What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2024-01-31 compared with 2023-01-27 · 102 added, 109 removed, 224 unchanged (49% of the section changed)

15 unchanged sentences

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.

Changes in escalation amounts can significantly impact revenues and operating margins in our BCA business.

We derive a significant portion of our revenues from a limited number of commercial airlines.

1 unchanged sentence

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.

Airlines also are experiencing increased fuel and other costs, and the global economy is experiencing high inflation.

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 specifications, achieve planned production rate targets, successfully develop and certify 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.

Airlines also are experiencing increased fuel and other costs, and the global economy has experienced high inflation.

Our Commercial Airplanes business depends on our ability to maintain a healthy production system, ensure every airplane in our production system conforms to exacting specifications,

achieve planned production rate targets, successfully develop and certify 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.

suppliers, highly-skilled labor performed by thousands of employees of ours and other partners, and stringent and evolving regulatory requirements and performance and reliability standards.

The FAA has been working to implement safety reforms such as the 2018 FAA Reauthorization Act and the 2020 Aircraft Certification, Safety and Accountability Act (ACSAA).

One of these, section 116 of the ACSAA prohibited the FAA from issuing a type certificate to aircraft after December 27, 2022 unless the aircraft’s flight crew alerting system met certain specifications.

The Consolidated Appropriations Act, 2023 amended Section 116 of the ACSAA, such that applications for original or amended type certifications that were submitted to the FAA prior to December 27, 2020, including those of the 737-7 and 737-10, are no longer subject to the crew alerting specifications of Section 116.

Additionally, beginning one year after the FAA issues the type certificate for the 737-10, any new 737 MAX aircraft must include certain safety enhancements to be issued an original airworthiness certification by the FAA.

These enhancements are included in Boeing’s application for the certification for the 737-10, and the sufficiency of these enhancements will be determined by the FAA.

Beginning three years after the issuance of a type certificate for the 737-10, all previously delivered 737 MAX aircraft must be retrofitted with these safety enhancements.

As the holder of the type certificate, Boeing is required to bear any costs of these safety enhancement retrofits.

We have provisioned for the estimated costs associated with the safety enhancements and do not expect those costs to be material.

If we experience delays in achieving certification and/or incorporating safety enhancements, future revenues, cash flows and results of operations could be adversely impacted.

Comparable agencies in other countries may adopt similar changes.

To the extent the FAA or similar regulatory agencies outside the U.S.

implement more stringent regulations, we may incur additional compliance costs.

In addition, the introduction of new aircraft programs and/or derivatives, such as the 777X, 737-7 and 737-10, involves increased risks associated with meeting development, testing, certification and production schedules.

In addition, we have experienced production quality issues, including in our supply chain, which have contributed to lower 787 deliveries, including a suspension of 787 deliveries from May 2021 to August 2022.

We continue to conduct inspections and rework on built and stored 787 aircraft.

We have experienced and may continue to experience production quality issues, including in our supply chain.

On January 10, 2024, the FAA notified us that it has initiated an investigation into our quality control system.

This was followed by the FAA announcing actions to increase its oversight of us, including conducting (1) an audit involving the 737-9 production line and suppliers to evaluate compliance with approved quality procedures, (2) increased monitoring of 737-9 in-service events, and (3) an assessment of safety risks around delegated authority and quality oversight, and examination of options to move these functions under independent third parties.

On January 24, 2024, the FAA stated that it will not approve production rate increases or additional production lines for the 737 MAX until it is satisfied that we are in full compliance with required quality control procedures.

We are currently unable to reasonably estimate what impact the January 5, 2024 Alaska Airlines accident and the related FAA actions will have on our financial position, results of operations and cash flows.

The introduction of new aircraft programs and/or derivatives, such as the 777X, 737-7 and 737-10, involves risks associated with meeting development, testing, certification and production schedules.

We are following the lead of the FAA as we work through the certification process, and the FAA will ultimately determine the timing of certification and entry into service.

In addition, the development schedules of the 737-7 and 737-10 could be impacted by actions resulting from the Alaska Airlines accident.

If we experience delays in achieving certification and/or incorporating safety enhancements, our financial position, results of operations and cash flows would be adversely impacted.

