Japanese airlines: out of charge Just as Japan's airlines were getting off the ground, some dodgy batteries have brought them back to earth again. Third-quarter results this week from All Nippon Airways hinted at the damage its grounded fleet of Boeing's 787 Dreamliners is causing. Japan Airlines - fresh out of a bankruptcy turnround - will reveal the cost of the problem on Monday. ANA said that grounding its 17 Dreamliner planes (almost a tenth of its fleet) has already cost it Y1.4bn ($15m) in lost revenue. Granted, this is just 0.1 per cent of forecast revenue for the year ending in March. But it has stopped investors sharing in the one-fifth take-off in Japanese shares over the past two months, as shares in ANA and JAL traded sideways. Have investors been cautious enough? Dreamliners are an important part of the growth plan for Japan's airline sector. International routes are its fastest growing segment - revenues were up by a tenth in the first nine months from a year earlier, compared with 4 per cent growth domestically. Yet revenues per passenger on international routes are a quarter below domestic ones. Thus Japan's airlines need Dreamliners, which use a fifth less fuel than traditional planes, to boost profitability on those routes. For as long as the planes remain grounded ANA could lose Y1-2bn of operating profit each month, Macquarie calculates. If that is not bad enough, the cost of fuel, set in dollars, is rising as the yen weakens. The price of oil is up by a sixth since June last year. True, this is still a tenth below its recent peak almost a year ago, but the yen has weakened by a sixth against the dollar over the same period. Even if Japan's airlines hedge two-fifths of fuel, as ANA did last year, this will still hurt costs. ANA's operating income was down a fifth from a year ago in the latest quarter and its shares now trade on 14 times forward earnings. That is elevated, unlike many of its planes.