2020 Boeing Pilot & Technician Outlook

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Proprietary: The information contained herein is proprietary to The Boeing Company and shall not be reproduced or disclosed in whole or in part except when such user possesses direct written authorization from The Boeing Company.

The statements contained herein are based on good faith assumptions are to be used for general information purposes only. These statements do not constitute an offer, promise, warranty or guarantee of performance.

2020 Boeing Pilot & Technician Outlook

Tom Wagner | Senior Manager of Maintenance Training

November 10, 2020

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Pilot and Technician Outlook methodology

Crew requirements

Regulatory requirements

Operator business models Aircraft

utilization Aircraft Market

Outlook

Pilot and Technician Outlook Methodology

2020 – 2039

Pilot & Technician

Outlook

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Commercial aviation dramatically impacted by global pandemic

Passenger flights

~50%

of normal

Passenger traffic

~ 25%

of normal

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Varied recovery paths across regions so far

SOURCES: Weekly level of passenger operations through Week 38 (9/13 - 9/19) FlightRadar24, BR&T Europe, Boeing Normalized based on 1/12-18 operations

North America Latin

America Africa

Europe

(incl. Central Asia)

Middle East Other

Asia Pacific

China World

27% 80% 33% 60% 44% 35% 55% 54%

0%

20%

40%

60%

80%

100%

120%

M a r M a y Ju l S e p M a r M a y Ju l S e p M a r M a y Ju l S e p M a r M a y Ju l S e p M a r M a y Ju l S e p M a r M a y Ju l S e p M a r M a y Ju l S e p M a r M a y Ju l S e p

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Domestic markets leading the recovery

August Domestic August International

49%

of 2019

12%

of 2019

SOURCE: IATA

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Key themes

Resilience

of air

travel demand

Recruitment

to support

attrition replacement and fleet growth

Transformation

to enable

better training outcomes

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Aviation proven resilient over and over again

0 2 4 6 8 10 12

Actual Traffic, RPKs Scenario Trend

RP K s (tr illi o n s)

Market has returned to trend within 2-3 years

of all major shocks

RPKs = Revenue Passenger Kilometers

SOURCES: ICAO scheduled traffic through 1999 / 2000-2019E IATA stats / 2020F IATA December 2019

9/11 event

~3 Years

Global financial crisis

~2 Years

COVID-19 event

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$- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000

M ill ion s

Maintenance Spend Linear (Maintenance Spend)

Di rect Ma int e n a n ce S p e n d (M illi o n s US D )

Maintenance demand will rebound

9/11 event

~3 Years

Global financial crisis

~2 Years

SOURCE: U.S. DOT Form 41

Ongoing maintenance required for parked

airplanes

Trend

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Technician retirements expected to surge

33% of U.S. aircraft mechanics are over the

age of 60

SOURCE: ATEC 2019-2020 Pipeline Report, FAA Airmen Certification Branch

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Commercial airplane demand continues to grow

Fleet by region

Forecast period: 2020-2039

*Does not include China

Asia Pacific*

North America

Europe Middle

East

Latin America Russia/Central

Asia

Africa

0 10,000 20,000 30,000 40,000 50,000

2019 2039

21%

6% 3%2%

7%

20%

21%

Asia Pacific*

North America Europe

Middle East

Latin America Russia &

Central Asia Africa

New airplane deliveries by region

43,110 ^25,900

48,400

20%

China

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After 9/11 & SARS (5-year average)

After Great Financial Crisis (5-year average)

"Average" times

44%

56%

48%

40%

45%

50%

55%

60%

CMO 2019 CMO 2020 - 10 year

CMO 2020 - 20 year

Shocks accelerate fleet retirements and replacement

Average annual fleet retirement rates

Replacement as share of deliveries

2-3%

~4%

4-5%

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Training will undergo a transformation

Fleet modernization will impact training requirements

Technology enabling analytics, predictive maintenance

Rapid shift to online learning due to COVID-

related restrictions

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2020-2039

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Summary…

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