A number of our customers have contractual remedies, including compensation for late deliveries or rights to reject individual airplane deliveries based on delivery delays.

2 unchanged sentences

We have previously announced plans to adjust production rates on several of our commercial aircraft programs.

The 787 program is currently producing at low rates and we expect to gradually increase to 5 per month in 2023.

Production of the 777X is currently paused and is expected to resume in 2023.

The 737 program has experienced operational and supply chain challenges stabilizing production at 31 per month.

We plan to gradually increase 737 production rates based on market demand and supply chain capacity.

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 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.

If production rate changes at any of our commercial aircraft assembly facilities are delayed or create significant disruption to our production system, or if our suppliers cannot timely deliver components that comply with design specifications 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 additional production delays and/or failure to meet customer demand for new aircraft, either of which would negatively impact our revenues and operating margins.

1 unchanged sentence

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 additional 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.

We and our suppliers are experiencing supply chain disruptions as a result of the lingering impacts of COVID-19, global supply chain constraints, and labor instability.

We and our suppliers are also experiencing inflationary pressures.

We continue to monitor the health and stability of the supply chain as we ramp up production.

These factors have reduced overall productivity and adversely impacted our financial position, results of operations and cash flows.

We and our suppliers are experiencing supply chain disruptions and constraints, labor instability and inflationary pressures.

We continue to monitor the health and stability of

the supply chain.

These factors have and may continue to reduce overall productivity and adversely impact our financial position, results of operations and cash flows.

If our commercial aircraft fail to satisfy performance and reliability requirements and/or potentially required sustainability standards, we could face additional costs and/or lower revenues.

3 unchanged sentences

Changes in levels of U.S.

government defense spending or acquisition priorities could negatively impact our financial position and results of operations.

government defense spending or acquisition priorities, as well as significant delays in U.S.

government appropriations, could negatively impact our business, financial position and results of operations.

We derive a substantial portion of our revenue from the U.S.

5 unchanged sentences

government to enact relevant legislation such as authorization and appropriations bills.

The timeliness of FY24 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 FY24 and beyond.

government discretionary spending, including defense spending, is likely to 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.

The government may also constrain discretionary spending by instituting enforceable spending caps.

The timeliness of annual appropriations for U.S.

government departments and agencies remains a recurrent risk.

Congress may fund government departments and agencies with one or more continuing resolutions, which could delay new programs or competitions and/or negatively impact the execution of certain program activities.

A lapse in appropriations for government departments or agencies would result in a full or partial government shutdown, which could impact our operations.

In the event of a prolonged shutdown, requirements to furlough employees in the U.S.

DoD, the Department of Transportation, including the FAA, or other government agencies could result in payment delays, impair our ability to deliver commercial airplanes or perform work on existing contracts, delays in the certification of new aircraft or otherwise impact our operations, negatively impact future orders, and/or cause other disruptions or delays.

There is uncertainty regarding which government functions would shut down or continue operations during a lapse in appropriations, and corresponding uncertainty regarding the extent or magnitude of potential impacts to our operations.

For additional information on U.S.

government appropriations and budgets, see “Management’s Discussion & Analysis - Additional Considerations - U.S.

Government Funding” on page 28 of this Form 10-K.

In addition, 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.

Any of these impacts could have a material effect on our financial position, results of operations and/or cash flows.

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 software in its procurement processes, including the implementation of cybersecurity compliance requirements on the Defense Industrial Base, for which the supply chain may not be fully prepared.

We and our suppliers will need to continue to adjust successfully to these changing acquisition priorities and policies or our revenues and market share could be impacted.

If we and our suppliers

are unable to adjust to these changing acquisition priorities and policies, our revenues and market share could be impacted.

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 highly skilled labor, raw materials and other components.

1 unchanged sentence

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.

Many of our suppliers are experiencing inflationary pressures, as well as disruptions due to the lingering impacts of COVID-19, global supply chain constraints, and labor instability.

Many of our suppliers are experiencing inflationary pressures, as well as resource constraints and disruptions due to production quality issues, global supply chain constraints, and labor instability.

