2023 CMO - Hulst Presentation

Commercial
Market
Outlook
Darren Hulst
Vice President,
Commercial Marketing
June 15, 2023

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Company and shall not be reproduced or disclosed in whole or in part except
when such user possesses direct written authorization from The Boeing Company.
The statements contained herein are based on good faith assumptions are to be
used for general information purposes only. These statements do not constitute
an The
offer,statements
promise, warranty
containedorherein
guarantee of performance.
are based on good faith assumptions are to be
used for general information purposes only. These statements do not constitute
an offer, promise, warranty or guarantee of performance.
Copyright © 2023 Boeing. All rights ©

Copyright reserved. | BOEING
2023 Boeing. PROPRIETARY
All rights reserved. | CSM | |DAH
CSM-PM&A
| CMOROLL| | 01JAN23
15JUN23
Industry recovery progressing broadly as anticipated
CMO 2020 Recovery through April 2023
0%
-20%
RPK vs 2019 in %
-40%
-60%
-80%
Industry Domestic International

-100%
2020 Industry metric 2023

50% Passenger flights 97%
25% Passenger traffic 90%
2023/2024 Passenger recovery 2023/2024
~4% Long-term traffic growth ~4%
Accelerated (4-5%) Airplane retirement outlook Delayed (1-2%)
SOURCE: IATA data through April 2023, compared to April 2019 levels
Copyright © 2023 Boeing. All rights reserved. | CSM | DAH | CMOROLL | 15JUN23
Passenger market nearing pre-crisis levels of activity
Passenger Passenger
fleet (active) capacity
97% 92%
Passenger Passenger
flights traffic
97% 90%
SOURCES: Cirium Fleets Analyzer, FR24, IATA; all values for April 2023 vs. April 2019 Copyright © 2023 Boeing. All rights reserved. | CSM | DAH | CMOROLL | 15JUN23
Single-aisle back to growth, widebody recovery at 85%
Single-aisle Widebody
120 120
100 100
80 80
60 60
40 40
20 20
2015
2019
2023
0 0
Asia Pacific Africa & Europe Americas Asia Pacific Africa & Europe Americas
Middle East Middle East
SOURCE: Cirium Diio, ASMs in billions for June of each year

Economic fundamentals steady despite slowing growth
Consumption… resilient Inflation… improving Financial sector… sound
Policy interest rates

Global CPI
US
US services consumption Eurozone
Japan
2020 2021 2022 2023 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024
SOURCES: US BEA, S&P Global Market Analysis, Boeing Analysis

Demand not constraining recovery
Policy Labor Supply chain

harmonization availability stability
Global middle income household growth supports air travel demand
700
2020 2040
>500 million
600
Household growth in
the “global middle”
500
and above
Households (millions)
400
300
200
100
0
up to 2 2 to 5 5 to 10 10 to 20 20 to 35 35 to 70 70+
Household income (2015 US$ in 000s)
SOURCES: Oxford Economics, Boeing Analysis

Airfares are rising but less than other leisure and travel categories
200
180
160
140
120
100
80
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Airfare Food Lodging Sports Movies

Index (2000 = 100)
SOURCE: US BLS
Air travel adds value on longer trips
Capacity (Available Seat Miles)

140
120
+5.1%
annually
100
80
Billions
>500 miles
60
40
20
0
<=500 miles
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
SOURCES: OAG & Cirium Diio
Airline and network trends
LCC Network Cabin Net

growth flexibility optimization zero
Low cost carriers leading single-aisle fleet growth
LCC
~6X 2042 2.5X
2022
2002
Network
Airlines adapting to evolving demand
% of peak day frequencies
100%
95%
2019 2023
90%
Monday Tuesday Wednesday Thursday Friday Saturday Sunday
SOURCE: Cirium Diio, average seat share of week 3 of each month

