Bad News for The Boeing Company (BA): The Dreamliner’s Battery Is a Nightmare

Fires, fires, everywhere
Boeing’s 787 Dreamliner isn’t alone when it comes to problems with its lithium-ion battery. In 2006, Meggitt plc (LON:MGGT) subsidiary Securaplane Technologies — which incidentally builds the charger for Boeing’s battery — suffered millions in damages when a lithium-ion battery exploded during testing and burned an Arizona facility to the ground.

Further, in both 2010 and 2011, 747 cargo planes carrying pallets of lithium-ion batteries crashed because of a fire, killing the crew.

In neither case could authorities determine a cause for the fire.

In March of this year, Mitsubishi Motors reported two incidents involving a lithium-ion battery. These batteries were manufactured by Mitsubishi’s venture with GS Yuasa, the maker of The Boeing Company (NYSE:BA)’s lithium-ion battery, although the batteries themselves are not the same. Mitsubishi reported that the problem was caused by contaminants getting into the battery cells during the screening process.

Fires ahead for Boeing?
Separately, these incidents are scary but manageable. But when you combine these accidents and factor in the pilots’ concerns, you get the feeling that lithium-ion batteries are anything but safe. Underscoring this point is the decision by EADS’ Airbus to pull the plug on putting lithium-ion batteries in its A350 plane, citing “immaturity of lithium-ion-battery technology.” If the Dreamliner’s battery really is fixed, this plane could prove to be quite profitable for Boeing. However, given all the issues it’s had in the past, and the uncertainty of the battery, investors would do well to keep an eye on the Dreamliner — especially considering Boeing’s stock has risen and fallen right along with the Dreamliner.

The article Bad News for Boeing: The Dreamliner’s Battery Is a Nightmare originally appeared on Fool.com and is written by Katie Spence.

Fool contributor Katie Spence has no position in any stocks mentioned. Follow her on Twitter: @TMFKSpence. The Motley Fool has no position in any of the stocks mentioned.

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