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THE BOEING COMPANY 2021 ANNUAL REPORT Forward, Together “With revitalized spirit and an unwavering commitment to transparency in all we do, we are transforming to be a better, stronger Boeing, propelled by the spirit of innovation that has been our hallmark for more than a century.” DAVID L. CALHOUN President and CEO THE BOEING COMPANY STAKEHOLDER-DRIVEN TRANSPARENCY CONTENTS As a leading global aerospace company, Boeing develops, manufactures and services commercial airplanes, defense products and space systems for customers in more than 150 countries. As a top U.S. exporter, the company leverages the talents of a global supplier base to advance economic opportunity, sustainability and community impact. Boeing’s diverse team is committed to innovating for the future, leading with sustainability, and cultivating a culture based on the company’s core values of safety, quality and integrity. Learn more at boeing.com. Boeing is committed to transparency. Through our annual disclosure and reporting cycle, we compile and share a broad set of data, information and operating examples for our stakeholders, including our employees, customers, industry partners, investors, regulatory authorities, communities and others. Using the most widely applicable disclosure frameworks, Boeing reports each year on our financial performance and company priorities; our employee demographics and progress toward achieving equity, diversity and inclusion commitments; our sustainability-focused environmental, social and governance performance; our community investments and advocacy; and our industry-leading aerospace market outlooks. A Letter From Boeing President and CEO David L. Calhoun 1 Revolutionizing How We Operate 6 Embracing Unique Perspectives 7 Safely Returning to Service 8 Diversity in Action 10 Sustainable Aerospace 11 Global Solutions for Global Needs 12 Driven by Purpose 14 Executive Council 15 Company Highlights 16 COVER PHOTO Dave Ieng (right) and Michael Bundy conduct checks on a 777X airplane at Boeing Field in Seattle. Known as WH001, the airplane is one of four 777-9s in a rigorous test program. To view our Annual Report online, along with additional 2021 Boeing milestones, scan the QR code with your smartphone. Form 10-K 17 Caution Concerning Forward-Looking Statements 144 Non-GAAP Measures 145 Selected Programs, Products and Services 146 Shareholder Information 156 Board of Directors 157 Company Officers 158 All photography was conducted in compliance with applicable COVID-19 requirements. 90120_cover.indd 4 3/3/22 4:41 PM A Letter From Boeing President and CEO David L. Calhoun 2021 was a year of recovery, rebuilding and resilience for our industry and for The Boeing Company. Our progress and milestones steadfastly reinforced our highest priority —enabling the safety, security and protection of everyone we serve. We made significant strides toward strengthening our safety culture, investing in our talent and instilling renewed discipline and rigor throughout our operations. I am extremely proud of our team’s accomplishments and resolve in building a healthier and stronger company. We know that our industry is a resilient one. Together with our customers and partners, we are charting the course for recovery as we innovate for a brighter, sustainable tomorrow. Ongoing COVID-19 Recovery The world at large navigated a second consecutive year of the COVID-19 pandemic and its wide-ranging social and economic impacts on businesses and the ways we work. In the latter part of the year, surges of the Delta and Omicron variants came about fast and strong, necessitating ongoing changes in COVID-19 requirements and guidance in varying measures across the globe. Through it all, we worked diligently and collaboratively across the industry advancing our Confident Travel Initiative (CTI), further enhancing health safeguards for air travel. We remain inspired by the critical work of the CTI team as they actively lead the global conversation on the safety of air travel amid COVID-19, applying proven aerospace engineering practices and data to develop new solutions. The commercial market continues to improve, enabled by wider vaccine distribution and an encouraging increase in travel demand, particularly in domestic markets. We look to the next phase of recovery in regional markets followed by long-haul international routes. The commercial services market began to rebound as air travel returned and customers utilized faster procurement channels to place e-commerce parts orders. We witnessed the ongoing human impact of the virus globally and the toll it has taken on our local communities. Boeing, and its 142,000 teammates around the world, are grateful for the efforts of all first responders, healthcare workers and researchers who continue to keep us all safe where we live and work. I am humbled by our Boeing teammates who find ways to overcome the challenges of the pandemic and support our local communities in need, while ensuring we deliver products and services to our customers with utmost safety, quality and transparency. Rebuilding Trust We profoundly committed to regaining the trust of our customers, regulators, investors and other key stakeholders through transparency, integrity and 1 737 MAX 2021 MILESTONES Global regulators and aviation organizations from around the world collaborated to allow the airplane to safely return to service. JANUARY FEBRUARY MARCH European Union Aviation Safety Agency (EASA) and U.K. Civil Aviation Authority approvals for 737 MAX return to service Air Canada, United Airlines and TUI return 737 MAX to service Australia Civil Aviation Safety Authority approval Investment firm 777 Partners orders 24 737-8s Alaska Airlines introduces 737 MAX into service Southwest Airlines orders 100 737-7s and 737-8s Southwest Airlines returns 737 MAX to service Federal Aviation Administration certifies 737-8-200 UAE General Civil Aviation Authority approval delivering on what we promise. With an unwavering dedication to safety, our 737 program teammates have been working around the clock globally to support our customers as they return airplanes back to service. Regulators in 185 out of 195 countries—including China, Ethiopia and Indonesia—have allowed the 737 MAX to resume service or fly within its airspace. from our enterprise transformation initiative to drive simplification and stability across our operations. By the end of 2021, our actions, coupled with market recovery, helped generate positive operating cash flow in the fourth quarter—a key financial milestone —and builds on our path to sustainable cash generation in the years ahead. Since its return to service starting in late 2020 through the end of 2021, the 737 MAX made nearly 300,000 revenue flights for 35 operators, accounting for 720,000 flight hours with more than 99% schedule reliability. In addition, we delivered 272 737 MAX airplanes over that period and we’re poised to continue steadily increasing production. Market Opportunity and Increasing Cargo Demand Boeing is navigating the 787 Dreamliner return to delivery with the same disciplined approach as we did with the 737 MAX return to service. We are actively and transparently communicating with our regulators, customers and suppliers every step of the way as we move closer to delivering airplanes and bringing more predictability and stability to the program for the long-term. The in-service 787 fleet continues to satisfy customers and outperform in the market as the most utilized widebody during the pandemic — with nearly 99% of in-service 787s returning to revenue service compared to prepandemic levels. With safety and quality guiding our recovery, we prudently managed our financials and began to see the results 2 Our 2021 Boeing Market Outlook projects a $9 trillion market opportunity over the next decade for aerospace products and services. At the end of 2021, we had a backlog valued at more than $377 billion—including approximately 4,200 commercial airplanes—demonstrating Boeing’s comprehensive product and services lineup to meet this demand. Supply chain disruptions and limited cargo belly capacity on passenger planes due to the pandemic, as well as increasing e-commerce, has led to an increase in near-term cargo demand, including dedicated freighters—both new and converted models. Longterm, we project the global freighter fleet in 2040 will be 70% larger than the prepandemic fleet, continuing to be driven in part by e-commerce. To satisfy global demand from operators worldwide, we announced plans to increase freighter conversion capacity with the addition of 10 conversion lines across new and existing maintenance, repair and overhaul suppliers. APRIL EASA certifies 737-8-200 flydubai and Turkish Airlines return 737 MAX to service JUNE AUGUST SEPTEMBER NOVEMBER Flair Airlines introduces 737 MAX into service India Directorate General of Civil Aviation (DGCA) approval Civil Aviation Authority of Malaysia approval Akasa Air orders 72 737 MAX airplanes Civil Aviation Authority of Singapore approval SpiceJet returns 737 MAX to service 737-10 first flight Ryanair introduces 737-8-200 into service United Airlines orders 200 737 MAX airplanes We booked record orders in 2021 for new and converted Boeing freighters, including 84 orders for our 767, 777 and 747 freighters. As air traffic rebounded and operators looked for more efficient ways to procure parts and service for their fleets, Boeing also reached a record high for e-commerce parts sales in a single year with more than $2 billion in 2021. Defense, Space and Security Missions Boeing’s Defense, Space and Security portfolio continues to deliver on its mission to equip the U.S. government and allied nations with the latest advanced technologies and products. We are focused on providing our security customers—who require speed and flexibility—digital solutions and cutting-edge products and platforms that meet the growing demand in the global security market. In 2021, we delivered 169 total aircraft including Norway’s first P-8A Poseidon and the first KC-46A tanker to the Japan Air Self-Defense Force. The KC-46A has been approved by the U.S. Air Force to refuel almost 70% of receiver aircraft and is successfully flying refueling missions with operators —delivering more than 60 million pounds (27 million kilograms) of fuel to a wide range of aircraft. Our commitment to support our space mission with uncrewed and crewed flights of the CST-100 Starliner remains steadfast, and we continue to work closely with NASA as we go forward. South Korea Ministry of Land, Infrastructure and Transport approval Progress on Development Programs Our defense development programs are making good progress, as we successfully completed the first carrier tests with the U.S. Navy for the MQ-25 uncrewed aerial refueler and started flight testing on the second uncrewed Airpower Teaming System. We are also integrating our learnings from the defense programs into our commercial development process. As proudly featured on our front cover this year, the 777X made its international debut at the Dubai Airshow in November—the first inperson international air show since the height of the pandemic. We continue to guide the airplane through a comprehensive and rigorous test program to demonstrate its safety, performance and reliability as we engage with the FAA and global regulators on our progress, and look forward to delivery of the first airplane. Our customers recognize the compelling economics and sustainability benefits—including 10% 10 percent improvement improvement in fuel efficiency in fuel efficiency and and emissions emissions over over the competition—of the competition— of the the 777X, 777X, which which willwill bebe