How serious is Boeing’s 787 problem? Gerhard Fasol, chief of the Tokyo-based consulting firm Eurotechnology, takes a pessimistic view.

He believes that one key paragraph in last night’s statement by the Federal Aviation Administration defines Boeing’s problem: “Before further flight, operators of U.S.-registered, Boeing 787 aircraft must demonstrate to the Federal Aviation Administration (FAA) that the batteries are safe.” As Fasol points out, this sets the bar high, given that the 787′s lithium-ion batteries, made by GS Yuasa of Japan, have never before been deployed in a commercial aircraft. “It could be weeks, if not months, before they get to the bottom of this,” he says.

A key part of the problem seems to be that, compared to nickel-cadmium batteries, which have hitherto been standard on commercial jets, lithium-ion batteries require more careful handling. They are more volatile and if overcharged are more prone to causing fires.

So, if these batteries are the root of the problem, why not go back to nickel-cadmium? This unfortunately is easier said than done. For a start it would require major reworking of software and circuitry. Even more problematic, however, is the fact that lithium-ion batteries are much more compact than nickel-cadmium ones. They can store about twice as much energy per unit volume. They also can be moulded to make maximum use of irregular spaces in an aircraft. “As lithium-ion batteries were built into the design from the start, space constraints may make it difficult to revert to more traditional batteries,” says Fasol.

One thing is clear: selling of Boeing’s stock continued today. Meanwhile shares of EADS, the Netherlands-based company that makes Airbus planes, continued their recent outperformance. Compared to last Thursday, Boeing is down 3.5 percent, whereas EADS is up 5.8 percent. As for Thales and United Technologies, two key Boeing suppliers whose inputs may come under scrutiny, their stocks are more or less level over the last week, in line with the S & P index.