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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to http://pennystockpaycheck.com for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Downdraft theory in Lion Air crash

Category : Business

Investigators consider whether powerful ‘wind shear’ or ‘microburst’ caused Bali crash in which all 108 on board survived

The Lion Air pilot whose jet fell into the sea while trying to land in Bali has reportedly described how he felt it “dragged” out of its trajectory and into the water. Investigators are considering whether a powerful downdraft of wind caused the crash in which all 108 passengers and crew survived despite the Boeing 737 cracking in half on impact.

The newly built plane undershot the tourist island’s main airport runway in Denpasar and belly-flopped in water on Saturday. Authorities from Indonesia, the US and Boeing are investigating.

Initial debriefings, witness comments and weather reports have focused attention on the possibility of “wind shear” or a downdraft from storm clouds known as a “microburst”. Experts say such violent and unpredictable gusts are rare but can leave even the most modern jet helpless if they are stronger than the plane’s ability to fly out of trouble – with the critical moments before landing among the most vulnerable.

“If you have a downdraft which exceeds the performance of the plane, then even if you put on full thrust you will go downhill and you can’t climb out,” said Hugh Dibley, a former British Airways captain and expert on loss-of-control events.

The cause of the crash has potential implications for the reputation of one of the world’s fastest-growing airlines, which is fighting to be removed from a European Union safety blacklist just as it buys record volumes of Airbus and Boeing jets.

According to initial pilot debriefings, details of which have been described to the Reuters news agency, flight JT-904 was on an eastwards approach to Bali’s Ngurah Rai airport at mid-afternoon on Saturday following a normal flight from Bandung, West Java.

The co-pilot, an Indian national with 2,000 hours of relevant flying experience, was in charge for the domestic trip, which was scheduled to last one hour and 40 minutes.

As the Lion Air plane was coming in to land, with an aircraft of national carrier Garuda following behind and another about to take off on the runway just ahead, the co-pilot lost sight of the runway as heavy rain drove across the windshield. The captain, an Indonesian citizen with about 15,000 hours’ experience and an instructor’s licence, took the controls.

Between 122 metres and 61 metres altitude (400-200ft) pilots described flying through a wall of water, according to the source. Bursts of heavy rainfall and lost visibility are not uncommon in the tropics but the aircraft’s low altitude meant the crew had little time to react.

With no sight of the runway lights or markings the captain decided to abort the landing and perform a “go around”, a routine manoeuvre for which all pilots are well trained. But the captain told officials afterwards that instead of climbing the 737 started to sink uncontrollably and their well-practised routines unravelled quickly.

“The captain says he intended to go around but that he felt the aircraft dragged down by the wind; that is why he hit the sea,” said the source, who was briefed on the crew’s testimony. “There was rain coming east to west; very heavy,” the source said, asking not to be named because no one is authorised to speak publicly about the investigation while it is under way.

A passenger on board the jet painted a similar picture of an aircraft getting into difficulty only at the last minute. “There was no sign at all it would fall but then suddenly it dropped into the water,” Tantri Widiastuti, 60, told Metro TV.

Lion Air declined to comment on the cause of the crash.

According to the Flight Safety Foundation, bulletins for pilots at around that time indicated a few storm clouds at 518 metres (1,700ft) and a wind blowing moderately but varying in its direction from east-south-east to the west.

The aircraft itself was delivered in February and there had been only one technical problem: a landing light that had to be replaced.

According to Boeing, the 737-800, its most popular current model, is equipped with a system that detects wind shear ahead and warns the pilot audibly to go around.

Monarch rejected our compensation claim for delayed flight

Category : Business

The airline is claiming the aircraft’s technical problems amount to ‘extraordinary circumstances’

My friend and I flew from London to Milan with Monarch Airlines on 21 June last year. There was a technical problem with the aircraft, which meant we eventually left Gatwick more than three hours late.

I wrote to Monarch after I returned from Italy to ask about compensation, but they said they wouldn’t pay any in this case. Then I saw a recent article about the European ruling on flight delays and, on the back of this, formally applied for compensation again a couple of weeks ago. I don’t believe the response I received from Monarch is fair. I don’t think technical difficulties represent an “extraordinary circumstance” as they claim. MD, London

You are not alone in your frustrations: thousands of passengers are currently trying to claim compensation for delayed flights since the law changed – but the response from airlines is mixed. Some people are being awarded the money they are apparently entitled to, some are being turned down.