thethe world’s world’s largest and most efficient twin-engine jet. We are also excited to have launched the latest member of the 777X family, the 777-8 Freighter, with an order for up to 50 from launch customer Qatar Airways. Throughout our development process, we are considering the full life-cycle of our products and services in close DECEMBER Singapore Airlines returns 737 MAX to service Civil Aviation Administration of China approval Indonesia DGCA approval Civil Aviation Authority of Vietnam approval collaboration with our customers in order to offer mutually-beneficial solutions. In doing this, we are developing new ways to share data through a digital thread that will integrate our products, customers and suppliers. We are utilizing new innovation and digital enablement as a strategic capability during the development of new products and services. We are also advancing our development of the 737-7 and 737-10. The 737-7, the smallest airplane in the 737 MAX family, has completed its flight test program. Boeing is now working with the FAA to complete all deliverables for type certification. The 737-10, the largest airplane in the 737 MAX family which can carry up to 230 passengers, completed a successful first flight in June. Our Digitally-Enabled Future In September, Boeing launched an integrated approach to all digital efforts to support our next suite of products within a digital ecosystem. This fully dedicated team is creating the digital environment where the next new airplane and production system can be designed together, providing significant benefits in first-time quality throughout the design and manufacturing process. This digital environment will provide connectivity for data-driven decision making from design and production to manufacturing and services. The effort builds upon years of learnings from programs across Boeing, including the first digitally designed aircraft developed for the 3 United States Air Force, the T-7A Red Hawk. Our production line employees on the T-7A already attest firsthand that their experiences working in this digital, collaborative environment are favorable. bold climate change ambitions. We support our industry’s commitment to achieve net zero carbon emissions by 2050 and are already partnering across the sector to decarbonize. While the initial intent is to leverage the team to inform digital development of the next commercial airplane, the work to increase data collaboration across the entire company will support development, production, and manufacturing in our defense and services businesses as well. The actions we have already taken include our commitment to deliver commercial airplanes that will be capable of flying on 100% sustainable aviation fuels by 2030. Additionally, we recently announced a further investment in Wisk Aero to advance its 6th generation electric vertical take-off and landing (eVTOL) aircraft. Wisk, a joint venture established in 2019 by Boeing and Kitty Hawk Corporation, is dedicated to delivering safe, everyday flight for everyone. We’ll continue to share the progress we make through our annual Sustainability Report, which we published for the first time in 2021, underscoring our commitment to advancing sustainable aerospace for the greater good of our customers, our industry and the environment. Sustainable Aerospace At Boeing, sustainability is rooted in our values, our stakeholders’ expectations, and encompasses our focus on environmental stewardship, social progress and inclusion, and valuesbased, transparent governance. As a company whose purpose is to protect, connect and explore our world and beyond, we fully support the importance of safe and sustainable aerospace. We envision that by 2050 air travel will carry more than 10 billion passengers a year, and support 180 million jobs, safely and sustainably. We are collectively inspired and motivated by a united purpose —enabling all of humanity to take flight safely, including the 80% of people around the world who have yet to take their first flight. At the same time, commercial and defense customers and governments around the globe are committing to 4 “It’s said that we are what we repeatedly do, and that excellence is therefore not an act but a habit. The challenges we are working through today on the 787 program will position us for sustained excellence and success in the long term.” MATTHEW BUCALO 787 Chief Mechanic Our Culture of Inclusion Our teammates collaborate to make the world better—creating powerful technologies, services and products that connect the globe, protect freedoms and borders, and advance scientific discovery from the seabed to deep space. Our ability to innovate and achieve success depends on our diverse, global team working together, supporting one another and living our values. To learn more about equity, diversity and inclusion at Boeing in 2021, scan the QR code with your smartphone. More than 10,000 employees each year receive tuition assistance through Boeing’s industry-leading Learning Together Program, including Nelson Akwari (right), who earned his PhD in Materials Science and Engineering in 2021. Akwari’s innovative work at Boeing is also being recognized by the National Society of Black Engineers, with Pioneer of the Year and Distinguished Engineer of the Year awards. Across Boeing, we are committed to investing in our teams’ career development and fostering an atmosphere where all teammates can bring their whole selves to work and grow in their Boeing careers with opportunities to develop and make an impact. This longstanding promise to our team is especially critical as the competition for talent grows increasingly fierce. We also continue to focus on growing and developing our engineering talent pipeline. The work we do across commercial, space, defense and services changes the world—and our engineers are at the forefront. As we build a more inclusive workplace, it is important for all voices to be valued and heard every day. We encourage employees, managers and colleagues to seek, speak and listen in all interactions, and when challenges arise, reach out and ask questions to get to the heart of the matter. It’s through this openness that we better communicate, operate, and innovate as a company. We will continue to share progress on our commitment to advance equity, diversity and inclusion within Boeing and beyond as seen in our first Global Equity, Diversity & Inclusion Report, released in 2021. As we further transform for the future, this work is foundational to our company values and central to our business strategy for the long-term. “Furthering my education with this benefit Boeing offers was a rewarding experience that allowed me to hone my skills, providing more perspective on critical problem solving and investigating theoretical data.” NELSON AKWARI Operations Superintendent & Site Leader, Boeing Interiors Responsibility Center South Carolina Making a Difference Globally Moving Forward, Together When U.S. forces pulled out of Afghanistan at the end of August, the digital flight solutions offered by Global Services played a vital role in the massive operation that evacuated more than 124,000 people from the Kabul airport. Every single country that operated flights into and out of Kabul during the airlift effort utilized Boeing’s Military Digital Solutions. Looking ahead, Boeing is focused on driving stability and making the right investments to ensure we are well-positioned for future growth. With safety at the forefront, our effort to stabilize our production system, including the supply chain, and improve our delivery predictability, remain important priorities as we continue to invest in our people, technology, manufacturing capabilities, and strategic partnerships. We are thankful for the courage of the men and women of the military from the U.S. and from allied nations that led evacuation efforts on the ground. We are proud to have played a role in supporting them with unique requirements for various aircraft. Our Global Services team helped increase the payload to accommodate extra passengers on the Royal Australian Air Force’ C-17 Globemaster III aircraft and improve confidence in certain key components of the United Kingdom’s fleet of C-17s. Boeing employees also delivered navigation and data products for other aircraft in the U.S. Air Force and U.S. government’s Civil Reserve Air Fleet. These key moments are among many stories that reinforce the impact our people, products and services can have on the world. It’s indicative of the culture we continue to cultivate at Boeing, one of care for our teammates, our customers and humanity. It’s what inspires us every day. The past several years have been challenging; however, they have made us stronger as a company and as an industry. We are part of a rich and proud legacy that drives us forward every day. With revitalized spirit and an unwavering commitment to transparency in all we do, we are transforming to be a better, stronger Boeing, propelled by the spirit of innovation that has been our hallmark for more than a century. Thank you for your continued confidence in our company. It’s my privilege to be on the Boeing team as we work with our customers and stakeholders to move forward, together. David L. Calhoun President and CEO 5 Each of us has a hand in our revitalization. Revolutionizing How We Operate Shaping Our Future The Boeing T-7A Red Hawk team is revolutionizing the way aircraft are built at the St. Louis production facility. The team uses advanced digital design techniques and model-based engineering that have resulted in a vast improvement in quality. Boeing’s Digital Transformation team is using lessons learned here and in other programs such as the MQ-25 to lead a shift that will allow the company to shape 6 the future of engineering and lifecycle support through model-based, connected design and data-driven support methodologies. The goal is to reinvent how to work across the entire Boeing value stream, leveraging a collaborative, digital environment where products and systems can be designed, tested, built and supported hundreds of times in the virtual world to ensure first-time quality and optimal readiness in the real world. “Having worked on programs where I had to drill and countersink holes in airframes, I doubted whether assembling an aircraft with prefabricated sections would be precise enough to pass our rigorous quality inspections. I soon realized the quality has actually improved and it’s not as demanding physically. I don’t think we will ever go back to the old way of building aircraft.” WILL HELTON T-7A Aircraft Mechanic And everyone has a story to tell. Embracing Unique Perspectives Ambassadors for Compliance and Integrity How we do our work is just as important as the work we do; the way for us to grow, increase our customers’ confidence, and honor our company’s legacy is by performing with integrity. That is why we launched an Ethics Ambassador Program. Our ambassadors are embedded within the business to foster a culture of compliance, amplify our values, listen to concerns, and elevate issues. “I take pride in being a voice for our values and a trusted ear for my colleagues in helping to identify any emerging issues. When employees speak up, we improve as a company, and it is important to ensure everyone feels comfortable raising issues.” CHRISTINE VASKO Boeing Ethics Ambassador Diversity of Thought Through the Confident Travel Initiative (CTI) we continued collaborating with airline customers, industry associations, academic and medical institutions, government agencies and worldwide policymakers as part of the global effort to provide passengers and crew a safe, healthy and efficient travel experience. “Our Boeing team has been committed