If one or more of our suppliers or subcontractors continue to experience financial difficulties, delivery delays or other performance problems, we may be unable to meet commitments to our customers and our financial position, results of operations and cash flows may continue to be adversely impacted.

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.

For example, we suspended purchasing titanium from Russia during 2022 as a result of the Russia Ukraine war.

We believe we have sufficient material and parts to avoid production disruptions in the near-term, but future impacts to our production from disruptions in our supply chain are possible.

We continue proactively working to ensure sufficient material and parts to avoid potential near-term production disruptions, while also working to mitigate the risk of future impacts from disruptions to our supply chain.

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.

Some of our and our suppliers’ workforces are represented by labor unions, which may lead to work stoppages.

Approximately 57,000 employees, which constitute 33% of our total workforce, were union represented as of December 31, 2023 under collective bargaining agreements with varying durations and expiration dates.

For additional information on our principal collective bargaining agreements, see “Business – Human Capital” on page 2 of this Form 10-K.

We experienced a work stoppage in 2008 when a labor strike halted commercial aircraft and certain BDS program production.

We may experience additional work stoppages in the future, which could adversely affect our business.

We cannot predict how stable our union relationships, currently with 10 U.S.

labor organizations and 4 non-U.S.

labor organizations, will be or whether we will be able to meet the unions’ requirements without impacting our financial condition.

The unions may also limit our flexibility in managing our workforce and operations.

Union actions at suppliers can also affect us.

Work stoppages and instability in our union relationships could delay the production and/or development of our products, which could strain relationships with customers and result in lower revenues.

Competition within our markets and with respect to our products and services 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.

6 unchanged sentences

Furthermore, we are facing increased international competition and cross-border consolidation of competition, and U.S.

procurement and compliance requirements that could limit our ability to be cost-competitive in the international market.

procurement and compliance requirements that could limit our ability to be cost-competitive in the

international market.

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.

2 unchanged sentences

In 2023, non-U.S.

customers, which includes foreign military sales (FMS), accounted for approximately 41% of our revenues.

customers, which include foreign military sales (FMS), accounted for approximately 42% 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:

We are subject to risks of doing business internationally, including:

• changes in regulatory requirements or other executive branch actions, such as Executive Orders;

25 unchanged sentences

Overall, the U.S.-China trade relationship remains stalled as economic and national security concerns continue to be a challenge.

China is a significant market for commercial aircraft.

Boeing has long-standing relationships with our Chinese customers, who represent a key component of our commercial aircraft backlog.

For the 737 MAX, there is uncertainty regarding timing of resumption of deliveries in China which is still subject to final regulatory approvals.

If we are unable to obtain additional orders from China in the future, our market share could be adversely affected.

Furthermore, following Russia’s invasion of Ukraine, we suspended our operations in Russia due to sanctions and export controls, and the war has negatively impacted, and could continue to adversely impact, our business and financial results.

Impacts from future potential deterioration in trade relations between the U.S.

China is a significant market for commercial aircraft and we have long-standing relationships with our Chinese customers, who represent a key component of our commercial aircraft backlog.

If we are unable to deliver aircraft to customers in China consistent with our assumptions and/or obtain additional orders from China in the future, we may experience reduced deliveries and/or lower market share.

Impacts from future potential deterioration in geopolitical or 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.

12 unchanged sentences

Changes to customer or model mix, production costs and rates, learning curve, changes to price escalation indices, costs of derivative aircraft, supplier performance, customer and supplier negotiations/settlements, supplier claims and/or certification issues can impact these estimates.

In addition, on development programs such as the 777X, 737-7 and 737-10 we are subject to risks with respect to the timing and conditions of aircraft certification, including potential gaps between when aircraft are certified in various jurisdictions, changes in certification processes and our estimates with respect to timing of future certifications, which could have an impact on overall program status.

In addition, on development programs such as the 777X, 737-7 and 737-10 we are subject to risks with respect to the timing and conditions of aircraft certification, including potential gaps between when aircraft are certified in various jurisdictions, changes in certification processes and our estimates with respect to the timing of future certifications, which could have an impact on overall program status.

Any such change in estimates relating to program accounting may adversely affect future financial performance.

