Copyright © 2007 Boeing. All rights reserved.

Company Overview

Boeing is the world’s largest aerospace company and leading manufacturer of commercial airplanes and defense, space and security systems

It supports airlines and U.S. & allied government customers in more than 90 countries

Headquartered out of Chicago Boeing employs more than 160,000 people across the United States and in 70 countries

Products include commercial and military aircraft, satellites, weapons, electronic and defense systems, launch systems, advanced information and communication

Source: 10k http://services.corporate-ir.net/SEC.Enhanced/SecCapsule.aspx?c=85482&fid=7357199

Copyright © 2007 Boeing. All rights reserved.

Industry Overview

Global aerospace and defense industry segmentation:

External Drivers: Federal Funding for Defense Demand from international airlines Industry systems and technology Demand from domestic airlines

Category % Share

Americas 59.1 %

Europe 22.0 %

Asia – Pacific 19.0 %

Total 100 %

Source: Datamonitor Industry Report

Copyright © 2007 Boeing. All rights reserved.

Porters Five Force Analysis

Supplier Power (Moderate) Suppliers are small. However, the high quality inputs provided by suppliers

dilute the bargaining power of players The quality and availability of these inputs is highly important to the quality

of the end products in the aerospace and defense industry, increasing the power of the suppliers

Too many suppliers Buyer Power (Moderate)

Large size of competitors due to merger activity Players are limited as Airbus and Boeing have a virtual duopoly Buyers typically government organizations which flex their financial muscles

to dilute the bargaining power of players

Source: Datamonitor Industry Report

Copyright © 2007 Boeing. All rights reserved.

Porters Five Force Analysis

Threat of New Entrants (Low) High capital outlay and expertise The arms industry has become highly concentrated, nationally and internationally

Threat of Substitutes (Low) No real threat of substitutes in defense and aircrafts, however air freight section

might be affected with increase in concerns of carbon emissions as companies are seeking eco-friendly reputation

Degree of Rivalry (Strong) Due to duopoly, Airbus and Boeing are the sole rivals and they are quite evenly

matched Competition is intense in terms of winning defense contracts and companies use

innovation and new technology to differentiate their service