to sharing our CTI research to support the global effort to keep air travel passengers safe amidst challenges posed by COVID-19.” DR. LINDSAY L. JONES Associate Technical Fellow, Applied Mathematics 7 Safely Returning to Service Maintaining and Servicing Boeing employees, including the Winglet team in Moses Lake, Washington, have been putting in long hours to protect 737 airplanes in storage, prepare each airplane for customer delivery and support operators once their airplanes enter into service. The Customer Support team that has been at the forefront of the 737-8 and -9 return to service efforts, also provided proactive advice and solutions. The Customer Support team also works around the clock, monitoring fleetwide performance, diagnosing issues, and providing solutions for airline customers from Operations Centers in Seal Beach, California, and Everett, Washington. Spanning all aerospace engineering disciplines, the team has also assisted airline partners to resume and expand service as part of the recovery in the wake of the COVID-19 pandemic. The team’s 24/7 presence allows Boeing to deliver world-class support and ensure that airlines and operators can safely and confidently operate their airplanes from across the commercial fleet. Collaborating With Regulators Thanks to agile collaboration among Boeing teams and the Civil Aviation Administration of China, the 737 MAX completed the simulator and certification validation flight tests required to return to Chinese skies. The certification validation flight test was the first Boeing has ever conducted outside the U.S. “What we achieved by bringing the flight test to China has all kinds of firsts and meaning for Boeing in so many ways.” SHERRY CARBARY President of Boeing China 8 United in Our Mission United Airlines announced an order to expand its fleet with 200 737 MAX jets, including 150 737-10 and 50 737-8 airplanes. “We expect the addition of these new aircraft will have a significant economic impact on the communities we serve in terms of job creation, traveler spending, and the shipping of goods and services.” SCOTT KIRBY United Airlines CEO 9 Diversity in Action Reaching New Heights In October 2021, a Boeing team successfully completed a regular developmental flight test of the company’s 737-10 airplane. Yet this flight test was different from all the previously recorded ones before it: The Boeing colleagues who conducted this flight were all women. “Everyone on board was responsible for safely executing, monitoring and analyzing test conditions, and each played a pivotal role. This is what is possible when you pay attention to diversity and inclusion.” JENNIFER HENDERSON Commercial Airplanes Production Chief Pilot and Pilot in Command of 737-10 Test Flight Inclusion Makes Us Better Our global team continues to advance equity, diversity and inclusion within Boeing and beyond. In 2021, we published our diversity metrics for the first time in Boeing’s history, built inclusive habits called Seek, Speak & Listen, and furthered our equity strategy with the support of our Racial Equity Task Force. Our ongoing commitment earned Boeing the No. 17 ranking on the 2021 DiversityInc Top 50 list, the Department of Labor’s Hire Vets Platinum Medallion Award, a 100 score on the Human Rights Campaign Corporate Equality Index and more. “Protecting, connecting and exploring our world requires a diverse team that embraces challenges to advance our mission. The Seek, Speak & Listen habits have taught us that our collective intelligence is so much greater than the sum of its parts. When we support each other, when we seek diverse perspectives and listen with curiosity, we achieve the unimaginable.” SARA BOWEN Vice President, Global Equity, Diversity & Inclusion 10 Sustainable Aerospace To learn more about sustainability initiatives at Boeing, scan the QR code with your smartphone. Fueling Sustainable Air Travel Minimizing aerospace’s impact on our planet requires a multifaceted global approach and partnerships. Whether we are testing new technologies on the ecoDemonstrator program, ensuring we deliver commercial airplanes that are ready to fly on 100% sustainable aviation fuels by 2030, or finding more efficient ways for our commercial and defense customers to operate their fleets, we are committed to doing our part to decarbonize global civil aviation operations by 2050. “Strong partnerships are essential because advancing sustainability is a team sport and requires action collectively across the aviation value chain.” VALENTINA VECCHIO Strategic Engagement & Execution Lead, Global Sustainability Policy & Partnerships Future of Mobility “Boeing’s close partnership with Wisk is an opportunity to harness our vast engineering know-how combined with Wisk’s innovative self-flying eVTOL technology to achieve this next giant leap in aviation, always leading with safety.” BRIAN YUTKO Vice President and Chief Engineer, Sustainability and Future Mobility Courtesy: Wisk Aero Wisk is an incredibly exciting technology venture that will pioneer one of the world’s first zero-emissions, autonomous commercial aircraft and bring sustainable flight closer to home for millions of people around the world. 11 Images courtesy: U.S. Air Force Global Solutions for Global Needs Protecting Heroes and Saving Lives As part of a contract with the U.S. Department of Defense, Boeing Global Services teams will continue to enable the C-17 Globemaster III’s worldwide mission readiness, which includes critical sustainment in the field. performance in the recent airlift of more than 124,000 evacuees from Afghanistan in an around-the-clock operation. AMC looks forward to the continued partnership with our Boeing teammates as we work to keep the Globemaster fleet healthy for years to come.” “The C-17 continues to serve as the strategic airlift workhorse for the nation, as evidenced by its impressive BRIG. GEN. DARREN COLE U.S. Air Force Air Mobility Command (AMC) Director of Logistics, Engineering and Force Protection 12 Top: Civilians inside a C-17 Globemaster III, as the U.S. Air Force evacuated them from Kabul, Afghanistan, in August during one of the largest air evacuations of civilians in history. Bottom: A C-17 in flight. Converting to Meet a Need Boeing logged record orders and commitments for Boeing converted freighters, which remain in high demand for vital supply chain operations and for express and e-commerce logistics. To meet customer demand amid the COVID-19 pandemic, the program is expanding capacity at existing maintenance, repair and overhaul (MRO) supplier facilities in the Asia-Pacific region and is adding new conversion sites in the Americas and Boeing’s own London Gatwick facility. “At the end of the day, I look around and see packages being delivered and know that my work contributes to this with a versatile freighter that is serving routes across five continents.” ANTHONY CHAU Liaison Engineer, Flight Test and Modifications Enabling Critical Relief In addition to a $10 million assistance package for COVID-19 relief in India, Boeing worked with health care providers to support vaccination drives and find medical care for employees when hospital beds were in short supply. “When I learned Boeing was helping build a COVID-19 field hospital in Bengaluru and in places that didn’t have medical resources, I felt a weight lift off my shoulders. Seeing a piece of barren land transform into a fully equipped facility in less than a month was truly an example of how we can help our communities. My son proudly says now that his dad works for a company that builds aeroplanes and hospitals.” To learn more about our global engagement in 2021, scan the QR code with your smartphone. JONAS PRASANNA Senior HR Generalist, Boeing India 13 Driven by Purpose On a Mission to Protect The Boeing Airpower Teaming System (ATS), also known as Loyal Wingman, is a first-of-its-kind uncrewed system designed to fly autonomously alongside crewed aircraft and perform a range of missions. Developed by Boeing Australia teams and the Royal Australian Air Force (RAAF), two aircraft completed first test flights in 2021. “The close collaboration with the RAAF allows us to rapidly design and develop innovative solutions and digital engineering technologies.” SIMON JACOMBS Engineering Manager, ATS Boeing’s Soaring With Your Dream educational program in China continues to create meaningful STEM connections, training more than 120 teachers to reach students at more than 30 additional schools in 2021. Boeing volunteers used enhanced training systems to encourage teachers to embed STEM activities into their curriculum. The program received recognition at the 2021 CSR China Education Awards and also made the CSR China Top 100 list. The program is in place in more than 1,600 Chinese schools, with more than 3,700 teachers participating to date. Courtesy: YouChange Foundation STEM Career Connections Committed to Explore “We create space systems that connect and protect people globally and enable exploration of other worlds.” JIM CHILTON Senior Vice President, Space and Launch 14 Courtesy: NASA/Frank Michaux From the Space Launch System Artemis undertaking to return us to the moon, Starliner’s mission to transport crews to the International Space Station, and cutting-edge products and solutions being provided to the U.S. Space Force, Boeing is advancing a new chapter that underscores its commitment to human space exploration. Executive Council Stanley A. Deal Executive Vice President; President and CEO, Boeing Commercial Airplanes Leanne G. Caret Executive Vice President; President and CEO, Boeing Defense, Space & Security Theodore Colbert III Executive Vice President; President and CEO, Boeing Global Services Brian J. West Executive Vice President; Chief Financial Officer Gregory L. Hyslop Chief Engineer; Executive Vice President, Engineering, Test & Technology Michael D’Ambrose Chief Human Resources Officer; Executive Vice President, Human Resources Brett C. Gerry Chief Legal Officer; Executive Vice President, Global Compliance Ziad Ojakli Executive Vice President, Government Operations B. Marc Allen Chief Strategy Officer; Senior Vice President, Strategy and Corporate Development Michael A. Arthur Senior Vice President; President, Boeing International Edward L. Dandridge Chief Communications Officer; Senior Vice President, Communications Susan Doniz Chief Information Officer; Senior Vice President, Information Technology & Data Analytics Uma Amuluru Chief Compliance Officer; Vice President, Global Compliance Michael Delaney Chief Aerospace Safety Officer; Senior Vice President, Global Aerospace Safety David A. Dohnalek Senior Vice President; Treasurer Chris Raymond Chief Sustainability Officer; Vice President, Global Enterprise Sustainability William A. Ampofo II Vice President; Chair, Supply Chain Operations Council Elizabeth Lund Senior Vice President; Chair, Program Management Operations Council Carole A. Murray Vice President; Chair, Quality Operations Council William H. Osborne Senior Vice President; Chair, Manufacturing Operations Council 15 Company Highlights We made tremendous progress on the 737 MAX return to service effort, delivering 272 airplanes since the ungrounding in November 2020 and steadily increasing production. Our Global Services business is well positioned for growth. As cargo demand expands, we booked record orders for new and converted Boeing freighters. We also announced plans to add 10 additional converted freighter lines at new and existing MRO suppliers. In our defense and space business, we secured key orders and delivered on critical customer milestones. Given our steadfast focus on safety, quality, integrity and sustainability, we are confident in our company’s future and optimistic about the