1 unchanged sentence

Changes in underlying assumptions, circumstances or estimates may adversely affect future period financial performance.

For additional information on our accounting policies for recognizing sales and profits, see our discussion under “Management’s Discussion and Analysis – Critical Accounting Policies & Estimates – Accounting for Long-term Contracts/Program Accounting” on pages 48 - 49 and Note 1 to our Consolidated Financial Statements on pages 59 - 69 of this Form 10-K.

For additional information on our accounting policies for recognizing sales and profits, see our discussion under “Management’s Discussion and Analysis – Critical Accounting Estimates – Accounting for Long-term Contracts/Program Accounting” on pages 46 - 47 and Note 1 to our Consolidated Financial Statements on pages 57 - 67 of this Form 10-K.

We may not realize the anticipated benefits of mergers, acquisitions, joint ventures/strategic alliances or divestitures.

12 unchanged sentences

In 2023, 37% of our revenues were earned pursuant to U.S.

government contracts, which include FMS through the U.S.

government contracts, which include Foreign Military Sales (FMS) through the U.S.

Business conducted pursuant to such contracts is subject to extensive procurement regulations and other unique risks.

10 unchanged sentences

government contracts may be reduced or withheld as part of the U.S.

Congressional appropriations process due to fiscal constraints, changes in U.S.

national security strategy and/or priorities or other reasons.

Congressional appropriations process due to changes in U.S.

national security strategy and/or priorities, fiscal constraints, including enforceable spending caps, a sequester or a lack of funding available to pay incurred obligations, or for other reasons.

Further uncertainty with respect to ongoing programs could also result in the event that the U.S.

14 unchanged sentences

If our estimated costs exceed our estimated price, we recognize reach-forward losses which can significantly affect our reported results.

For example, during the year ended December 31, 2022, BDS recorded additional losses on several fixed price development programs.

We continue to experience near-term production disruptions and inefficiencies due to supplier disruption, labor instability and factory performance.

For example, during the year ended December 31, 2023, BDS recorded $1,585 million of additional losses on its five most significant fixed-price development programs (Commercial Crew, KC-46A Tanker, MQ-25, T-7A Red Hawk, and VC-25B Presidential Aircraft).

We continue to experience production disruptions and inefficiencies due to technical challenges, supplier disruption and factory performance.

These factors have contributed to significant earnings charges on a number of fixed-price development programs which are expected to adversely affect cash flows in future periods, and may result in future earnings charges and adverse cash flow effects.

Production and supplier disruptions, inefficiencies, technical challenges, quality issues and labor instability also contributed to lower earnings on fixed-price production programs in 2023.

New programs could also have risk for reach-forward loss upon contract award and during the period of contract performance.

3 unchanged sentences

Estimating costs to complete fixed-price development contracts is generally subject to more uncertainty than fixed-price production contracts.

Many of these development programs have highly complex designs.

In addition, technical or quality issues that arise during development could lead to schedule delays and higher costs to complete, which could result in a material charge or otherwise adversely affect our financial condition.

Examples of significant BDS fixed-price development contracts include Commercial Crew, KC-46A Tanker, MQ-25, T-7A Red Hawk, VC-25B Presidential Aircraft, and commercial and military satellites.

Many of these development programs have highly complex designs and technical challenges.

In addition, technical or quality issues could lead to schedule delays and cost impacts, which could increase our estimated cost to perform the work or reduce our estimated price, either of which could result in a material charge or otherwise adversely affect our financial condition.

We enter into cost-type contracts, which also carry risks.

2 unchanged sentences

These cost-type programs typically have award or incentive fees that are subject to uncertainty and may be earned over extended periods.

In these cases the associated financial risks are primarily in reduced fees, lower profit rates or program cancellation if cost, schedule or technical performance issues arise.

Programs whose contracts are primarily cost-type include Ground-based Midcourse Defense, Proprietary and Space Launch System programs.

In these cases the associated financial risks are primarily reduced award or incentive fees, lower profit rates or program cancellation if cost, schedule or technical performance issues arise.

Examples of programs with cost-type contracts include Ground-based Midcourse Defense, Proprietary and Space Launch System programs.

We enter into contracts that include in-orbit incentive payments that subject us to risks.

