deliveries in 2015,” said Knittel, whose company has 10 Dreamliners on order.

Some endorsements came with reservations. LOT Polish Airlines, whose first trans-Atlantic flight with a 787 ended with the jet marooned in Chicago by the grounding, said it’s reviewing whether it can seek compensation from Boeing.

That stranding creates a “significant” cost, Tomasz Balcerzak, a member of the management board, said at a briefing in Warsaw, Poland, where LOT is based. The carrier will take its next 787, its third, on the condition that the Dreamliner’s faults are resolved, he said.

In New Delhi, Civil Aviation Minister Ajit Singh told reporters Boeing must pay Air India for losses the state-run carrier is incurring from grounding its 787 fleet. The airline will wait for the U.S. safety review to be completed before seeking damages, he said.

“We have to understand the scale of the problem, the delays it will cause and what impact it’ll have overall,” Singh said.

A carrier that’s tempted to unwind a Dreamliner purchase would risk the financial penalties that typically come with such a move and a struggle to find a different plane when there isn’t an immediate replacement. Airbus SAS’ new A350 isn’t due until 2014, and early delivery slots are taken.

“Is there a risk some airlines might rethink their 787 orders? There is, but I think at this point they won’t act on it,” said Henry Harteveldt, an analyst at Hudson Crossing in San Francisco. “Everything that drew them to the 787 in the first place is still there.”

Even John Leahy, Airbus’ sales chief, agreed. “I don’t believe that anyone’s going to switch from one airplane type to another because there’s a maintenance issue,” he said. “Boeing will get this sorted out.”

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