To clarify, since October 2012 air passengers who have suffered delays of three hours or more at an airport within the EU have been able to claim back as much as £480 plus expenses per person. The claims can be retrospective for up to six years. Airlines can only get out of paying if a delay is caused by “extraordinary circumstances” – essentially, any situation outside their control. However, what appears to be happening is that airlines are routinely citing such circumstances even when there weren’t any.

The Civil Aviation Authority (CAA), which now looks after passenger complaints, says it is seeing many of these cases. It claims that complexities around what exactly constitutes “extraordinary circumstances” can bring a mechanical fault into that category – but not always.

However, last month a raft of changes was unveiled by the European commission aimed at removing “grey areas” in airline passenger rights while flying within the EU. One of the changes seeks to clarify “extraordinary circumstances” for compensation. The updated rules say that only natural disasters and air traffic control strikes can be defined as extraordinary; technical problems identified during routine aircraft maintenance can not.

Although these new rules, if approved by member states, will not become law until 2015, we think you could use the guidance to help argue your case. You should first approach the CAA to look at your complaint – but be warned, because the authority is deluged it is taking weeks, sometimes months, to resolve complaints.

We also know of a number of people who are trying their hand in the small claims court with these claims. We would recommend this route once you have contacted the CAA. A judge in Staffordshire recently awarded a couple £680 after their Thomas Cook flight was delayed in 2009. The couple’s claim had been turned down by the airline.

We welcome letters but cannot answer individually. Email us at consumer.champions@guardian.co.uk or write to Bachelor & Brignall, Money, the Guardian, 90 York Way, London N1 9GU. Please include a daytime phone number

International Airlines Group loses senior executive after union conflict

Category : Business

Boss Willie Walsh replaces Rafael Sánchez-Lozano with Luis Gallego, hated by the company’s workforce

Willie Walsh, boss of the merged British Airways and Iberia, lost one of his senior executives on Wednesday when the head of the Spanish airline stepped down after months of conflict with unions over layoffs.

Rafael Sánchez-Lozano, who had led the airline since 2009, and International Airlines Group (IAG) decided “by mutual agreement” that he would give up his duties as Iberia chief executive and as a board member of the parent group immediately, the company said. It gave no reason for the departure of one of the company’s key figures.

Walsh has replaced him with one of the people most hated by the company’s workforce, Luis Gallego, the chief executive of budget carrier Iberia Express, which is the major source of tension with the company’s workers.

Unions had threatened to hold a total of 15 strike days in February and March, blaming Walsh directly for the company’s apparent inability to negotiate. Strikers carried anti-British placards, claiming Spanish interests had been ignored in the merger.

Clashes with police at Madrid’s Barajas airport in February set the tone of a bruising confrontation that will be difficult to heal, despite a recent compromise deal cutting 3,100 jobs.

Spain’s transport minister, Ana Pastor, had pushed for the deal with unions after warning that the strikes would cause damages of €10m (£8.4m) a day to the recession-struck economy.

Iberia had wanted to sack 3,800 of its 18,000 employees and cut 15% of capacity, including on long-haul routes to Latin America. It had said it needed to “take drastic measures to reduce costs and improve unit revenues in order to remain in business”.

Walsh said Sánchez-Lozano had “led the airline through a very difficult period in the midst of a deep recession and completed the first important step towards returning the airline to profitability”.

He added: “Luis Gallego has extensive experience across a range of international airlines. He was instrumental as chief executive of Iberia Express in creating an airline that is a great success.”

Sánchez-Lozano said: “After reaching agreement with the mediator and the majority of our unions, we have achieved an important milestone as we restructure the airline. The company is now entering a new phase and it is time for me to pass on the baton to my successor.”

Iberia’s bad performance last year drove IAG, which also owns BA, into the red with pretax losses reaching €1bn.

Its operating loss was €351m (£304m) and its struggling performance registered in a €343m writedown that reflected how far its value has fallen since its merger with BA in 2011.

The merger created an airline with 61.5 million passengers flying to 205 destinations worldwide.

Boeing faces more questions as US watchdog investigates battery technology

Category : Business

Investigation into the safety of lithium-ion batteries follows fire on Japan Airlines plane at Boston airport in January

The US’s top aviation safety investigator is to hold hearings on the safety of lithium-ion batteries similar to those used in Boeing’s now grounded 787 Dreamliner jets.