7 unchanged sentences

We rely extensively on information technology systems and networks to operate our company and meet our business objectives.

We face various cyber security threats, including attempts to gain unauthorized access to our systems and networks, denial-of-service attacks, threats to our information technology infrastructure, ransomware and phishing attacks, and attempts to gain unauthorized access to our company-, customer- and employee-sensitive information.

These threats come from a variety of actors some of which are highly organized and sophisticated such as nation-state actors and criminal enterprises.

In addition, the techniques used in cyberattacks evolve rapidly, including from emerging technologies, such as advanced forms of automation and artificial intelligence.

As cyber threats increase in volume and sophistication, the risk to the security of these systems and networks – and to the confidentiality, integrity, and availability of the data they house – continues to evolve, requiring constant vigilance and concerted, company-wide risk management efforts.

A cyberattack or security breach, whether experienced directly or through our supply chain, could, among other serious consequences, result in loss of intellectual property;

unauthorized access to various categories of sensitive, proprietary or customer data;

disruption or degradation of business operations, or compromise of products or services.

To address these risks, we maintain an extensive network of technical security controls, policy enforcement mechanisms, monitoring systems and management oversight.

We also have established a Cybersecurity Governance Council to strengthen governance and coordination of cybersecurity activities.

While these measures are designed to prevent, detect and respond to unauthorized activity, there is no guarantee that they will be sufficient to prevent or mitigate the risk of a cyberattack or the potentially serious reputational, operational, or financial impacts that may result.

In November 2022, we discovered a cybersecurity incident that impacted certain systems of Jeppesen, a wholly owned Boeing subsidiary that provides flight planning and navigation services.

We determined that the incident posed no risk to flight safety.

We promptly notified law enforcement, regulatory authorities and customers, launched an investigation, and took additional steps to protect the integrity of our systems.

While this incident has not had a material impact on us, future incidents like this one could have material impact on our business, operations, and reputation.

In addition, we manage information and information technology systems for certain customers and/or suppliers.

Many of these customers and/or suppliers face similar security threats.

If we were unable to protect against the unauthorized access, release and/or corruption of our customers’ and/or suppliers’ confidential, classified or personally identifiable information, our reputation could be damaged, and/or we could face financial or other losses.

A cyber-related attack or security breach, whether experienced directly or through our supply chain or third party-service providers, could, among other serious consequences, result in loss of intellectual property;

allow unauthorized access to or cause the publication of various categories of sensitive, proprietary or customer data;

cause disruption or degradation of our business operations;

compromise our products or services;

and/or result in reputational harm.

To address these risks, we maintain an extensive network of technical security controls, policy enforcement mechanisms, monitoring systems, contractual arrangements, tools and related services, and management and Board oversight.

While these measures are designed to prevent, detect, respond to, and mitigate unauthorized activity, there is no guarantee that they will be sufficient to prevent or mitigate the risk of a cyber-related attack or incident, or allow us to detect, report or respond adequately in a timely manner.

We have experienced, and may in the future experience, whether directly or through our supply chain, third-party service providers or other channels, cybersecurity incidents.

While prior cyber-related attacks and incidents (including those at our wholly-owned subsidiaries Boeing Distribution, Inc.

in 2023 and Jeppesen Inc.

in 2022) have not materially affected our business strategy, results of operations or financial condition, there is no guarantee that a future cyber-related attack or incident would not result in significant operational, regulatory, or financial impacts that could materially affect our business strategy, results of operations or financial condition.

In addition, we manage information and information technology systems for certain customers and suppliers.

Many of these customers and suppliers face similar security threats.

If we were unable to protect against the unauthorized access, release or corruption of our customers’ or suppliers’ confidential, classified or personally identifiable information, we could suffer a loss of business, face regulatory actions or face financial or other losses that could materially affect our business strategy, results of operations or financial condition.

Business disruptions could seriously affect our future sales and financial condition or increase our costs and expenses.

8 unchanged sentences

An adverse resolution of any of these lawsuits, or future lawsuits, could have a material impact on our financial position and results of operations.

In addition, we

are subject to extensive regulation under the laws of the United States and its various states, as well as other jurisdictions in which we operate.

