Aviation Updates Mr. John Schubert Managing Director, Marketing-Asia Pacific & India
Market Update 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. John Schubert Managing Director, Marketing Boeing Commercial Airplanes May 2017
Agenda Market trends and performance Current Market Outlook (CMO) Product update
900 800 700 600 601 648 723 762 748 500 477 400 300 200 100 0 2011 2012 2013 2014 2015 2016
Growth driven by emerging economies, LCCs Continued strong replacement demand New airplanes, capabilities opening new markets
LCC ASM share 25% 20% 15% February 2006 10% 5% 0% 2006 2008 2010 2012 2014 2016 February 2016 SOURCE: Innovata
787 opening new markets More than 140 new nonstop markets now connected with the 787 In operation Announced As of March 23, 2017
Traffic growth rates (RPKs) Net profit (billions) Net profit margins 8% $40 6% 7% $35 5% 6% $30 5% $25 4% 4% $20 3% 3% $15 2% 2% $10 1% $5 1% 0% 2011 2012 2013 2014 2015 2016 $0 2011 2012 2013 2014 2015 2016 0% 2011 2012 2013 2014 2015 2016 SOURCE: IATA 8
Passenger traffic growth Cargo traffic growth Airline profits SOURCES: Boeing estimates for growth, IATA forecast for airline profits
Headwinds in the market Economic Geopolitical $ $ $ $ Wide economic growth variation Populism Volatile exchange rates Increased geopolitical uncertainty BREXIT Trade / air cargo Terrorism frequency, breadth
Agenda Market performance, trends Current Market Outlook (CMO) Product update
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 RPKs (trillions) Resilient, growing market expected to continue 5% long-term growth rate 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 RPKs = Revenue Passenger Kilometers SOURCE: ICAO scheduled traffic
Average annual growth 4.0% 4.8% 4.2% 2.9% World economy (GDP) Number of airline passengers Passenger traffic (RPK) Cargo traffic (RTK) GDP Pax RPK RTK
World Market fragmentation drives growth 2.5 2.0 Air Travel Growth Frequency Growth Nonstop Markets 1.5 1.0 Average Airplane Size 0.5 SOURCE: August OAG/Innovata Index 1995=1.00
Airplane deliveries: 39,620 2016-2035 Market value: $5,930B 2016-2035 30,000 28,140 Airplane Type Value 2% 25,000 20,000 15,000 10,000 5,000 0 2,380 Regional jets 6% Singleaisle 71% 5,100 Small wide-body 13% 3,470 Medium wide-body 9% 530 Large wide-body 1% Regional jets $110B Single-aisle Small wide-body $3,000B $1,350B Medium wide-body $1,250B Large wide-body $220B World Total $5,930B 21% 23% 4% $5.9T 51% NOTE: market share may not equal 100% due to rounding
RPKs (billions) Within South Asia 2015 traffic Added traffic 2016-2035 Annual growth % 9.5% Middle East 7.5% Southeast Asia 8.9% Europe China 7.5% 5.8% South Asia GDP Growth: 6.3% North America Africa 7.8% 10.0% South Asia Average Growth: 8.6% Northeast Asia 6.6% 0 100 200 300 400 500
Airplane deliveries: 2,000 2016-2035 1,800 1,500 1,200 900 600 300 0 20 Regional jets 1% 1,690 Singleaisle 85% 140 Small wide-body 7% 150 Medium wide-body 8% 0 Large wide-body 0% Market value: $260 billion 2016-2035 180 150 120 90 60 30 0 $<5B Regional jets <1% $180B Singleaisle 69% $30B Small wide-body 12% $50B Medium wide-body 19% $0B Large wide-body 0% NOTE: market share may not equal 100% due to rounding
Commercial Aviation Services: $8T 2016-2035 Services by region 2016-2035 5,000 4,000 3,000 2,000 1,000 0 CAGR $125 Corporate & External 2.9% $450 Marketing & Planning 4.2% $1,140 Flight Ops 3.9% $2,110 Maintenance & Engineering 4.1% $4,300 Ground, & Cargo Ops 3.7% Region Services / CAGR Asia 3,025 5.0% North America 1,685 2.3% Europe 1,700 2.6% Middle East 740 5.3% Latin America 525 4.7% Africa 210 5.3% C.I.S. 240 3.9% World Total $8,125 3.9% 9% 21% 3% 6% 3% $8T 21% 37%
Agenda Market performance, trends Current Market Outlook (CMO) Product update
Seats Seats Superior value, efficient market coverage Current Boeing Future Boeing 500 500 747-8 747-8 450 450 777-9 400 777-300ER 400 777-8 350 350 787-10 777-200LR 300 787-9 787-9 300 250 787-8 787-8 250 200 767-300ER 737 MAX 200 200 737-900ER 737 MAX 9 150 737-800 737-700 737 MAX 8 737 MAX 7 150 100 100 Boeing Standard Rules seat counts
Backlog by value ($B) 747 ME, Central & S. Asia Leasing, Gov't & BBJ Region North America L. America & Africa Asia Pacific Backlog = 5,715 aircraft Value = $416 billion 777 Large 1% Twin- Aisle 49% Model Single- Aisle 50% 737 Europe & Russia China, East & SE Asia 787 767
First delivery in 2018
737 MAX 7 and 737 MAX 200
Most profitable single-aisle the industry has ever seen
First delivery in 2018
Industry- Award- Greater Earlier Highly leading winning range airplane valued reliability interior capability availability investment