industry’s recovery. PRODUCT AND SERVICES MILESTONES Boeing Commercial Airplanes Boeing Defense, Space & Security Boeing Global Services • Factory improvements in safety and quality • F-15EX Eagle II first flight and delivery • T-7A Red Hawk production began • $2 billion e-commerce parts milestone reached faster than ever before • Garnered more orders than competition, including in the 737 market segment • Airpower Teaming System (Loyal Wingman) first flight • C-17 sustainment with U.S. Air Force extended up to $23.8 billion • 737-10 first flight • MQ-25 became first uncrewed aircraft to refuel another aircraft • Ground broken on new MRO facility in Jacksonville, Florida • Successfully conducted the Space Launch System Green Run hot fire test • Announced plans to add 10 additional freighter conversion lines at new and existing MRO suppliers • 777X international debut at Dubai Airshow • Made significant progress on 737 MAX return to service (185 countries clear operations; 720,000 flight-hours through end of 2021) and preparations for rate increase • Successful ecoDemonstrator program in partnership with Alaska Airlines • 787 final assembly consolidated to Boeing South Carolina • Boeing delivered Block III F/A-18 Super Hornet to U.S. Navy • U.S. Air Force provided operational approval to KC-46 to refuel almost 70% of receiver aircraft, and completed first international delivery to Japan FINANCIAL OVERVIEW 2021 2020 2019 2018 2017 Revenues 62,286 58,158 76,559 101,127 94,005 (Loss)/earnings from operations (2,902) (12,767) (1,975) 11,987 10,344 Diluted (loss)/earnings per share (7.15) (20.88) (1.12) 17.85 13.85 Operating margins (4.7%) (22.0%) (2.6%) 11.9% 11.0% Core operating (loss)/earnings* (4,075) (14,150) (3,390) 10,660 8,906 Core operating margins* (6.5%) (24.3%) (4.4%) 10.5% 9.5% Core (loss)/earnings per share* (9.44) (23.25) (3.47) 16.01 12.33 Operating cash flow (3,416) (18,410) (2,446) 15,322 13,346 Contractual backlog 356,362 339,309 436,473 462,070 456,984 Total backlog† 377,499 363,404 463,403 490,481 474,640 U.S. dollars in millions, except per share data * Non-GAAP measures. See Page 145. † Total backlog includes contractual and unobligated backlog. See Page 31 of Form 10-K. COMPARISON OF CUMULATIVE* FIVE-YEAR TOTAL SHAREHOLDER RETURNS $250 Company/Index Base Period 2016 2017 Boeing 100 194.77 217.23 S&P 500 Aerospace & Defense 100 141.38 S&P 500 Index 100 121.83 Years Ending December 2018 2019 2020 2021 224.46 148.38 139.55 $150 129.97 169.39 142.18 160.98 $100 116.49 153.17 181.35 233.41 $50 *Cumulative return assumes $100 invested; includes reinvestment of dividends. 16 $200 $0 16 The Boeing Company 17 18 19 S&P 500 Aerospace & Defense 20 21 S&P 500 Index UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 ☐ or TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-442 THE BOEING COMPANY (Exact name of registrant as specified in its charter) Delaware 91-0425694 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) I 100 N. Riverside L Plaza, Chicago, (Address of principal executive offices) 60606-1596 (Zip Code) Registrant’s telephone number, including area code (312)-544-2000 Securities registered pursuant to Section 12(b) of the Act: Common Stock, $5.00 Par Value (Title of each class) BA (Trading Symbol) New York Stock Exchange (Name of each exchange on which registered) Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐ Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large Accelerated Filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ As of June 30, 2021, there were 585,875,929 common shares outstanding held by nonaffiliates of the registrant, and the aggregate market value of the common shares (based upon the closing price of these shares on the New York Stock Exchange) was approximately $140.4 billion. The number of shares of the registrant’s common stock outstanding as of January 24, 2022 was 582,999,765. DOCUMENTS INCORPORATED BY REFERENCE Part III incorporates information by reference to the registrant’s definitive proxy statement, to be filed with the Securities and Exchange Commission within 120 days after the close of the fiscal year ended December 31, 2021. THE BOEING COMPANY Index to the Form 10-K For the Fiscal Year Ended December 31, 2021 PART I Item 1. Item 1A. Item 1B. Item 2. Item 3. Item 4. Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mine Safety Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 1 7 20 21 21 21 PART II Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 6. [Reserved] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 7A. Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . Item 8. Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 9A. Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 9B. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 5. 22 22 23 56 57 132 132 132 PART III Item 10. Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . Item 11. Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 13. Certain Relationships and Related Transactions, and Director Independence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 14. Principal Accountant Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133 136 Item 15. Exhibits, Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 16. Form 10-K Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 141 142 137 137 138 PART IV PART I Item 1. Business The Boeing Company, together with its subsidiaries (herein referred to as “Boeing,” the “Company,” “we,” “us,” “our”), is one of the world’s major aerospace firms. We are organized based on the products and services we offer. We operate in four reportable segments: • Commercial Airplanes (BCA); • Defense, Space & Security (BDS); • Global Services (BGS); • Boeing Capital (BCC). Commercial Airplanes Segment This segment develops, produces and markets commercial jet aircraft and provides fleet support services, principally to the commercial airline industry worldwide. We are a leading producer of commercial aircraft and offer a family of commercial jetliners designed to meet a broad spectrum of global passenger and cargo requirements of airlines. This family of commercial jet aircraft in production includes the 737 narrow-body model and the 747, 767, 777 and 787 wide-body models. Development continues on the 777X program and certain 737 MAX derivatives. Defense, Space & Security Segment This segment engages in the research, development, production and modification of manned and unmanned military aircraft and weapons systems for strike, surveillance and mobility, including fighter and trainer aircraft; vertical lift, including rotorcraft and tilt-rotor aircraft; and commercial derivative aircraft, including anti-submarine and tanker aircraft. In addition, this segment engages in the research, development, production and modification of the following products and related services: strategic defense and intelligence systems, including strategic missile and defense systems, command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR), cyber and information solutions, and intelligence systems, satellite systems, including government and commercial satellites and space exploration. BDS’ primary customer is the United States Department of Defense (U.S. DoD). Revenues from the U.S. DoD, including foreign military sales through the U.S. government, accounted for approximately 84% of its 2021 revenues. Other significant BDS customers include the National Aeronautics and Space Administration (NASA) and customers in international defense, civil and commercial satellite markets. This segment’s primary products include the following fixed-wing military aircraft: F/A-18E/F Super Hornet, F-15 programs, P-8 programs, KC-46A Tanker and T-7A Red Hawk. This segment produces rotorcraft and rotary-wing programs, such as CH-47 Chinook, AH-64 Apache and V-22 Osprey. Unmanned vehicles include the MQ-25, QF-16 and Insitu’s Scan Eagle aircraft. In addition, this segment’s products include space and missile systems including: government and commercial satellites, NASA’s Space Launch System (SLS), the International Space Station, Commercial Crew, missile defense and weapons programs and Joint Direct Attack Munition, as well as the United Launch Alliance joint venture. 1 Global Services Segment This segment provides services to our commercial and defense customers worldwide. BGS sustains aerospace platforms and systems with a full spectrum of products and services, including supply chain and logistics management, engineering, maintenance and modifications, upgrades and conversions, spare parts, pilot and maintenance training systems and services, technical and maintenance documents, and data analytics and digital services. Boeing Capital Segment BCC seeks to ensure that Boeing customers have the financing they need to buy and take delivery of their Boeing product, while managing overall financing exposure. BCC’s portfolio consists of equipment under operating leases, sales-type/finance leases, notes and other receivables, assets held for sale or re-lease and investments. Intellectual Property We own numerous patents and have licenses for the use of patents owned by others, which relate to our products and their manufacture. In addition to owning a large portfolio of intellectual property, we also license intellectual property to and from third parties. For example, the U.S. government has licenses in our patents that are developed in performance of government contracts, and it may use or authorize others to use the inventions covered by such patents for government purposes. Unpatented research, development and engineering skills, as well as certain trademarks, trade secrets and other intellectual property rights, also make an important contribution to our business. While our intellectual property rights in the aggregate are important to the operation of each of our businesses, we do not believe that our business would be materially affected by the expiration of any particular intellectual property right or termination of any particular intellectual property patent license agreement. Human Capital The COVID-19 pandemic continues to impact lives and businesses around the world. We have taken proactive steps to help protect the health and safety of our employees and maintain business continuity. As COVID-19 vaccines became available, we strongly encouraged employees to get vaccinated when eligible, followed federal and state government vaccination requirements, provided resources and support to help employees get vaccinated, offered paid time off for primary and booster vaccinations, and supported vaccination clinics for our employees and their families. We provided access to virtual primary care physicians at no cost. We expanded our virtual work options and many of our office workers continue to telecommute. We have maintained safety protocols at our sites, including face coverings, physical distance requirements and enhanced cleaning requirements. We continue to encourage daily self-health checks and operate our coronavirus hotline, which enables employees to report exposure to COVID-19 and positive COVID-19 test results directly to our Health Services group. As part of that reporting process, we have a robust contact tracing program to identify those who have been in close contact in the workplace with employees who have tested positive for COVID-19. All of the actions above are overseen by Boeing’s Crisis Management Working Group, a multi-functional, multi-discipline team tasked with integrating all aspects of Boeing’s COVID-19 response. As of December 31, 2021, Boeing’s total workforce was approximately 142,000, with 12% located outside of the U.S. 2 As of December 31, 2021, our workforce is composed of approximately 47,000 union members. Our principal