In addition, we are subject to extensive regulation under the laws of the United States and its various states, as well as other jurisdictions in which we operate and/or market our products.

As a result, we are sometimes subject to government inquiries and investigations due, among other things, to our business relationships with the U.S.

4 unchanged sentences

federal, state, local and non-U.S.

laws and regulations related to environmental protection, including the discharge, treatment, storage, disposal and remediation of hazardous substances and wastes.

laws and regulations related to environmental protection, including the discharge, treatment, storage, disposal and remediation of pollutants, hazardous substances and wastes.

We could incur substantial costs, including cleanup costs, fines and civil or criminal sanctions, as well as third-party claims for property damage or personal injury, if we were to violate or become liable under environmental laws or regulations.

6 unchanged sentences

Increasing stakeholder environmental, social and governance (ESG) expectations, physical and transition risks associated with climate change, emerging ESG regulation, contractual requirements, and policy requirements may pose risk to our market outlook, brand and reputation, financial outlook, cost of capital, global supply chain and production continuity, which may impact our ability to achieve long-term business objectives.

Changes in environmental and climate change laws or regulations could lead to additional operational restrictions and compliance requirements upon us or our products, require new or additional investment in product designs, result in carbon offset investments or otherwise could negatively impact our business and/or competitive position.

Increasing aircraft performance standards, increasing sustainability disclosure requirements in the U.S.

and globally, and requirements on manufacturing and product air pollutant emissions, especially greenhouse gas (GHG) emissions, may result in increased costs or reputational risks and could limit our ability to manufacture and/or market certain of our products at acceptable costs, or at all.

Physical impacts of climate change, increasing global chemical restrictions and bans, and water and waste requirements may drive increased costs to us and our suppliers and impact our production continuity and data facilities.

Finally, from time to time, in alignment with our sustainability priorities, we establish and publicly announce goals and commitments to improve our environmental performance, such as our recent operational goals in areas of GHG emissions, energy, water and waste.

If we fail to achieve or improperly report on our progress toward achieving our sustainability goals and commitments, the resulting negative publicity could adversely affect our reputation and/or our access to capital.

Changes in environmental and climate change laws or regulations could lead to additional operational restrictions and compliance requirements upon us or our products, require new or additional investments in production systems or product designs, result in additional carbon offset investments or otherwise negatively impact our business and/or competitive position.

Increasingly stringent aircraft performance standards and requirements including but not limited to manufacturing and product air pollutant emissions, potential carbon pricing mechanisms, and sustainability disclosure requirements in the U.S.

and other jurisdictions may result in increased costs or reputational risks and could limit our ability to manufacture and/or market certain of our products at acceptable costs, or at all.

For example, certain jurisdictions including the State of California and the European Union have enacted legislation which would require more stringent greenhouse gas emissions and climate risk reporting.

Physical impacts of climate change, increasing global chemical restrictions and bans, and

water and waste requirements may drive increased costs to us and our suppliers and impact our production continuity and data facilities.

Finally, from time to time, in alignment with our sustainability priorities, we establish and publicly announce goals and commitments to improve our environmental performance, such as our operational goals in areas of GHG emissions, energy, water and waste.

If we fail to achieve or inadequately report our progress toward achieving such goals and commitments, the resulting negative publicity could adversely affect our reputation and/or our access to capital.

Risks Related to Financing and Liquidity

1 unchanged sentence

We depend, in part, upon the issuance of debt to fund our operations and contractual commitments.

In addition, our debt balances have increased significantly since 2019, driven primarily by impacts related to the 737 MAX grounding and the COVID-19 pandemic, and we expect to continue to actively manage our liquidity.

As of December 31, 2023, our debt totaled $52.3 billion of which approximately $17.7 billion of principal payments on outstanding debt will become due over the next three years.

In addition, as of December 31, 2023, our airplane financing commitments totaled $17.0 billion.

Our increased debt balance resulted in downgrades to our credit ratings in 2020, and our ratings remained unchanged in 2022 and 2021.

If we require additional funding in order to pay off existing debt, address further impacts to our business related to market developments, fund outstanding financing commitments or meet other business requirements, our market liquidity may not be sufficient.