The hearings are likely to put more pressure on Boeing as it fights to get its jets back in the air. Transport secretary Ray LaHood has said plans to fix its battery issues will face “a lot of questions”.

On Thursday, the National Transportation Safety Board (NTSB) released its interim report into the fire that broke out in the battery of a 787 parked at Boston’s Logan airport in January.

Releasing the findings, Deborah Hersman, the NTSB chairman, said she planned to hold a meeting next month to explore lithium-ion battery technology and transport safety. It would help the industry “better understand the risks and benefits associated with lithium batteries, and illuminate how manufacturers and regulators evaluate the safety of new technology,” Hersman said.

She has already criticised the certification process for the battery. “The expectation in aviation is to never experience a fire aboard an aircraft,” she said in January.

Robert Mann, founder of consultant RW Mann, said: “It’s pretty tough to come up with a solution if you haven’t found the cause.” He said the investigation could now widen beyond the battery.

Mann said that the cargo industry had serious concerns about lithium-ion technology and was likely to raise those concerns at the NTSB meeting. A fatal fire broke out on UPS flight in Dubai in 2008 that had been carrying large quantities of lithium ion batteries.

Lithium-ion batteries have caused fires in cars, computers and mobile phones as well as small aircraft. The Dreamliner is the first large passenger jet to use the lightweight technology on such a scale. As well as the Boston fire, a battery in an All Nippon Airways 787 set off a smoke alarm while in flight, triggering an emergency landing. That incident is now being investigated by Japanese authorities.

The delays to 787 deliveries led Boeing rival Airbus to ditch plans to use lithium-ion batteries on its wide-body jet, the A350-XWB.The 499-page report is the most detailed yet into what went wrong. The NTSB report makes clear it has yet to find a root cause for the fire. The board is still early in the investigation into the cause of the blaze on the Boston battery and experts said investigators may never determine a root cause because the battery was so badly burned.

“With the grounding of the 787 fleet, concurrent international incident investigations, redesign and re-certification activities taking place simultaneously, it is essential to provide the aviation community, policy makers and the public with the factual information we are developing,” said Hersman. “Releasing an interim report provides a window into the significant investigative work that has been accomplished so far.”

Boeing had delivered just 50 of its Dreamliner jets when the issue emerged and faces penalties if future deliveries are not made on time. It delivered a plan to address the battery issues to the Federal Aviation Administration (FAA) on 22 February.

That plan is believed to involve a stronger casing for the batteries, reinforced separation between its eight cells and a venting system that would direct potentially hazardous gases outside the jet.

LaHood told the Wall Street Journal that Boeing’s plans would come under intense scrutiny. “I have made it very clear that I want a thorough review” of the Boeing plan, LaHood said. “I am going to ask a lot of questions” before a final decision is made.

Emirates’ concourse for A380s is another staging post on new Silk Road

Category : Business

While the debate rages about airport expansion in Europe, the ambitious Gulf hubs are growing fast – and look set to become the global interchanges of the future

Multiplying lanes, stretching runways and new terminals in the sands may not be everyone’s idea of making the desert bloom. But in Abu Dhabi, where the aviation industry has grown up almost as spectacularly as the skyscrapers on the shoreline, the sheikhs who bankrolled the towering investment do not doubt that the fruits will come.

While London’s great and good grapple with the question of airport expansion, the world beyond is changing, as those running Britain’s biggest airport and airline know all too well – frequently expressing their frustration that rivals are “eating our lunch” and leapfrogging them to aviation’s top spot.

The announcements last week that Etihad Airways – based in Abu Dhabi – was splurging $70m (£47m) to secure three Heathrow slots, while British Airways saw its profits wiped out and its parent company, IAG, record a near-€1bn (£863m) loss, will not have made them much happier.

“In aviation,” says Jos Nuihuis, the boss of Amsterdam’s Schiphol airport, mischievously enjoying his role as the current chief beneficiary of Heathrow’s inability to build another runway, “you have to take the chance when it’s your

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Ryanair takes offer for Aer Lingus to court

Category : Business

Airline takes action after rejection by European officials of its third takeover bid

Ryanair is taking to court its battle to acquire rival Aer Lingus following the rejection of its third takeover bid by European officials. The airline accused the European commission of acting unfairly and failing to apply its own competition rules and precedents to the latest takeover plan.