collective bargaining agreements were with the following unions: Union The International Association of Machinists and Aerospace Workers (IAM) Percent of our Employees Represented Status of the Agreements with Major Union 20% We have two major agreements; one expiring in July 2022 and one in September 2024. The Society of Professional Engineering Employees in Aerospace (SPEEA) 10% We have two major agreements expiring in October 2026. The United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) 1% We have one major agreement expiring in October 2022. We aspire to be the most equitable, diverse and inclusive company. Guided by our values, we are committed to creating a company where everyone is included and respected, and where we support each other in reaching our full potential. We are committed to diverse representation across all levels of our workforce to reflect the vibrant and thriving diversity of the communities in which we live and work. In June of 2021, we released our first Global Equity, Diversity and Inclusion report with our workforce composition. As of December 2020, our U.S. workforce was comprised of approximately 23% women, 31% racial and ethnic minorities and 15% veterans. We also support Business Resource Groups open to all employees with more than 13,000 participants across 150 chapters globally that focus on gender, race & ethnicity, generations, gender identity, sexual orientation, disability or veteran status. These groups help foster inclusion among all teammates, build awareness, recruit and retain a diverse workforce and support the company in successfully operating in a global, multicultural business environment. We are committed to releasing a Global Equity, Diversity and Inclusion report in 2022 which will be updated with 2021 information. Our 2021 report can be found on our website. To attract and retain the best-qualified talent, we offer competitive benefits, including market-competitive compensation, healthcare, paid time off, parental leave, retirement benefits, tuition assistance, employee skills development, leadership development and rotation programs. In 2021, our voluntary resignation rate was approximately 4%. Additionally, we hired approximately 9,800 new employees in 2021 for critical skills and had an offer acceptance rate of 83%. Employees are encouraged to provide feedback about their experience through ongoing employee engagement activities. Boeing actively listens to its employees via surveys ranging from pre-hire to exiting the company. These voluntary surveys provide aggregate trend reports for the company to address in real time and ensure Boeing maintains an employee-focused experience and culture. We also invest in rewarding performance and have established a multi-level recognition program for the purpose of acknowledging the achievements of excellent individual or team performance. We are committed to supporting our employees’ continuous development of professional, technical and leadership skills through access to digital learning resources and through partnerships with leading professional/technical societies and organizations around the world. For 2021, Boeing employees consumed approximately 3.6 million hours of learning. We offer the ability for our people to pursue degree programs, professional certificates and individual courses in strategic fields of study from more than 300 accredited colleges and universities, online and across the globe through our tuition assistance program. Over 10,000 Boeing employees leverage these programs every year. 3 Safety, quality, integrity and sustainability are at the core of how Boeing operates. We aspire to achieve zero workplace injuries and provide a safe, open and accountable work environment for our employees. We provide several channels for all employees to speak up, ask for guidance and report concerns related to ethics or safety violations. We address employee concerns and take appropriate actions that uphold our Boeing values. Competition The commercial jet aircraft market and the airline industry remain extremely competitive. We face aggressive international competitors who are intent on increasing their market share, such as Airbus and other entrants from Russia, China and Japan. We are focused on improving our processes and continuing cost reduction efforts. We intend to continue to compete with other airplane manufacturers by providing customers with higher quality products. BDS faces strong competition in all market segments, primarily from Lockheed Martin Corporation, Northrop Grumman Corporation, Raytheon Technologies Corporation, General Dynamics Corporation and SpaceX. Non-U.S. companies such as BAE Systems and Airbus Group continue to build a strategic presence in the U.S. market by strengthening their North American operations and partnering with U.S. defense companies. In addition, certain competitors have occasionally formed teams with other competitors to address specific customer requirements. BDS expects the trend of strong competition to continue into 2022. The commercial and defense services markets are extremely challenging and are made up of many of the same strong U.S. and non-U.S. competitors facing BCA and BDS along with other competitors in those markets. BGS leverages our extensive services network offering products and services which span the life cycle of our defense and commercial airplane programs: training, fleet services and logistics, maintenance and engineering, modifications and upgrades, as well as the daily cycle of gateto-gate operations. BGS expects the market to remain highly competitive in 2022, and intends to grow market share by leveraging a high level of customer satisfaction and productivity. Regulatory Matters Our businesses are heavily regulated in most of our markets. We work with numerous U.S. government agencies and entities, including but not limited to, all of the branches of the U.S. military, NASA, the Federal Aviation Administration (FAA) and the Department of Homeland Security. Similar government authorities exist in our non-U.S. markets. Government Contracts. The U.S. government, and other governments, may terminate any of our government contracts at their convenience, as well as for default based on our failure to meet specified performance requirements. If any of our U.S. government contracts were to be terminated for convenience, we generally would be entitled to receive payment for work completed and allowable termination or cancellation costs. If any of our government contracts were to be terminated for default, generally the U.S. government would pay only for the work that has been accepted and could require us to pay the difference between the original contract price and the cost to re-procure the contract items, net of the work accepted from the original contract. The U.S. government can also hold us liable for damages resulting from the default. Commercial Aircraft. In the U.S., our commercial aircraft products are required to comply with FAA regulations governing production and quality systems, airworthiness and installation approvals, repair procedures and continuing operational safety. New aircraft models and new derivative aircraft are required to obtain FAA certification prior to entry into service. Outside the U.S., similar requirements exist for airworthiness, installation and operational approvals. These requirements are generally 4 administered by the national aviation authorities of each country and, in the case of Europe, coordinated by the European Union Aviation Safety Agency. Environmental. We are subject to various federal, state, local and non-U.S. laws and regulations relating to environmental protection, including the discharge, treatment, storage, disposal and remediation of hazardous substances and wastes. We could also be affected by future laws and regulations relating to climate change, including laws related to greenhouse gas emissions. These laws and regulations could lead to increased environmental compliance expenditures, increased energy and raw materials costs and new and/or additional investment in designs and technologies. We continually assess our compliance status and management of environmental matters to ensure our operations are in compliance with all applicable environmental laws and regulations. Investigation, remediation and operation and maintenance costs associated with environmental compliance and management of sites are a normal, recurring part of our operations. These costs often are allowable costs under our contracts with the U.S. government. It is reasonably possible that costs incurred to ensure continued environmental compliance could have a material impact on our results of operations, financial condition or cash flows if additional work requirements or more stringent clean-up standards are imposed by regulators, new areas of soil, air and groundwater contamination are discovered and/or expansions of work scope are prompted by the results of investigations. A Potentially Responsible Party (PRP) has joint and several liability under existing U.S. environmental laws. Where we have been designated a PRP by the Environmental Protection Agency or a state environmental agency, we are potentially liable to the government or third parties for the full cost of remediating contamination at our facilities, former facilities or third-party sites. If we were required to fully fund the remediation of a site for which we were originally assigned a partial share, the statutory framework would allow us to pursue rights to contribution from other PRPs. For additional information relating to environmental contingencies, see Note 13 to our Consolidated Financial Statements. Non-U.S. Sales. Our non-U.S. sales are subject to both U.S. and non-U.S. governmental regulations and procurement policies and practices, including regulations relating to import-export control, tariffs, investment, exchange controls, anti-corruption and repatriation of earnings. Non-U.S. sales are also subject to varying currency, political and economic risks. Raw Materials, Parts and Subassemblies We are highly dependent on the availability of essential materials, parts and subassemblies from our suppliers and subcontractors. The most important raw materials required for our aerospace products are aluminum (sheet, plate, forgings and extrusions), titanium (sheet, plate, forgings and extrusions) and composites (including carbon and boron). Although alternative sources generally exist for these raw materials, qualification of the sources could take a year or more. Many major components and product equipment items are procured or subcontracted on a sole-source basis. Suppliers We are dependent upon the ability of a large number of U.S. and non-U.S. suppliers and subcontractors to meet performance specifications, quality standards and delivery schedules at our anticipated costs. While we maintain an extensive qualification and performance surveillance system to control risk associated with such reliance on third parties, failure of suppliers or subcontractors to meet commitments could adversely affect production schedules and program/contract profitability, thereby jeopardizing our ability to fulfill commitments to our customers. We are also dependent on the availability of energy sources, such as electricity, at affordable prices. 5 Seasonality No material portion of our business is considered to be seasonal. Executive Officers of the Registrant See “Item 10. Directors, Executive Officers and Corporate Governance” in Part III. Other Information Boeing was originally incorporated in the State of Washington in 1916 and reincorporated in Delaware in 1934. Our principal executive offices are located at 100 N. Riverside Plaza, Chicago, Illinois 60606, and our telephone number is (312) 544-2000. General information about us can be found at www.boeing.com. The information contained on or connected to our website is not incorporated by reference into this Annual Report on Form 10-K and should not be considered part of this or any other report filed with the Securities and Exchange Commission (SEC). Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as any amendments to those reports, are available free of charge through our website as soon as reasonably practicable after we file them with, or furnish them to, the SEC. The SEC maintains a website at www.sec.gov that contains reports, proxy statements and other information regarding SEC registrants, including Boeing. Forward-Looking Statements This report, as well as our annual report to shareholders, quarterly reports and other filings we make with the SEC, press and earnings releases and other written and oral communications, contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “should,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “anticipates” and similar expressions generally identify these forward-looking statements. Examples of forward-looking statements include statements relating to our future financial condition and operating results, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on expectations and assumptions that we believe to be reasonable when made, but that may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties and changes in circumstances that are difficult to predict. Many factors, including those set forth in the “Risk Factors” section below and other important factors disclosed in this report and from time to time in our other filings with the SEC, could cause actual results to differ materially and adversely from these forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and we assume no obligation to update or revise any forward-looking statement whether as a result of new information, future events or otherwise, except as required by law. 6 Item 1A. Risk Factors An investment in our common stock or debt securities involves risks and uncertainties and our actual results and future trends may differ materially from our past or projected future performance. We urge investors to consider carefully the risk factors described below in evaluating the information contained in this report. Risks Related to COVID-19 We face significant risks related to the spread of the COVID-19 virus and developments surrounding the global pandemic have had, and will continue to have, significant effects on our business, financial condition, results of operations and cash flows. We also face significant risks related to the global economic downturn and severe reduction in commercial air traffic caused by the pandemic. These risks include materially reduced demand for our products and services, increased instability in our operations and in our supply chain and challenges to the ongoing viability of some of our customers. In addition, f uture vaccination mandates or other government requirements may further disrupt our operations and those of our customers and suppliers. We may face similar risks in connection with any future public health crises, including resurgences in the spread of COVID-19. The COVID-19 pandemic has subjected our business, operations, financial performance, cash flows and financial condition to a number of risks, including, but not limited to those discussed below. Operations-related risks: As a result of the COVID-19 pandemic, we are facing increased operational challenges from the need to protect employee health and safety. These challenges have included, and may in the future include, production site shutdowns, workplace disruptions and restrictions on the movement of people, social distancing guidelines, increased employee absenteeism due to illness and/ or quarantine/contact tracing requirements, as well as reduced availability of raw materials and goods, both at our own facilities and those of our customers and suppliers. During the second quarter of 2020, we temporarily suspended operations in Puget Sound, South Carolina, and Philadelphia, as well as at several other key production sites. We had not previously experienced a complete suspension of our operations at these production sites. While we have resumed operations at all of our production sites, we cannot predict whether or where further production disruptions could be required or what the ongoing impact of COVID-19-related operating restrictions will be. For example, we continue to experience near-term production disruptions and inefficiencies as well as additional operating costs due to social distancing requirements, increased levels of employee absenteeism and other factors related to COVID-19 restrictions. We cannot predict the impact that future production disruptions may have on our business, operations, financial performance and financial condition. We continue to monitor federal, state and municipal health authorities for new or modified guidance and requirements concerning the COVID-19 pandemic, and we may be required to impose additional operational restrictions and/or suspend operations at key production sites based on these requirements and recommendations and/or workplace disruptions caused by COVID-19. If future vaccination mandates or other similar governmental requirements take effect, or if COVID-19 case rates worsen at one or more of our production facilities, we may face further increases in employee absenteeism and/or attrition, any of which could cause operational disruptions and otherwise have an adverse effect on our business and results of operations. Many of our suppliers also were required to suspend operations during the second quarter of 2020. In 2021, we experienced part shortages which disrupted our operations and delayed deliveries. We may experience additional disruptions and/or part shortages in 2022. Any such disruptions could have severe adverse impacts on our production costs, delivery schedule and/or ability to meet customer commitments. 7 Further production disruptions and inefficiencies, suspension of operations or delayed recovery in our operations, and/or any comparable impacts involving one or more of our key suppliers, or the failure of any of our key suppliers, would result in further challenges to our business, which could have a further material adverse effect on our business, financial position, results of operations and/or cash flows. Liquidity risks: The COVID-19 pandemic has also had a significant impact on our liquidity and overall debt levels. During the year ended December 31, 2021, net cash used by operating activities was $3.4 billion. At December 31, 2021, cash and short-term investments totaled $16.2 billion. Our debt balance totaled $58.1 billion at December 31, 2021, down from $63.6 billion at December 31, 2020. We expect negative operating cash flows in future quarters until deliveries begin to return to historical levels, and if the pace and scope of the recovery are worse than we currently contemplate, we may need to obtain additional financing in order to fund our operations and obligations. If we were to need to obtain additional financing, uncertainty related to COVID-19 and its impact on us and the aerospace industry, as well as continued uncertainty with respect to our credit rating could limit our access to credit markets and we may have difficulty obtaining financing on terms acceptable to us or at all. In addition, certain of our customers may also be unable to make timely payments to us. Factors that could limit our access to additional liquidity include further disruptions in the global capital markets and/or additional declines in our financial performance, outlook or credit ratings. The occurrence of any or all of these events could adversely affect our ability to fund our operations and/or meet outstanding debt obligations and contractual commitments. In addition, further downgrades in our credit ratings could adversely affect our cost of funds and related margins, liquidity, competitive position and access to capital markets, and a significant downgrade could have an adverse impact on our businesses. Customer-related risks: Commercial air traffic has fallen dramatically due to the COVID-19 pandemic. This trend has impacted passenger traffic most severely. Most airlines have significantly reduced their capacity, and many could implement further reductions. Many airlines are also implementing significant reductions in staffing. These capacity changes are causing, and are expected to continue to cause, negative impacts to our customers’ revenue, earnings, and cash flow, and in some cases may threaten the future viability of some of our customers, potentially causing defaults within our customer financing portfolio, which was $1.8 billion as of December 31, 2021 and/or requiring us to remarket aircraft that have already been produced and/or are currently in backlog. If we are unable to successfully remarket these aircraft and/or the narrow-body and wide-body markets do not recover as soon as we are currently assuming, or if we are required to further reduce production rates and/or contract the accounting quantity on any of our commercial programs, we could experience material reductions in earnings and/or be required to recognize a reach-forward loss on one or more of our programs. For example, in the fourth quarter of 2020, we recognized a reach-forward loss on the 777X program in part due to impacts related to the COVID-19 pandemic. Additionally, we may experience fewer new orders and increased cancellations across all of our commercial airplane programs as a result of the COVID-19 pandemic and associated impacts on demand. Our customers may also lack sufficient liquidity to purchase new aircraft due to impacts from the pandemic. In addition to the near-term impact, there is risk that the industry implements longer-term strategies involving reduced capacity, shifting route patterns and mitigation strategies related to impacts from COVID-19 and the risk of future public health crises. In addition, airlines may experience reduced demand due to reluctance by the flying public to travel as a result of travel restrictions and/or social distancing requirements. As a result, there is significant uncertainty with respect to whether and at what point commercial air traffic capacity will return to and/or exceed pre-COVID-19 levels. This uncertainty may have a significant impact on the demand for both single-aisle and wide-body commercial aircraft, as well as for the services we provide to commercial airlines. In addition, a lengthy period of reduced industry-wide demand for commercial aircraft would put additional pressure on our suppliers, resulting in increased procurement costs and/or additional supply chain disruption. To the extent that the COVID-19 pandemic 8 or its aftermath further impacts demand for our products and services or impairs the viability of some of our customers and/or suppliers, our financial position, results of operations and/or cash flows could be adversely affected, and those impacts could be material. Other risks: The magnitude and duration of the global COVID-19 pandemic is uncertain and continues to adversely affect our business and operating and financial results. For example, during the fourth quarter of 2020, due in part to the prolonged adverse impact of the pandemic on our earnings, we recorded an increase of $2.5 billion to the valuation allowance associated with deferred income tax assets. The pandemic also is expected to heighten many of the other risks described below. For example, the COVID-19 pandemic could cause and continue to cause an increasingly competitive labor market due