Boeing Company (the) · NYSE:BA

Boeing Company (the) — Investor Presentation (July 2012)

33 slides from Boeing Company (the)'s investor presentation, July 2012

  1. Slide 1: Current Market Outlook

    Current Market Outlook Randy Tinseth Vice President, Marketing Boeing Commercial Airplanes July 2012 The statements contained herein are based on good faith assumptions and provided for general information purposes only. These statements do not constitute an offer, promise, warranty or guarantee of

  2. Slide 2: Agenda

    Agenda Reminiscing 20-year traffic and airplane forecast Boeing product strategy & development Copyright © 2012 Boeing. All rights reserved.

  3. Slide 3: Copyright © 2012 Boeing. All rights reserved.

    Copyright © 2012 Boeing. All rights reserved.

  4. Slide 4: 1977 vs. today: In-service fleet

    1977 vs. today: In-service fleet Regional Jet Single Aisle Twin Aisle Large 20,000 p • Fleet size has tripled • Twin-aisle market share 15,000 has more than doubled • Average age of fleet has 10,000 increased from 7 to12 years 5,000 0 1977 2011 6,476 19,890 Copyright © 2012 Boeing. All rights reserv

  5. Slide 5: 1977 vs. today: Top airlines

    1977 vs. today: Top 10 airlines United Delta p 10 in 1977 no • 4 of top American United longer in operation Eastern American • Top 10 used to represent TWA Southwest more than one-third of Delta ExpressJet total fleet; now it’s less British Airways FedEx than one-quarter Northwest China Southern • I

  6. Slide 6: 1977 vs. today: 727-200 vs. 737-800

    1977 vs. today: 727-200 vs. 737-800 Copyright © 2012 Boeing. All rights reserved.

  7. Slide 7: 1977 vs. today: Competitive landscape

    1977 vs. today: Competitive landscape 3,000 12,000 55% 50% % g still the • Boeing 2,500 10,000 market leader 2,000 8,000 31% • 5 of top 6 in 1977 30% 6,000 1,500 no longer producing aircraft 1,000 4,000 7% 7% 500 6% 3% 3% 2,000 2% 1% 0 0 * ** 1977 year-end fleet 2011 year-end fleet Includes only “we

  8. Slide 8: 1977 vs. today: Summary

    1977 vs. today: Summary Bigger deeper Bigger, deeper, broader broader, more diverse diverse, resilient market 1977 Today ~6,500 airplanes ~20,000 airplanes North America-centric Diverse, globally balanced Multiple stops Point-to-point Regulated More competition Expensive, p , luxuryy item Affordable

  9. Slide 9: Agenda

    Agenda Reminiscing 20-year traffic and airplane forecast Boeing product strategy & development Copyright © 2012 Boeing. All rights reserved.

  10. Slide 10: Why the Current Market Outlook (CMO)?

    Why the Current Market Outlook (CMO)? Product Long-range Suppliers and strategy gy business p plan airline customers Copyright © 2012 Boeing. All rights reserved.

  11. Slide 11: Market forecast drivers and considerations

    Market forecast drivers and considerations Airplane capabilities Environment High Market Speed liberalization rail Emerging markets Airline Fuel strategies & price business models Economic growth Infrastructure Traffic forecast and network development Annual growth, growth,2009 2012-2031 Annual - 20

  12. Slide 12: Air travel and economic growth are directly related

    Air travel and economic growth are directly related Percent annual change passenger traffic Real GDP growth 16 8 14 7 12 6 10 5 8 4 6 3 Long-term 4 traffic growth 2 2 1 0 0 -2 -1 -4 -2 1971 1976 1981 1986 1991 1996 2001 2006 2011 Pax Airline Traffic Growth GDP Sources: Traffic Growth – ICAO, GDP Gro

  13. Slide 13: Drivers of air travel

    Drivers of air travel Economic Global Traveler growth trade values 60-80% 20-40% Travel Additional demand travel demand Copyright © 2012 Boeing. All rights reserved.

  14. Slide 14: World air travel has grown 5% per year since 1980

    World air travel has grown 5% per year since 1980 6.0 • 4 recessions • 2 financial crises 50 5.0 • 2 Gulf wars • 1 oil shock RPKs (trrillions) 4.0 • 1 near ppandemic (SARS) 3.0 • 9/11 20 2.0 1.0 0.0 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2

  15. Slide 15: 20-year forecast: strong long-term growth

    20-year forecast: strong long-term growth 2011 to 2031 World economy 3.2% (GDP) Number of airline 4.0% passengers Airline traffic 5.0% (RPK) Cargo traffic 5.2% (RTK) Copyright © 2012 Boeing. All rights reserved.

  16. Slide 16: Air travel growth has been met by increased frequencies and nonstops

    Air travel growth has been met by increased frequencies and nonstops World Index 1991=1.00 2.5 Air Travel Growth Frequency Growth 2.0 Nonstop Markets 1.5 1.0 Average Airplane Size 0.5 August OAG All routes Copyright © 2012 Boeing. All rights reserved.

  17. Slide 17: Airlines will need 34,000 new airplanes valued at $4 trillion

    Airlines will need 34,000 new airplanes valued at $4 5 ttrillion $4.5 illi Airplane deliveries: 34,000 Market value: $4.5T 2012 - 2031 2012 - 2031 25 000 25,000 2 500 2,500 Market vvalue, $ billions 20,000 2,000 Airrplane units 15,000 1,500 10,000 1,000 5,000 500 0 0 2,020 23,240 7,950 790 $80B $2,0

  18. Slide 18: Older, less efficient airplanes will be replaced with newer generation airplanes

    Older, less efficient airplanes will be replaced with more efficient, newer generation airplanes 40,000 39,780 30,000 19,890 Growth 59% 34,000 20,000 19,890 , 14,110 Replacement 41% 10,000 5,780 Retained fleet 0 2011 2031 Copyright © 2012 Boeing. All rights reserved.