These risks will be particularly acute if we are subject to further credit rating downgrades.

These risks will be particularly acute if we are subject to further credit rating downgrades such as those we experienced in 2020.

A number of factors could cause us to incur increased borrowing costs and to have greater difficulty accessing public and private markets for debt.

11 unchanged sentences

Our estimates of future costs associated with these benefits are also subject to assumptions, including estimates of the level of medical cost increases.

For a discussion regarding how our financial statements can be affected by pension and other postretirement plan accounting policies, see “Management's Discussion and Analysis – Critical Accounting Policies & Estimates – Pension Plans” on page 50 of this Form 10-K.

For a discussion regarding how our financial statements can be affected by pension and other postretirement plan accounting policies, see “Management's Discussion and Analysis – Critical Accounting Estimates – Pension Plans” on pages 47 - 48 of this Form 10-K.

Although under Generally Accepted Accounting Principles in the United States of America (GAAP) the timing of periodic pension and other postretirement benefit expense and plan contributions are not directly related, the key economic factors that affect GAAP expense would also likely affect the amount of cash or stock we would contribute to our plans.

3 unchanged sentences

The amount of our insurance coverage may not cover all claims or liabilities, and we may be forced to bear substantial costs.

For example, liabilities arising from the use of certain of our products, such as aircraft technologies, space systems, spacecraft, satellites, missile systems,

weapons, cybersecurity, border security systems, anti-terrorism technologies and/or air traffic management systems may not be insurable on commercially reasonable terms.

For example, liabilities arising from the use of certain of our products, such as aircraft technologies, space systems, spacecraft, satellites, missile systems, weapons, cybersecurity, border security systems, anti-terrorism technologies and/or air traffic management systems may not be insurable on commercially reasonable terms.

While some of these products are shielded from liability within the U.S.

under the SAFETY Act provisions of the 2002 Homeland Security Act, no such protection is available outside the U.S., potentially resulting in significant liabilities.

See Note 21 of the Consolidated Financial Statements for discussion of legal proceedings resulting from the October 29, 2018 accident of Lion Air Flight 610 and the March 10, 2019 accident of Ethiopian Airlines Flight 302.

The amount of insurance coverage we maintain may be inadequate to cover these or other claims or liabilities.

A significant portion of our customer financing portfolio is concentrated among certain customers and in certain types of Boeing aircraft, which exposes us to concentration risks.

A significant portion of our customer financing portfolio is concentrated among certain customers and in distinct geographic regions.

Our portfolio is also concentrated by varying degrees across Boeing aircraft product types, most notably 717 and 747-8 aircraft, and among customers that we believe have less than investment-grade credit.

A significant portion of our customer financing portfolio, which is comprised of financing receivables and operating lease equipment, is concentrated among certain customers and in distinct geographic regions.

Our portfolio is also concentrated by varying degrees across Boeing aircraft product types, most notably 717 aircraft, and among customers that we believe have less than investment-grade credit.

If one or more customers holding a significant portion of our portfolio assets experiences financial difficulties or otherwise defaults on or does not renew its leases with us at their expiration, and we are unable to redeploy the aircraft on reasonable terms, or if the types of aircraft that are concentrated in our portfolio suffer greater than expected declines in value, our financial position, results of operations and/or cash flows could be materially adversely affected.

Risks Related to Labor

Some of our and our suppliers’ workforces are represented by labor unions, which may lead to work stoppages.

Approximately 50,000 employees, which constitute 32% of our total workforce, were union represented as of December 31, 2022.

We experienced a work stoppage in 2008 when a labor strike halted commercial aircraft and certain BDS program production.

We may experience additional work stoppages in the future, which could adversely affect our business.

We cannot predict how stable our union relationships, currently with 11 U.S.

labor organizations and 12 non-U.S.

labor organizations, will be or whether we will be able to meet the unions’ requirements without impacting our financial condition.

The unions may also limit our flexibility in dealing with our workforce.

Union actions at suppliers can also affect us.

Work stoppages and instability in our union relationships could delay the production and/or development of our products, which could strain relationships with customers and result in lower revenues.

Unresolved Staff Comments

Not applicable

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors