COMMERCIAL

MARKET
OUTLOOK
2019 – 2038

Randy Tinseth
Vice President, Commercial Marketing
17 June 2019

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The statements contained herein are based on good faith assumptions are to be used for general information purposes only. These statements do not constitute an offer, promise, warranty or guarantee of performance.
CSM-RJT2019CMOROLL-17JUN19
 BOEING’S MARKET OUTLOOK I 10-YEAR SERVED

Total Served Market

$8.7T
2.9% CAGR

Commercial Defense, Space Global

Airplanes & Security Services
$3.1T $2.5T $ 3.1T
3.5% CAGR
3.6% CAGR 1.2% CAGR
20,600 units

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 Long-term forecast of global air travel, new airplane demand
and commercial services

All jets >30 seats

and freighters in
commercial service

$6.8T $9.1T
Services required to
support the operation of
commercial aviation

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 Nine years of profitable growth
for our customers
Global GDP growth Traffic growth rates (RPKs) Net profit ($billions)

8.5% 8.4%
4.4% 40.1
7.6% 7.5% 7.7% 37.5
7.4%
35.6

6.1% 6.2% 30.0

3.2% Trend 3.3% 3.2%
3.1% 5.7%
3.0%
Trend
2.8% 2.7% 2.7%

18.1 17.3
17.3

$8.3 $9.2

SOURCES: IHS Markit, ICAO, IATA and Cirium Fleets Analyzer

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 Most diverse market in history

Economies Developing Emerging Mature

Networks Short-haul Mid-haul Long-haul

Business models Low Cost Hybrid Network

Fleet needs Expansion Growth Replacement

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 Single-aisles driving global
network expansion
20,000

18,000

16,000
~7,000
nonstop markets
14,000
added past 10 years
Single-aisle city-pairs

12,000

10,000

8,000

6,000
60%
Network increase
4,000
since 2008
2,000

0
2008 2018

SOURCES: FlightGlobal August schedules, Boeing analysis

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 >30% of long-haul network is
new in last decade

Africa

#
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America
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widebody routes
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since 2008
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 Global airplane market trends

Resilient Sustainable Productive

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 Resilient growth market continues
800

700
RPKs and GDP (index, 1980=100)

600

500 World RPKs = x7

400

300
World GDP = x3
200

100

0
1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018
RPKs = Revenue Passenger Kilometers
SOURCE: ICAO scheduled traffic / 2018E/202019F IATA December 2018, GDP (constant $ and exchange rate) from Oxford Economics

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 Structural factors driving
sustainable growth
Global middle class Emerging and developing market Accessibility and affordability
expanding urban population rising improving
3,000 65.0% 200

180
60.0%
2,500
160
+1.5
billion
Million households

55.0% 140
people Airport pairs

Index, 2000=100
2,000

>$20K annual income

120
50.0%

1,500 100 Average yield

45.0%
80

1,000
40.0% 60

40
500
<$20K

35.0%
20

0 30.0% 0
2003

2018

2023

2028

2033

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018
2008

2013

1998

2018

2038
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 Productivity driving
sustainable growth
1.9 1.9
RPK

1.8 1.8 Tr a f f i c i n c r e a s i n g
1.7

1.6
1.7

1.6
>x2 ~7,100
Airplanes

the global fleet

1.5 1.5

1.4 1.4

1.3 1.3
~6,700
1.2 1.2 Airplanes

1.1 1.1
Fleet
1.0 1.0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

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 Why the Commercial Market Outlook
(CMO)?