“We regret that this prohibition is manifestly motivated by narrow political interests rather than competition concerns and we believe that we have strong grounds for appealing and overturning this politically inspired prohibition,” said a Ryanair spokesman. “Accordingly, Ryanair has instructed its legal advisers to prepare a comprehensive appeal against this manifestly unjust prohibition.”

The airline said the bid rejected on Wednesday by the EU, was supported by an unprecedented remedies package. The “radical” bid included two buyers – British Airways and Flybe – agreeing to take over about half of Aer Lingus’s short-haul business.

The takeover plan had been boosted this month when Flybe agreed to fly 43 of Aer Lingus’s short-haul routes, easing competition concerns. There had also been a commitment from International Airlines Group – owner of BA and Iberia – to run overlapping Aer Lingus/Ryanair routes between Dublin and London Gatwick to ensure competition.

Ryanair said the decision to block its latest bid was a political one to protect the interests of the Irish government, which holds a 25% stake in Aer Lingus. The airline submitted its final package of takeover plans and commitments this month following a series of meetings with EU chiefs. It said the package addressed the shortcomings in its two failed bids in 2007 and 2012.

Willie Walsh to axe 4,500 jobs at Iberia

Category : Business

IAG boss on course for another showdown as trade unions respond to announcement with intention of five-day strike action

Willie Walsh is once again on a collision course with his own employees after announcing he will push ahead with plans to axe at least 4,500 staff at British Airways’ sister airline Iberia, prompting trade unions to retaliate by declaring five consecutive days of strike action.

Walsh, chief executive of International Airlines Group – BA and Iberia’s parent, had demanded acquiescence by 31 January to a plan to cut nearly a quarter of Iberia’s workforce. IAG has said the Spanish airline is in a fight for survival, with losses running at around €1.7m (£1.5m) a day, and blames overcapacity and high staff costs. Unions representing Iberia’s ground and cabin crews responded with a pledge to hold strikes over five days later this month.

Walsh said: “We’re disappointed that no agreement has been reached. Iberia is ready and willing to negotiate with the trade unions. We are determined and united to implement the necessary changes to secure the future survival and viability of Iberia.”

He first used the phrase “fight for survival” when he was BA chief executive in 2009, setting the scene for a confrontation with cabin crew over cuts that led to 22 days of strikes the following year.

Iberia on Thursday published an offer it had made to unions to reduce redundancies in return for deeper pay cuts, with pilots losing almost a quarter of their salary. The proposal was not accepted and staff warned that total redundancies could top the 4,500 originally proposed.

IAG said it will start implementing alternative plans, aiming for breakeven by the second half of this year. It is pushing ahead with plans to cut 15% of Iberia’s route network this year, focusing on profitable long-haul flights.

The dispute at Iberia is likely to prove more wounding politically in Spain than the BA cabin crew dispute of 2010 was in Britain. The downgrading of hitherto well-paid jobs and loss of almost a quarter of the workforce at the national carrier will take place against a domestic economic backdrop of a Spanish unemployment rate of around 25%.

Walsh, who forced through a major restructuring at BA to create a new breed of lower-paid, more flexible cabin crew, will not be directly involved in the confrontation in Spain, where resentment has built up against BA since the merger in 2011. Rafael Sánchez-Lozano, Iberia’s chief executive, has also warned that the airline’s future is “bleak” without radical action.

Strikes remain likely. One analyst said: “This could get messy. If I’m a survivor at Iberia, where’s the upside? You can grind people into the ground but you’ve got to show the people the way to the sunny uplands.”

IAG insists “synergies” will prove the logic of the merger by 2015 when Iberia hopes to achieve an acceptable level of profitability, but Walsh does not want the timetable for cost-cutting at Iberia to slip.

Douglas McNeill, investment director at Charles Stanley, said: “There is a high chance that management will prevail in any dispute because they are well prepared. When unions went on strike last January the company was still able to operate the vast majority of its flights and the damage was modest. Its cash reserves are such that it’s something the company can handle. As with BA in 2010, this will be the decisive factor.”

Just over two years since the merger, IAG’s shareholders have seen BA’s new partner drag down the profits. McNeill said: “At the time of this merger, they promised significant results by 2015. In football terms, they are a goal down and it’s half time.”