to a sustained labor shortage or increased turnover rates within our employee base. Further, the COVID-19 pandemic may also affect our operating and financial results in a manner that is not presently known to us or that we currently do not expect to present significant risks to our operations or financial results. Risks Related to Our Business and Operations We remain subject to a number of risks and uncertainties related to the 737 MAX. These risks include uncertainties regarding the timing and conditions of remaining 737 MAX regulatory approvals, lower than planned production rates and/or delivery rates, additional considerations to customers, increased supplier costs and supply chain health, changes to the assumptions and estimates made in our financial statements regarding the 737 program and potential outcomes of 737 MAX-related legal proceedings and government investigations that remain outstanding. On March 13, 2019, the FAA issued an order to suspend operations of all 737 MAX aircraft in the U.S. and by U.S. aircraft operators following two fatal 737 MAX accidents. Non-U.S. civil aviation authorities issued directives to the same effect. Deliveries of the 737 MAX were suspended until December 2020. The grounding reduced revenues, operating margins and cash flows, and will continue to do so until production rates return to pre-grounding levels. While we have received regulatory approval to return the 737 MAX to service in most jurisdictions, we continue to work with certain non-U.S. civil aviation authorities to complete remaining steps toward certification and readiness for return to service worldwide. Any delays in the completion of the certification activities and/or the ramp-up of deliveries or other liabilities associated with the accidents or grounding could have a material adverse effect on our financial position, results of operations and/or cash flows. In addition, multiple legal actions have been filed against us related to the 737 MAX. We also are fully cooperating with U.S. government investigations related to the accidents and the 737 MAX, including an ongoing investigation by the Securities and Exchange Commission. We also remain subject to compliance with a Deferred Prosecution Agreement with the U.S. Department of Justice relating to the Department of Justice’s investigation into us regarding the evaluation of the 737 MAX airplane by the FAA. We expensed $744 million in the fourth quarter of 2020 related to this agreement. Any further adverse impacts related to any such litigation or investigations could have a further material impact on our financial position, results of operations and/or cash flows. During 2019, we announced plans to reduce, and ultimately to suspend 737 production. Impacts related to our suspension of 737 MAX production from 2019 to 2020 significantly increased costs to produce aircraft included in the current accounting quantity and have resulted in reduced 737 program and overall BCA segment operating margins. We have also made significant assumptions regarding estimated costs expected to be incurred in 2022 that should be included in program inventory and those estimated costs that will be expensed when incurred as abnormal production costs. If the completion of remaining certification activities and/or our ability to deliver 737 aircraft to customers is impaired, we will incur significant additional costs and/or be required to delay the planned ramp-up of 737 production. These delays would also result in significant additional disruption to the 737 production system and 9 further delay efforts to restore and/or implement previously planned increases in the 737 production rate. Cash flows continue to be negatively impacted by delayed payments from customers, higher costs and inventory levels, and payments made to customers in connection with disruption to their operations. In addition, we have experienced claims and assertions from customers in connection with the grounding and associated delivery delays, and recorded an estimate of potential concessions and other considerations to customers for these disruptions. As of December 31, 2021, the remaining liability associated with these concessions and other considerations totaled $2.9 billion, of which $0.7 billion remains subject to negotiation. Any further delays in regulatory approval of the 737 MAX in one or more jurisdictions, further disruptions to suppliers and/or the long-term health of the production system, supplier claims or assertions, or changes to estimated concessions or other considerations we expect to provide to customers could have a material adverse effect on our financial position, results of operations and/or cash flows. In the event of unanticipated additional training requirements in one or more jurisdictions, delays in regulatory approval and/or delays in our ability to resume deliveries to one or more customers, we may be required to take actions with longer-term impact, such as further changes to our production plans, employment reductions and/or the expenditure of significant resources to support our supply chain and/ or customers. We have made significant estimates with respect to the 737 program regarding the number of units to be produced, the period during which those units are likely to be produced, and the units’ expected sales prices, production costs, program tooling and other non-recurring costs, and routine warranty costs. We have made assumptions regarding outcomes of accident investigations and other government inquiries, timing of future 737 production rate increases, timing and sequence of future deliveries, supply chain health as we implement our production plans, as well as outcomes of negotiations with customers. Any changes in these estimates and/or assumptions with respect to the 737 program could have a material impact on our financial position, results of operations and/or cash flows. In addition to the impact of COVID-19 described above, our Commercial Airplanes and Global Services businesses depend heavily on commercial airlines, and are subject to unique risks. Market conditions have a significant impact on demand for our commercial aircraft and related services. The commercial aircraft market is predominantly driven by long-term trends in airline passenger and cargo traffic. The principal factors underlying long-term traffic growth are sustained economic growth and political stability both in developed and emerging markets. Demand for our commercial aircraft is further influenced by airline profitability, availability of aircraft financing, world trade policies, government-to-government relations, technological advances, price and other competitive factors, fuel prices, terrorism, epidemics and environmental regulations. Traditionally, the airline industry has been cyclical and very competitive and has experienced significant profit swings and constant challenges to be more cost competitive. Significant deterioration in the global economic environment, the airline industry generally or the financial stability of one or more of our major customers could result in fewer new orders for aircraft or services, or could cause customers to seek to postpone or cancel contractual orders and/or payments to us, which could result in lower revenues, profitability and cash flows and a reduction in our contractual backlog. In addition, because our commercial aircraft backlog consists of aircraft scheduled for delivery over a period of several years, any of these macroeconomic, industry or customer impacts could unexpectedly affect deliveries over a long period. We enter into firm fixed-price aircraft sales contracts with indexed price escalation clauses, which could subject us to losses fi we have cost overruns or fi increases in our costs exceed the applicable escalation rate. Commercial aircraft sales contracts are often entered into years before the aircraft are delivered. In order to help account for economic fluctuations between the contract date and delivery date, aircraft pricing generally consists of a fixed amount as modified by price escalation formulas 10 derived from labor, commodity and other price indices. Our revenue estimates are based on current expectations with respect to these escalation formulas, but the actual escalation amounts are outside of our control. Escalation factors can fluctuate significantly from period to period. Changes in escalation amounts can significantly impact revenues and operating margins in our Commercial Airplanes business. We derive a significant portion of our revenues from a limited number of commercial airlines. We can make no assurance that any customer will exercise purchase options, fulfill existing purchase commitments or purchase additional products or services from us. In addition, fleet decisions, airline consolidations or financial challenges involving any of our major commercial airline customers could significantly reduce our revenues and limit our opportunity to generate profits from those customers. Our Commercial Airplanes business depends on our ability to maintain a healthy production system, ensure every airplane in our production system conforms to our exacting specification, achieve planned production rate targets, successfully develop new aircraft or new derivative aircraft, and meet or exceed stringent performance and reliability standards. The commercial aircraft business is extremely complex, involving extensive coordination and integration with U.S and non-U.S. suppliers, highly-skilled labor from thousands of employees and other partners, and stringent regulatory requirements, including the risk of evolving standards for commercial aircraft certification, and performance and reliability standards. The FAA has been working to implement safety reforms such as the implementation of the 2018 FAA Reauthorization Act and the 2020 Aircraft Certification, Safety and Accountability Act, among them changing the process for certification of commercial aircraft. Comparable agencies that regulate similar matters in other countries may adopt similar changes. To the extent the FAA or other similar regulatory agencies outside the U.S. implement more stringent regulations, we may incur additional costs to achieve compliance. In addition, the introduction of new aircraft programs and/or derivatives, such as the 777X, involves increased risks associated with meeting development, testing, production and certification schedules. The 737 program experienced significant disruption due to the grounding of the 737 MAX and associated suspension of commercial operations of the 737 MAX aircraft by civil aviation authorities around the globe. 