Boeing 2012 Annual Report Download - page 25

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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 and/or form joint ventures and
strategic alliances. Whether we realize the anticipated benefits from these acquisitions and related activities
depends, in part, upon our ability to integrate the operations of the acquired business, the performance
of the underlying product and service portfolio, and the performance of the management team and other
personnel of the acquired operations. Accordingly, our financial results could be adversely affected from
unanticipated performance issues, legacy liabilities, 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 reported 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. We
also may make strategic divestitures from time to time. These transactions 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 through additional payment obligations, higher costs or asset write-downs.
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. For example, liabilities arising from the use of certain of our products, such as
aircraft technologies, missile systems, 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.
The amount of insurance coverage we are able to maintain may be inadequate to cover these or other
claims or liabilities.
Business disruptions could seriously affect our future sales and financial condition or increase
our costs and expenses.
Our business may be impacted by disruptions including threats to physical security, information technology
or cyber-attacks or failures, damaging weather or other acts of nature and pandemics or other public health
crises. Any of these disruptions could affect our internal operations or our ability to deliver products and
services to our customers. Any significant production delays, or any destruction, manipulation or improper
use of our data, information systems or networks could impact our sales, increase our expenses and/or
have an adverse affect the reputation of Boeing and of our products and services.
Some of our and our suppliers’ workforces are represented by labor unions, which may lead to
work stoppages.
Approximately 68,000 employees, which constitute 39% of our total workforce, are union represented as
of December 31, 2012. We experienced a work stoppage in 2008 when a labor strike halted commercial
aircraft and certain BMA program production and we may experience additional work stoppages in the
future, which could adversely affect our business. We cannot predict how stable our relationships, currently
with 12 U.S. labor organizations and 6 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