Boeing’s Dreamliner has to rise again – the future of world aviation needs it

Category : Business

For airlines, fuel efficiency, quietness and a unique range far outweigh a battery problem that will be fixed

As Boeing showed off its multibillion-dollar baby on the Dreamliner’s promotional world tour in 2011, one quirky feature was regularly pointed out: a sleekly designed but redundant ashtray, a compliance with regulations laid down in a different age. In the darkest torments of Boeing executives during the past few incident-packed weeks, it may have finally appeared of use: somewhere to enjoy the cigarette of the condemned, a quiet smoke to mask the smell of burning battery.

A little over a week ago, America’s government and air authorities stood shoulder to shoulder with their top exporter, Boeing, to assure the world that the plane was safe after a string of incidents from fuel leaks, windscreen cracks and battery fires. They still say it – only, right now, that no one should fly in it.

By Wednesday, a diagnosis of teething problems was no longer enough. The burning battery was back, and Japanese authorities said the latest incident was “highly serious”. Corrosive fluid had leaked down through the state-of-the-art electronics below the cockpit. Hideyo Kosugi, a Japanese safety investigator surveying the All Nippon Airways 787 that had made an emergency landing at Takamatsu airport, said the stuff had gone right through the floor.

After the Japanese airlines operating almost half of the Dreamliners worldwide decided they could risk it no longer, the US Federal Aviation Administration grounded all 787s in its jurisdiction. From India to Qatar, Poland to Chile and finally Ethiopia, the global fleet was taken out of action, an ignominious fate for a plane that had been so eagerly anticipated for so very long.

In an industry where different models are normally denoted by numbers alone, naming the 787 the Dreamliner was to invite attention: a bold statement that this was to be something fundamentally different. This craft does not simply carry the commercial aspirations of Boeing; it has become symbolic of aviation’s promises for a greener, quieter future.

For passengers, there was the thrill of bigger windows, funky lighting and increased cabin pressure, said to reduce the ill-effects of flying. Thomson, the first UK customer, has built an ad campaign around it. But for airlines, the critical selling point was fuel efficiency, where the airline executives’ and the environmentalists’ interests briefly coincide.

While rivals mutter that the aspirations have yet to be matched in operations, the lighter plane promised a 20% cut in the soaring fuel bills that have wiped out profits for many airlines.

The Dreamliner also promised a range unique for an aircraft of its size, potentially making direct flights to long-haul destinations viable with fewer passengers, not least, the secondary cities in the emerging Bric economies – Brazil, Russia, India and China – to which business people in the UK apparently clamour to fly.

Improvements in those spheres are by no means unique to the Dreamliner. But perhaps more than any other plane, it has come to represent the technological innovation that the aviation industry claims will allow it to meet its wider obligations to the world: that we can fly and not fry, even with ever more flights.

A carbon dioxide “roadmap” produced by Sustainable Aviation, an industry group addressing environmental issues, sees the fuel efficiencies delivered by the 787 and its successors as a way to cut about a third of all projected carbon emissions, a major part of a plan that would let traffic double by 2050 and still meet the emissions targets aviation signed up to in the wake of the Kyoto climate negotiations.

For airports in Britain’s crowded south-east, the Dreamliner is also a name to conjure with. Briefly in operation here since Qatar Airways’ inaugural flight just before Christmas, it claims a “noise footprint” some 60% smaller than other planes its size. Around Heathrow, such contours spell votes: Boris Johnson has spoken of 750,000 Londoners having their lives blighted by aircraft noise

As Howard Davies’s commission sits down to reflect over the next two and a half years on the future shape of Britain’s airport capacity, Heathrow will want to demonstrate that noise is not a insurmountable political obstacle. Current proposals from the Department for Transport, penned before Justine Greening was shuffled out of the department, will ramp up the fines for louder planes: Virgin’s Richard Branson has suggested banning noisy aircraft from the airport – but then his airline has 16 Dreamliners arriving from next year.

So Boeing’s problems are aviation’s problems too. Little wonder that few airlines, beyond the annoyance of those already operating the now-grounded 787, have offered anything but unqualified support and confidence. With 799 aircraft outstanding, the order book dwarfs the 50 in service. The ambitions of the fleet planners everywhere for new routes and for lower overheads hang on the 787s rolling out of the Seattle factory.