Guide
Long-range
business planning

Shape Inform
Our product Suppliers and
strategy airline customers

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 20-year forecast:
continued long-term growth

World Passenger
Economy
(GDP)
2.7% Traffic
(RPK)
4.6%
Commercial Cargo
4.2% Services
($)
4.2% Traffic
(RTK)

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 Airlines will need 44,000 new airplanes
valued at $6.8 trillion

Airplane deliveries: 44,040 New airplane values: $6.8T

2019 - 2038 2019 - 2038
35,000 32,420 4,000 $3,775B
30,000
25,000 3,000 $2,630B
20,000
15,000 2,000
10,000 8,340
1,000
5,000 2,240 1,040 $300B
$105B
0 0
Regional jet Single-aisle Widebody Freighter Regional jet Single-aisle Widebody Freighter
5% 74% 19% 2% 2% 55% 39% 4%

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 Fleet will double,
composition to shift
50,660 50,660
50,000 50,000
Frtr 7%

WB 19%

40,000 24,830 40,000

Growth
56%

30,000 44,040 30,000

25,830
25,830 Frtr 8%

WB 17% SA 69%
20,000 19,210 20,000
Replacement
44%
SA 64%
10,000 10,000

6,620
Retained fleet RJs 10% RJs 5%
0 0
2018 2038 2018 2038
SOURCES: Fleet Analyzer & Boeing CMO

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 Dynamic global market

1980-2000
60-70% of aviation
& economic market 2019-2038
50+% of future economic growth
4X population & middle class

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 Asia Pacific responsible for 40%
of future airplane demand

New airplane deliveries by region Market values by region

2019 - 2038 2019 - 2038
Region Airplanes 3% Region Values 3%
Asia Pacific 17,390 Asia Pacific $2,830B 6%
7% 3% 2%
North America 9,130 7% North America $1,155B
11%
Europe 8,990 Europe $1,370B
39% 41%
Middle East 3,130 44,040 Middle East $725B $6.8T
Latin America 2,960 20% Latin America $395B 20%
Russia & Central Asia 1,280 Russia & Central Asia $160B
Africa 1,160 21% Africa $175B 17%
World Total 44,040 World Total $6,810B

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 Freighter fleet is growing

2,000

1,600
685
5.4%
annual growth
657
593 617
Freighter fleet units

526 570
1,200

800
482 497 531
570
3.8%
annual growth
472 478

400
498 496 514 516 525 560
2.4%
annual growth
0
2013 2014 2015 2016 2017 2018

Large Medium widebody Standard body

Western only

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 Freighter demand – 1,040 new,
1,780 converted

540

1,220
Deliveries
2,820
560

500

3,500 3,400

3,000 Large
production
2,500 Widebody
conversions
2,000 1,970
Medium WB
1,500 production

1,000
Standard-
body
500 conversions

0 Fleet
2038
2018 Freighters
Freighters

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 Global services market trends

Technology Efficiency Value

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 Commercial aviation will demand
$9.1 trillion in services over 20 years

Commercial Aviation Services: $9.1T Services by Region

2019 - 2038 2019 - 2038
$4,825B Region Services | CAGR
5,000 2%
2%
Asia Pacific 3,480 | 5.1%
6% 3%
4,000 Europe 1,980 | 3.3% 6% 3%
9%
8%
3,000 North America 1,865 | 2.8%
$2,400B 38%
38%
2,000 Middle East 790 | 4.7%
$1,175B
$9.1T
Latin America 500 | 4.7%
1,000 $545B 20%
21%
$155B Russia/CA 270 | 2.7%
0
Corporate Marketing Flight Maintenance Ground & Africa 215 | 5.0%
& External & Planning Opns & Engineering Cargo Opns 21%
22%
CAGR 3.2% 5.2% 3.7% 4.0% 4.1% World Total $ 9,100B | 4.1%

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 Emerging customer needs drive
our products and services
FREIGHTER

PASSENGER

SERVICES

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 Delivering value to our customers

Services growing
5,500+ backlog faster than market

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2018 Boeing. All rights reserved. CSM-RJT2019CMOROLL-17JUN19
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 2.2 million commercial aviation personnel
needed to fly, maintain world fleet

645,000 632,000 881,000

415,000 75,000
415,000 EUROPE
RUSSIA & C. ASIA

NORTH AMERICA
231,000 816,000
MIDDLE EAST

75,000 ASIA-PACIFIC
131,000 AFRICA
LATIN AMERICA

Boeing Pilot & Technician Outlook 2019-2038

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Copyright © 2019 Boeing. All rights reserved.