737 MAX deliveries resumed in late 2020 and early 2021 upon approval of the FAA and other non-U.S. civil aviation authorities. During 2020 and 2021, we experienced production quality issues, including in our supply chain, which have contributed to lower 787 deliveries, including a pause in 787 deliveries since May 2021. During 2021, this resulted in reprioritizing production resources to support inspections and rework. We continue to conduct inspections and rework on undelivered 787 aircraft and engage in detailed discussions with the FAA regarding required actions for resuming delivery. A number of our customers may have contractual remedies, including compensation for late deliveries as well as rights to reject individual airplane deliveries if the actual delivery date is significantly later than the contractual delivery date. The regulators will ultimately determine the timing and conditions for resuming 787 deliveries. Delays on the 737 MAX, 777X and 787 programs have resulted in, and may continue to result in, customers having the right to terminate orders and/or substitute orders for other Boeing aircraft. We must minimize disruption caused by production changes, achieve operational stability and implement productivity improvements in order to meet customer demand and maintain our profitability. We have previously announced plans to adjust production rates on several of our commercial aircraft programs. During 2021, we reprioritized production resources to support inspections and rework on undelivered 787 aircraft. The 787 program is currently producing at very low rates and expects that to continue until deliveries resume. We are also continuing to implement changes in the production process designed to ensure that newly-built airplanes meet our specifications and do not require further inspections and rework. In addition, we continue to seek opportunities to reduce the costs of building our aircraft, including working with our suppliers to reduce supplier costs, identifying and implementing productivity improvements and optimizing how we manage inventory. If production rate changes at any 11 of our commercial aircraft assembly facilities are delayed or create significant disruption to our production system, or if our suppliers cannot timely deliver components to us at the cost and rates necessary to achieve our targets, we may be unable to meet delivery schedules and/or the financial performance of one or more of our programs may suffer. Operational challenges impacting the production system for one or more of our commercial aircraft programs could result in production delays and/or failure to meet customer demand for new aircraft, either of which would negatively impact our revenues and operating margins. Our commercial aircraft production system is extremely complex. Operational issues, including delays or defects in supplier components, failure to meet internal performance plans, or delays or failures to achieve required regulatory approval, could result in significant out-of-sequence work and increased production costs, as well as delayed deliveries to customers, impacts to aircraft performance and/or increased warranty or fleet support costs. For example, in 2021, we performed additional inspections and associated rework on 787 aircraft in inventory and continued discussions with the FAA regarding required actions to resume deliveries, resulting in additional costs and further delays in aircraft deliveries to customers. If our commercial airplanes fail to satisfy performance and reliability requirements, we could face additional costs and/or lower revenues. Developing and manufacturing commercial aircraft that meet or exceed our performance and reliability standards, as well as those of customers and regulatory agencies, can be costly and technologically challenging. These challenges are particularly significant with newer aircraft programs. Any failure of any Boeing aircraft to satisfy performance or reliability requirements could result in disruption to our operations, higher costs and/or lower revenues. Changes in levels of U.S. government defense spending or overall acquisition priorities could negatively impact our financial position and results of operations. We derive a substantial portion of our revenue from the U.S. government, primarily from defense related programs with the U.S. DoD. Levels of U.S. defense spending are very difficult to predict and may be impacted by numerous factors such as the evolving nature of the national security threat environment, U.S. national security strategy, U.S. foreign policy, the domestic political environment, macroeconomic conditions and the ability of the U.S. government to enact relevant legislation such as authorization and appropriations bills. The timeliness of FY22 and future appropriations for government departments and agencies remains a recurrent risk. A lapse in appropriations for government departments or agencies would result in a full or partial government shutdown, which could impact the Company’s operations. Alternatively, Congress may fund government departments and agencies with one or more Continuing Resolutions; however, this would restrict the execution of certain program activities and delay new programs or competitions. In addition, long-term uncertainty remains with respect to overall levels of defense spending in FY22 and beyond, and it is likely that U.S. government discretionary spending, including defense spending, will continue to be subject to pressure. There continues to be uncertainty with respect to future acquisition priorities and program-level appropriations for the U.S. DoD and other government agencies (including NASA), including changes to national security and defense priorities, and tension between modernization investments, sustainment investments, and investments in new technologies or emergent capabilities. Future investment priority changes or budget cuts, including changes associated with the authorizations and appropriations process, could result in reductions, cancellations, and/or delays of existing contracts or programs, or future program opportunities. Any of these impacts could have a material effect on the results of the Company’s financial position, results of operations and/or cash flows. In addition, as a result of the significant ongoing uncertainty with respect to both U.S. defense spending and the evolving nature of the national security threat environment, we also expect the U.S. DoD to continue to emphasize affordability, innovation, cybersecurity and delivery of technical data and 12 software in its procurement processes. If we can no longer adjust successfully to these changing acquisition policies, our revenues and market share could be impacted. Also, additional federal appropriations to cover the increased costs of federal contractors’ compliance with evolving U.S. Government contractual requirements associated with COVID-19 mitigation are unlikely, reducing the U.S. Government’s buying power. Our ability to deliver products and services that satisfy customer requirements is heavily dependent on the performance and financial stability of our subcontractors and suppliers, as well as on the availability of raw materials and other components. We rely on other companies, including U.S. and non-U.S. subcontractors and suppliers, to provide and produce raw materials, integrated components and sub-assemblies, and production commodities and to perform some of the services that we provide to our customers. If one or more of our suppliers or subcontractors experiences financial difficulties, delivery delays or other performance problems, we may be unable to meet commitments to our customers or incur additional costs. In addition, if one or more of the raw materials on which we depend (such as aluminum, titanium or composites) becomes unavailable to us or our suppliers, or is available only at very high prices, we may be unable to deliver one or more of our products in a timely fashion or at budgeted costs. In some instances, we depend upon a single source of supply. Any service disruption from one of these suppliers, either due to circumstances beyond the supplier’s control, such as geopolitical developments, or as a result of performance problems or financial difficulties, could have a material adverse effect on our ability to meet commitments to our customers or increase our operating costs. Competition within our markets and with respect to the products we sell may reduce our future contracts and sales. The markets in which we operate are highly competitive and one or more of our competitors may have more extensive or more specialized engineering, manufacturing and marketing capabilities than we do in some areas. In our Commercial Airplanes business, we anticipate increasing competition among nonU.S. aircraft manufacturers of commercial jet aircraft. In our BDS business, we anticipate that the effects of defense industry consolidation, shifting acquisition and budget priorities, and continued cost pressure at our U.S. DoD and non-U.S. customers will intensify competition for many of our BDS products. Our BGS segment faces competition from many of the same strong U.S. and non-U.S. competitors facing BCA and BDS. Furthermore, we are facing increased international competition and cross-border consolidation of competition. There can be no assurance that we will be able to compete successfully against our current or future competitors or that the competitive pressures we face will not result in reduced revenues and market share. We derive a significant portion of our revenues from non-U.S. sales and are subject to the risks of doing business in other countries. In 2021, non-U.S. customers, which includes foreign military sales (FMS), accounted for approximately 37% of our revenues. We expect that non-U.S. sales will continue to account for a significant portion of our revenues for the foreseeable future. As a result, we are subject to risks of doing business internationally, including: • changes in regulatory requirements or other executive branch actions, such as Executive Orders; • changes in the global trade environment, including disputes with authorities in non-U.S. jurisdictions, including international trade authorities, that could impact sales and/or delivery of products and services outside the U.S. and/or impose costs on our customers in the form of tariffs, duties or penalties attributable to the importation of Boeing products and services; 13 • U.S. and non-U.S. government policies, including requirements to expend a portion of program funds locally and governmental industrial cooperation or participation requirements; • fluctuations in international currency exchange rates; • volatility in international political and economic environments and changes in non-U.S. national priorities and budgets, which can lead to delays or fluctuations in orders; • the complexity and necessity of using non-U.S. representatives and consultants; • the uncertainty of the ability of non-U.S. customers to finance purchases, including the availability of financing from the Export-Import Bank of the United States; • uncertainties and restrictions concerning the availability of funding credit or guarantees; • imposition of domestic and international taxes, export controls, tariffs, embargoes, sanctions and other trade restrictions; • the difficulty of management and operation of an enterprise spread over many countries; • compliance with a variety of non-U.S. laws, as well as U.S. laws affecting the activities of U.S. companies abroad; and • unforeseen developments and conditions, including terrorism, war, epidemics and international tensions and conflicts. While the impact of these factors is difficult to predict, any one or more of these factors could adversely affect our operations in the future. For example, since 2018, the U.S. and China have imposed tariffs on each other’s imports. China is a very significant market for commercial airplanes and represents a significant component of our commercial airplanes backlog. Impacts from these or future potential tariffs, or deterioration in trade relations between the U.S. and one or more other countries, could have a material adverse impact on our financial position, results of operations and/or cash flows. We use estimates in accounting for many contracts and programs. Changes in our estimates could adversely affect our future financial results. Contract and program accounting require judgment relative to assessing risks, estimating revenues and costs and making assumptions for schedule and technical issues. Due to the size and nature of many of our contracts and programs, the estimation of total revenues and cost at completion is complicated and subject to many variables. Assumptions hav…

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