Observers have little doubt that the Dreamliner will fly again. Douglas McNeill, investment director at Charles Stanley, says: “It will get fixed. Boeing just has no alternative – it’s just a question of how much time and money it takes. If it’s just the battery, it could be relatively simple. If it’s an overhaul of the whole onboard power generation, it’s a time-consuming and costly task.”

If safety has always been paramount, the industry is taking absolutely no chances in preserving its proud boast; according to the International Air Transport Association, 2012 was the safest year on record. McNeill dismisses safety fears: “It would be more than odd, it would be astonishing if there was an issue that escaped the hundreds of thousands of hours of testing that Boeing and the FAA carried out.

“It’s hard to imagine the Dreamliner not re-entering service quickly, but in the worst-case scenario it could have a real impact. It was going to be a big step forward in terms of noise and emissions.”

Not everything hinges on the Dreamliner: rival Airbus has the A350 coming down the line, also built with composite materials and lithium-ion batteries. It has often been described as Airbus’s answer to the Dreamliner, although the European manufacturer is quick to point out that its design – and batteries – are very different to Boeing’s plane.

There was no hint of schadenfreude from boss Fabrice Brégier at last week’s Toulouse event when Airbus announced a record year for aircraft deliveries – though second to Boeing in orders. In the long term, the efficiencies will come: concerns about the new technology may again hold up the process more than those worried by climate change or the bottom line would hope. “Airbus and Boeing will need to get these planes into service,” McNeill adds.

Boeing meanwhile has said it will do all it can to restore confidence. Chief executive Jim McNerney pledged to “work around the clock” with investigators, adding: “We will make available the entire resources of the Boeing company to assist.” For a corporation the size of Boeing, worth around £50bn even with its shares sliding, the current problems should amount to little more than a spot of turbulence. Airbus quickly recovered confidence and orders despite cracks in the wings of its pioneering A380 in 2011. Boeing’s bosses will hope that the Dreamliner can swiftly rise above its current problems and return to the skies.

America joins Japan in grounding Boeing 787 Dreamliners

Category : Business

Influential US regulator the FAA joins Japan in taking troubled planes out of service, followed by India and Chile

American regulators followed the lead of Japanese airlines by grounding the Boeing 787 Dreamliner on Wednesday night, saying a recent series of safety incidents meant urgent action was needed.

The US Federal Aviation Administration (FAA) said it would require airlines to demonstrate that the plane’s cutting-edge batteries were safe before allowing further flights. It has notified regulators in other countries of its action.

Japan’s two leading airlines, All Nippon Airways (ANA) and Japan Airlines, had already grounded their fleets of Boeing 787s after one of the Dreamliner passenger jets made an emergency landing, the latest in a series of incidents that have heightened safety concerns over a plane that many see as the future of commercial aviation.

After the FAA announcement, India and Chile were the next countries to move. Air India spokesman K Swaminathan said India’s aviation authority had directed the state airline to stop flying the Boeing planes on Thursday morning as it waits for an investigation by Indian regulators to take place. “Air India has temporarily ceased operation of its Dreamliners,” Swaminathan said.

Chile’s LAN airline said it was suspending flights of its three Dreamliners in compliance with the FAA directive.

The European Aviation Safety Agency (EASA) and other air safety authorities around the world are likely to bring in similar measures now that the FAA has intervened. A spokesman for EASA told the Reuters news agency that it would usually follow safety directives if they were issued in a country where the aircraft was built. “In this case we have issued no airworthiness directive so far, so the FAA’s directive should be endorsed by EASA,” the spokesman said.

In one show of faith, Poland’s LOT airlines sent one of its two Dreamliners on its maiden transatlantic flight from Warsaw to Chicago, to the reported disquiet of some passengers interviewed. LOT is the only airline within the jurisdiction of EASA that has taken delivery of the 787 so far.

Other countries whose airlines use the 787 are Ethiopia and Qatar.

ANA said instruments aboard a domestic flight indicated a battery error, triggering emergency warnings. The incident was described by a transport ministry official as “highly serious” – language used in international safety circles as indicating that there could have been an accident. Boeing shares fell 2% in after-hours trading to $72.80 (£45.50) after the FAA announcement.

Its move came as American safety investigators were due to fly to Japan on Thursday to liaise with Japanese counterparts.

