Boeing 2013 Annual Report Download - page 91

Download and view the complete annual report

Please find page 91 of the 2013 Boeing annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 148

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148

79
Product Warranties
The following table summarizes product warranty activity recorded during the years ended December 31,
2013 and 2012.
2013 2012
Beginning balance – January 1 $1,572 $1,046
Additions for current year deliveries 595 678
Reductions for payments made (419) (315)
Changes in estimates (178) 163
Ending balance - December 31 $1,570 $1,572
Commercial Aircraft Commitments
In conjunction with signing definitive agreements for the sale of new aircraft (Sale Aircraft), we have entered
into trade-in commitments with certain customers that give them the right to trade in used aircraft at a
specified price upon the purchase of Sale Aircraft. The probability that trade-in commitments will be
exercised is determined by using both quantitative information from valuation sources and qualitative
information from other sources. The probability of exercise is assessed quarterly, or as events trigger a
change, and takes into consideration the current economic and airline industry environments. Trade-in
commitments, which can be terminated by mutual consent with the customer, may be exercised only during
the period specified in the agreement, and require advance notice by the customer.
Trade-in commitment agreements at December 31, 2013 have expiration dates from 2014 through 2023.
At December 31, 2013 and 2012, total contractual trade-in commitments were $1,605 and $1,535. As of
December 31, 2013 and 2012, we estimated that it was probable we would be obligated to perform on
certain of these commitments with net amounts payable to customers totaling $325 and $108 and the fair
value of the related trade-in aircraft was $325 and $108.
Financing Commitments
Financing commitments related to aircraft on order, including options and those proposed in sales
campaigns, totaled $17,987 and $18,083 as of December 31, 2013 and 2012. The estimated earliest
potential funding dates for these commitments as of December 31, 2013 are as follows:
Total
2014 $2,309
2015 2,914
2016 3,257
2017 3,026
2018 1,930
Thereafter 4,551
$17,987
As of December 31, 2013 all of these financing commitments related to customers we believe have less
than investment-grade credit. We have concluded that no reserve for future potential losses is required
for these financing commitments based upon the terms, such as collateralization and interest rates, under
which funding would be provided.