Boeing 2009 Annual Report Download - page 24

A substantial deterioration in the financial condition of the commercial airline industry or
significant changes to the financial or regulatory landscape could have a significant impact on
Boeing Capital Corporation, which could in turn have an adverse effect on our earnings, cash
flows and/or financial position.
BCC, our wholly-owned subsidiary, has substantially all of its portfolio concentrated among commercial
airline customers. If terrorist attacks, a serious health epidemic, significant regulatory actions in
response to environmental concerns, increases in fuel related costs or other exogenous events were to
have an adverse impact on the airline industry, increased requests for financing, significant defaults by
airline customers, repossessions of aircraft and/or airline bankruptcies and restructurings could
negatively impact the strength of BCC’s portfolio and our operating results. In addition, a significant
deterioration in the aircraft financing environment, or significant regulatory reforms that increase costs
to companies like BCC, could impact BCC’s financial position and operating results. Any of these
events could have a negative effect on our earnings, cash flows and/or financial position.
We may be unable to obtain debt to fund our operations and contractual commitments at
competitive rates, on commercially reasonable terms or in sufficient amounts.
We depend, in part, upon the issuance of debt to fund our operations and contractual commitments. If
we were called upon to fund all outstanding financing commitments, our market liquidity may not be
sufficient. A number of factors could cause us to incur increased borrowing costs and to have greater
difficulty accessing public and private markets for debt. These factors include disruptions or declines in
the global capital markets and/or a decline in our financial performance or outlook or credit ratings. The
occurrence of any or all of these events may adversely affect our ability to fund our operations and
contractual or financing commitments.
We may not realize the anticipated benefits of mergers, acquisitions, joint ventures/strategic
alliances or divestitures.
As part of our business strategy, we may merge with or acquire businesses, form joint ventures/
strategic alliances and divest operations. Whether we realize the anticipated benefits from these
transactions depends, in part, upon the integration between the businesses involved, the performance
of the underlying products, capabilities or technologies and the management of the transacted
operations. Accordingly, our financial results could be adversely affected from unanticipated
performance issues, transaction-related charges, amortization of expenses related to intangibles,
charges for impairment of long-term assets, credit guarantees, partner performance and
indemnifications. Consolidations of joint ventures could also impact our results of operations or
financial position. While we believe that we have established appropriate and adequate procedures
and processes to mitigate these risks, there is no assurance that these transactions will be successful.
Divestitures may result in continued financial involvement in the divested businesses, such as through
guarantees or other financial arrangements, following the transaction. Nonperformance by those
divested businesses could affect our future financial results.
Our insurance coverage may be inadequate to cover all significant risk exposures.
We are exposed to liabilities that are unique to the products and services we provide. While we
maintain insurance for certain risks and, in some circumstances, we may receive indemnification from
the U.S. government, insurance cannot be obtained to protect against all risks and liabilities. It is
therefore possible that the amount of our insurance coverage may not cover all claims or liabilities, and
we may be forced to bear substantial costs.
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