Versatility broadening passenger widebody networks
More widebody airports…

628
602
544
500 …across a wide range of missions

400
300
200
100
SOURCE: Cirium Diio, mission distances in kilometers

Airlines deploying more premium cabin seating
Single-aisle Widebody 14%
12%
11%
10%
9%
8%
5% 5%
2019
2023
Domestic
domestic
International
international
Domestic
domestic
International
international
Single aisle Widebody
SOURCE: Cirium
Airlines prioritizing sustainability initiatives
Fleet renewal Increased SAF sourcing Technology investment

Decline in active fleet since 2019
0% 300+ million liters produced
MD80 / 717
A330
in 2022
737NG
A320ceo
-25%
130+ renewable fuel
767
747 / A380
projects announced
-50%
57 offtake agreements
announced since 2022
-75%
SOURCE: FlightRadar24, June 2023 SOURCE: IATA
Fleet trends
Simplification
Pent-up replacement
Regional jet headwinds
Disruptive technology
Airlines simplifying fleets
Number of airplane families removed
3+
2
75
1 airlines phased out
at least one family
from their active fleet
2019 to 2023
SOURCE: Cirium, in-service aircraft for airlines with >30 active airplanes
Fleet renewal underway
Status 2019 Status 2023
In Service
90% In Service
84%
Long storage
Long Storage
New 10%
10%
Retired
Storage Short storage
10% 6%
SOURCES: Cirium Fleets Analyzer and Boeing Analysis
*1% of 2019 has been converted to freighters
Single-aisle fleet renewal gaining momentum
Global scheduled single-aisle capacity (ASKs)
1,500
Current
generation
1,200 21%
Billions
900
600
Recent generation
300
Older generation
0
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
SOURCE: Cirium Diio, ASKs =Available Seat Kilometers
Regional jet capacity challenges
700
Number of routes flown on regional jet by market size
600
500
400 -48%
-14%
300
200 -21% Pre-pandemic
100 Current
0
Small markets Medium markets Large markets
SOURCES: Cirium Diio, US airline majors

Disruptive investment below jet markets
Airport—Airport
>200 miles &
>19 seats
Air Taxis –
Inter Urban
$16 Billion
invested Complementary
applications to airline
business models and
travel experience
Airport—Airport
<200 miles &
Jets and turboprops
<90 seats = ~2% of global,
<19 seats
so minimal impact to
single-aisle jet forecast
METRIC: Share of projects
SOURCES: Roland Berger, McKinsey
Air cargo: long-term growth amid cyclical volatility
35% 75,000
25%
Cargo Tonne Kilometers (CTKs) Change, %
15% 60,000
World CTKs (000)

+3.5%
5%
annually
-5% 45,000
-15%
-25% 30,000
2008 Q1
2009 Q1
2010 Q1
2011 Q1
2012 Q1
2013 Q1
2014 Q1
2015 Q1
2016 Q1
2017 Q1
2018 Q1
2019 Q1
2020 Q1
2021 Q1
2022 Q1
2023 Q1
Trade growth volatile near-term, outperforming GDP over time
Trade +90-95%
3.0% annual growth
GDP +70%
2.6% annual growth
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040
SOURCES: S&P Global GTAS Forecasting, Boeing Analysis

Evolving supply chains
support air cargo growth
250
84%▲
200
East Asia tonnes to US, thousands

150
79%▲ 101%▲
100
50
0
Vietnam Thailand Malaysia
SOURCE: US Department of Commerce

E-commerce boosting express freighter fleets
Added
2019 2020-2022
775
266
20+%
83
growth
6
Freighter aircraft operated by or for express carriers and e-commerce companies
SOURCE: Cirium Fleet Analyzer
Steady long-term forecast driven by fundamentals
World economy (GDP) Passenger traffic (RPKs) Cargo traffic (RTKs) Fleet (jets)
US$92T 6 trillion 260 billion 24,500

2022 2022 2022 2022
US$155T 20 trillion 630 billion 48,600

by 2042 by 2042 by 2042 by 2042
SOURCE: Boeing CMO
Air travel demand drives passenger fleet needs
Increasing regional traffic balance Diverse growth / replacement needs

6,000 14,000
12,000
5,000
2042 fleet
10,000
2042 traffic
4,000
8,000
3,000
6,000
2,000
2022 traffic
4,000
2022 fleet
1,000
2,000
0 0
Americas Eurasia Asia Pac China Africa & Americas Eurasia Asia Pac China Africa &
Middle East Middle East
SOURCE: Boeing CMO
NOTE: Eurasia includes Europe, Russia and Central Asia
Airlines will need 42,595 new airplanes over 20 years
Latin America Africa
32,420
Middle East Eurasia
By region
By type
China
1,810 7,440 925
North America
Regional jet Single-aisle Widebody Freighter
4% 76% 18% 2% Asia Pacific
SOURCE: Boeing CMO Copyright © 2023 Boeing. All rights reserved. | CSM | DAH | CMOROLL | 15JUN23
Future fleet would be ~20% larger without productivity improvements
Higher average seating Increasing total fleet productivity

+7%
300
200 +6%
Fleet
100
2022 2042
0
Single-aisle Small/medium widebody 2022 2027 2032 2037 2042
SOURCE: Boeing CMO
Global fleet will double, with half of deliveries for replacement
50,000
~21,000 48,575
40,000
30,000 ~2,500 excess parked
~21,000
20,000 24,500 (active)
10,000
0
6,000
2022 Fleet Retained Fleet Replacement Growth 2042 Fleet
SOURCE: Boeing CMO
Growing freighter fleet supporting supply chains, express demand
4,000 3,745
Large
650 widebody
3,000
2,270
1,290 2,000
Deliveries Medium
2,825 widebody 1,000
885 Standard-body Fleet
0
2022 2042
Freighters Freighters
SOURCE: Boeing CMO
Growth and replacement drive services and labor needs
$3.8T in Services 2,277,000 New Personnel

Training & Pilot Services
5% Africa & Middle East
13%
Americas
Digital Solutions 24%
& Analytics Parts &
26% Distribution
Services
39%
China
19%
Eurasia
23%
Asia Pacific
Maintenance, Repair, Overhaul & Modifications 21%
30%
SOURCE: Boeing; forecast period 2023-2042
Versatility key to future aircraft market needs
777-9
777-8
787-10
787-9
787-8
737-10
737-9
737-8, -8-200
737-7
100 200 300 400 Seats 500
737 787 777X

the most versatile the only complete the next long-haul
single-aisle family widebody family market leader

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Commercial

June 15, 2023

Copyright © 2023 Boeing. All rights ©

Industry Domestic International

2020 Industry metric 2023

SOURCE: Cirium Diio, ASMs in billions for June of each year

Consumption… resilient Inflation… improving Financial sector… sound

Policy interest rates

SOURCES: US BEA, S&P Global Market Analysis, Boeing Analysis

Policy Labor Supply chain

SOURCES: Oxford Economics, Boeing Analysis

Airfare Food Lodging Sports Movies

Capacity (Available Seat Miles)

LCC Network Cabin Net

SOURCE: Cirium Diio, average seat share of week 3 of each month

More widebody airports…

500 …across a wide range of missions

SOURCE: Cirium Diio, mission distances in kilometers

Single-aisle Widebody 14%

Fleet renewal Increased SAF sourcing Technology investment

Regional jet headwinds

Number of airplane families removed

Global scheduled single-aisle capacity (ASKs)

200 -21% Pre-pandemic

SOURCES: Cirium Diio, US airline majors

World CTKs (000)

SOURCES: S&P Global GTAS Forecasting, Boeing Analysis

East Asia tonnes to US, thousands

SOURCE: US Department of Commerce

US$92T 6 trillion 260 billion 24,500

US$155T 20 trillion 630 billion 48,600

Increasing regional traffic balance Diverse growth / replacement needs

Higher average seating Increasing total fleet productivity

30,000 ~2,500 excess parked

$3.8T in Services 2,277,000 New Personnel

100 200 300 400 Seats 500

737 787 777X

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