ANA and Japan Airlines have 24 Dreamliners between them, representing almost half of the 50 delivered by Boeing to airlines worldwide. Last week the FAA announced a full review of the revolutionary plane’s design and manufacture after five incidents in five days on different planes in Japan and the US. These included a battery fire, fuel leakages from engines, and cracks developing in the cockpit windscreen.

Given the Dreamliners’ significantly greater fuel efficiency than most models, airlines have been queuing up to buy a model that promises greener, quieter – and cheaper – aviation.

The aircraft’s design also makes emerging long-haul destinations feasible with fewer passengers. In Britain, British Airways, Thomson and Virgin have placed orders, with BA expecting to operate the first of its 24 Dreamliners this year.

Production problems drastically held up delivery of the aircraft: it first entered service in late 2011, four years after the first 787 was unveiled. Issues have since been reported with the plane in India and Qatar. While analysts say such “teething problems” are not uncommon, Boeing will be acutely aware that rival Airbus has the new A350 coming to offer an alternative for airlines updating their fleets.

Aviation consultant John Strickland said: “This story is going to run on for Boeing. The key thing is that the Dreamliner 787 is so leading edge.”

The Seattle-based manufacturer may be facing a repair bill to rival the £200m costs Airbus incurred as a result of cracks in the wings of the A380 in 2011. : “Boeing is aware of the diversion of a 787 operated by ANA to Takamatsu in western Japan. We will be working with our customer and the appropriate regulatory agencies.”

787 emergency landing: Japan grounds entire Boeing Dreamliner fleet

Category : Business

Plane makes emergency landing at Takamatsu airport, western Japan, in latest safety scare for troubled new aircraft

Japan’s largest airline, ANA, and its competitor JAL have each grounded their entire fleet of Boeing 787 Dreamliners after an emergency landing due to a smoke alarm in the cockpit – the most dramatic of a spate of incidents involving the troubled aircraft over the past week and since its inception.

All Nippon Airways said the plane’s eight crew and all 129 passengers had evacuated safely on inflatable slides. Instruments in the cockpit indicated there had been a battery malfunction and the pilot had noticed a strange smell.

ANA said the plane diverted to Takamatsu, western Japan, at 8.45am on Wednesday. It had been bound for Haneda airport in Tokyo.

A spokesman for the Osaka airport authority said the plane had left Yamaguchi at 8am and made the emergency landing after the smoke alert.

The incident is certain to rock global airlines’ confidence in the new aircraft, which went into commercial service just over a year ago after a three-year delay caused by design and production problems. 

In the aftermath of the emergency landing, both ANA and JAL said they were grounding all their Dreamliners until satisfied they are safe to fly. The incidents have caused particular concern in Japan, the Dreamliner’s biggest market, with ANA and Japan Airlines (JAL) flying 24 of the 50 planes to have rolled off the production line so far.

ANA is the biggest operator of the 787 in the world so far, having taken delivery of 17 aircraft including the first one flown commercially.

The aircraft has been hit by half a dozen incidents in the past week, including two fuel leaks, a battery fire, a wiring problem, a brake computer fault and a cracked cockpit window. Before that there had been engine failures during testing and in one case a Dreamliner cargo plane was forced to cancel takeoff when one of its General Electric turbines lost power.

US aviation officials say the aircraft is safe and it is not unusual for new models to experience minor mishaps, but the recent incidents have inevitably raised questions over the Dreamliner’s safety. More than 800 Dreamliners have been ordered by airlines around the world.

The aircraft was supposed to have heralded a new era in commercial flight. Boeing officials say the plane, which is made of carbon fibre and other lightweight materials, is 20% more fuel-efficient than conventional airliners and 30% cheaper to maintain, and features design improvements for more comfortable medium and long-haul flights.

Boeing spokesman Marc Birtel told Reuters: “We’ve seen the reports, we’re aware of the events and are working with our customer.” 

On Tuesday Japan’s transport ministry said it was launching an investigation into the cause of two fuel leaks on a JAL Dreamliner. That came after US transport authorities and Boeing started a joint investigation into the aircraft’s manufacturing, design and assembly.

“Looking at this from the point of view of average citizens, having these sort of incidents occur seemingly day after day, one could become very uneasy,” Akihiro Ota, Japan’s transport minister, told reporters.

“We plan to look into the scale of these accidents and what the overall situation is. We will convey the message to those who operate [the plane] that it is absolutely necessary to be safe.”