  19. Slide 19: Emerging markets are driving the economic growth

    Emerging markets are driving the economic growth Annual GDP growth 2011 – 2031 South Asia 7.1 China 6.5 Asia Pacific 4.6 Africa 4.4 Southeast Asia 4.3 Latin America 4.1 Middle East 39 3.9 CIS 3.4 World 3.2 Oceania 2.8 North America 2.6 Europe 19 1.9 Source: Northeast Asia 1.3 IHS Global Insight Copy

  20. Slide 20: Air travel growth varies by market

    Air travel growth varies by market Added traffic Annual 2011 traffic 2012-2031 growth% Asia Pacific* 6.7% Within North America 2.2% 2 2% Within China 6.9% Within Europe 3.5% Europe – Asia Pacific 5 7% 5.7% North Atlantic 3.8% Middle East – Asia Pacific 7.2% T Transpacific ifi 4 8% 4.8% World Average

  21. Slide 21: Air travel becoming more diverse geographically

    Air travel becoming more diverse geographically Air traffic, RPKs (billions) 14,000 Other 12,000 Middle East 10,000 China 8,000 Asia Pacific (excl. China) 6,000 4,000 Europe 40% 2 000 2,000 53% North 72% America 0 1991 2011 2031 Copyright © 2012 Boeing. All rights reserved.

  22. Slide 22: World airlines business model shifts

    World airlines business model shifts World airlines business model shifts 2031 2011 ASMs 2001 3% 3% 8% 14% 19% 3% 24% 23% 56% 60% 22% 65% LCC Charter/IT Broad Network Other Networks Source: Boeing CMOs Copyright © 2012 Boeing. All rights reserved.

  23. Slide 23: Market for new airplanes set to become considerably more geographically balanced

    Market for new airplanes set to become considerably id bl more geographically hi ll bbalanced l d New airplane deliveries by region Market value by region 2012–2031 2012–2031 R i Region Ai l Airplanes R i Region $B 3% 3% Asia Pacific 12,030 Asia Pacific 1,700 6% 3% 7% 3% North America 7,290 North Am

  24. Slide 24: World air cargo traffic has grown 5.5% per year since 1980

    RTKs (billio ons) 0 100 150 200 250 50 1980 1981 1982 1983 * Revenue tonne-kilometers since 1980 1984 Copyright © 2012 Boeing. All rights reserved. 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 World air cargo traffic has grow

  25. Slide 25: Future freighter deliveries will be led by demand for large widebodies

    Future freighter deliveries will be led by demand for l large widebodies id b di New freighter deliveries: 940 Market value: $250 billion 2012–2031 2012–2031 700 72% 250 600 80% 200 Maarket value 500 Airplaane units 400 150 300 28% 100 200 20% 50 100 0 0 680 260 0 $200B $50B $0B Large Medium Standar

  26. Slide 26: New freighter demand - new, converted

    N New ffreighter i ht demand d d -- 940 new, 1 1,820 820 converted t d Share of fleet Delivery units Size category g y Large 2 0 250 >80 tonnes Medium 1,120 40 to 80 tonnes 680 2,760 Standard <45 tonnes 450 260 2011 2031 2012 to 2031 Freighters Freighters Freighters 1,740 3,200 Copyright © 2012 Boei

  27. Slide 27: Agenda

    Agenda Reminiscing 20-year traffic and airplane forecast Boeing product strategy & development Copyright © 2012 Boeing. All rights reserved.

  28. Slide 28: Providing more value to our customers in all markets

    Providing more value to our customers in all markets Environmentally progressive Long‐range, fast, reliable Operational commonality Passenger experience Low operating cost Standardization Copyright © 2012 Boeing. All rights reserved.

  29. Slide 29: Giving each airline the Boeing Edge

    Giving each airline the Boeing Edge Material Fleet Flight Information Copyright © 2012 Boeing. All rights reserved.

  30. Slide 30: Substantial, balanced backlog validates Boeing's product strategy

    Substantial, balanced backlog validates Boeing’s product strategy Backlog ($B) Model 308 747 300 296 Large 279 777 5% Single- 256 Aisle 737 250 38% 250 Twin- 200 Ai l Aisle 57% 787 767 150 Region Leasing, North Gov't & America 100 BBJ L. ME, America Central Ce ta & Africa & S. Asia 50 Asia Pacific E

  31. Slide 31: Things to remember

    Things to remember Today’s market bigger, deeper, broader, more diverse and resilient than 1977 Strong demand for new, efficient aircraft; emerging economies leading growth Boeing’s ’ market-driving products and services provide more value to our customers in all markets Copyright © 2012 Boeing. All

  32. Slide 32: 1977 - a very BIG year

    1977 – a very BIG year • January - record company EMI sacks controversial UK punk rock group the S Pistols Sex Pi t l • February - Fleetwood Mac's Grammy- winning album Rumours is released • April - The Clash's debut album released in the UK on CBS Records • June - The Supremes perform their final c

  33. Slide 33: For more information, please visit our CMO website

    For more information, please visit our CMO website: http://www boeing com/cmo http://www.boeing.com/cmo You can also visit my blog, Randy’s Journal: http://boeingblogs.com/randy/ Copyright © 2012 Boeing. All rights reserved.

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