Commitments And Contingencies | Commitments and Contingencies Environmental The following table summarizes environmental remediation activity during the three months ended March 31, 2016 and 2015 . 2016 2015 Beginning balance – January 1 $566 $601 Reductions for payments made (7 ) (16 ) Changes in estimates 19 5 Ending balance – March 31 $578 $590 The liabilities recorded represent our best estimate or the low end of a range of reasonably possible costs expected to be incurred to remediate sites, including operation and maintenance over periods of up to 30 years. It is reasonably possible that we may incur charges that exceed these recorded amounts because of regulatory agency orders and directives, changes in laws and/or regulations, higher than expected costs and/or the discovery of new or additional contamination. As part of our estimating process, we develop a range of reasonably possible alternate scenarios that includes the high end of a range of reasonably possible cost estimates for all remediation sites for which we have sufficient information based on our experience and existing laws and regulations. There are some potential remediation obligations where the costs of remediation cannot be reasonably estimated. At March 31, 2016 and December 31, 2015 , the high end of the estimated range of reasonably possible remediation costs exceeded our recorded liabilities by $873 and $853 . Product Warranties The following table summarizes product warranty activity recorded during the three months ended March 31, 2016 and 2015 . 2016 2015 Beginning balance – January 1 $1,485 $1,504 Additions for current year deliveries 92 116 Reductions for payments made (79 ) (91 ) Changes in estimates (25 ) (17 ) Ending balance - March 31 $1,473 $1,512 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 March 31, 2016 have expiration dates from 2016 through 2026 . At March 31, 2016 , and December 31, 2015 total contractual trade-in commitments were $1,718 and $1,585 . As of March 31, 2016 and December 31, 2015 , we estimated that it was probable we would be obligated to perform on certain of these commitments with net amounts payable to customers totaling $248 and $240 and the fair value of the related trade-in aircraft was $248 and $240 . Financing Commitments Financing commitments related to aircraft on order, including options and those proposed in sales campaigns, totaled $17,026 and $16,283 as of March 31, 2016 and December 31, 2015 . The estimated earliest potential funding dates for these commitments as of March 31, 2016 are as follows: Total April through December 2016 $2,706 2017 4,421 2018 3,625 2019 2,994 2020 1,181 Thereafter 2,099 $17,026 As of March 31, 2016 , $17,021 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. Standby Letters of Credit and Surety Bonds We have entered into standby letters of credit and surety bonds with financial institutions primarily relating to the guarantee of our future performance on certain contracts. Contingent liabilities on outstanding letters of credit agreements and surety bonds aggregated approximately $4,541 and $4,968 as of March 31, 2016 and December 31, 2015 . Commitments to ULA We and Lockheed Martin Corporation have each committed to provide ULA with additional capital contributions in the event ULA does not have sufficient funds to make a required payment to us under an inventory supply agreement. As of March 31, 2016 , ULA’s total remaining obligation to Boeing under the inventory supply agreement was $120 . See Note 4 . F/A-18 At March 31, 2016 , our backlog included 40 F/A-18 aircraft under contract with the U.S. Navy. The Consolidated Appropriations Act, 2016, passed in December 2015, funds 12 additional F/A-18 aircraft that, combined with the orders in backlog, would complete production in mid-2018. The President’s Fiscal Year 2017 Budget request submitted in February 2016 includes funding for two additional F/A-18 aircraft. In March 2016, the Navy included 14 F/A-18 aircraft in its unfunded priorities list submitted to the congressional defense committees for funding consideration. We are continuing to work with our U.S. customers as well as international customers to secure additional orders that would extend the program beyond 2018. Should additional orders not materialize, it is reasonably possible that we will decide to end production of the F/A-18 in 2018. We are still evaluating the full financial impact of a potential production shutdown, including any recovery that may be available from the U.S. government. United States Government Defense Environment Overview The enactment of The Bipartisan Budget Act of 2015 in November 2015 established overall defense spending levels for FY2016 and FY2017. However, uncertainty remains with respect to levels of defense spending for FY2018 and beyond including risk of future sequestration cuts. Significant uncertainty also continues with respect to program-level appropriations for the U.S. Department of Defense ( U.S. DoD ) and other government agencies, including the National Aeronautics and Space Administration, within the overall budgetary framework described above. Future budget cuts, including cuts mandated by sequestration, or future procurement decisions associated with the authorization and appropriations process could result in reductions, cancellations and/or delays of existing contracts or programs. Any of these impacts could have a material effect on the results of the Company's operations, financial position and/or cash flows. In addition to the risks described above, if Congress is unable to pass appropriations bills in a timely manner, a government shutdown could result which may have impacts above and beyond those resulting from budget cuts, sequestration impacts or program-level appropriations. For example, requirements to furlough employees in the U.S. DoD or other government agencies could result in payment delays, impair our ability to perform work on existing contracts, and/or negatively impact future orders. KC-46A Tanker and BDS Fixed-Price Development Contracts Fixed-price development work is inherently uncertain and subject to significant variability in estimates of the cost and time required to complete the work. BDS fixed-price contracts with significant development work include Commercial Crew, Saudi F-15, USAF KC-46A Tanker and commercial and military satellites. The operational and technical complexities of these contracts create financial risk, which could trigger termination provisions, order cancellations or other financially significant exposure. Changes to cost and revenue estimates could result in lower margins or material charges for reach-forward losses. For example, during the first quarter of 2016, we recorded additional reach-forward losses of $243 on the KC-46A Tanker program. KC-46A Tanker In 2015, we began work on low rate initial production aircraft for the U.S. Air Force (USAF). The USAF is expected to authorize two low rate initial production lots in 2016 for a total of 19 aircraft, subject to satisfactory progress being made on the Engineering, Manufacturing and Development contract. At March 31, 2016 , we had approximately $812 of capitalized precontract costs and $1,789 of potential termination liabilities to suppliers associated with the USAF KC-46A Tanker. Recoverable Costs on Government Contracts Our final incurred costs for each year are subject to audit and review for allowability by the U.S. government, which can result in payment demands related to costs they believe should be disallowed. We work with the U.S. government to assess the merits of claims and where appropriate reserve for amounts disputed. If we are unable to satisfactorily resolve disputed costs, we could be required to record an earnings charge and/or provide refunds to the U.S. government. Russia/Ukraine We continue to monitor political unrest involving Russia and Ukraine, where we and some of our suppliers source titanium products and/or have operations. A number of our commercial customers also have operations in Russia and Ukraine. To date, we have not experienced any significant disruptions to production or deliveries. Should suppliers or customers experience disruption, our production and/or deliveries could be materially impacted. 747 Program During the fourth quarter of 2015, we recorded a charge of $885 to recognize a reach-forward loss on the 747 program primarily due to slower than expected growth in global cargo markets, resulting in market and pricing pressures and fewer orders than anticipated driving reductions in our planned production rates. The charge was primarily related to lower anticipated revenues reflecting ongoing pricing and market pressures as well as higher estimated costs due to the reduction in the production rate from 1.0 per month to 0.5 per month in September 2016. We currently plan to return to a rate of 1.0 per month in 2019. During the first quarter of 2016, an additional reach-forward loss of $70 was recorded to reflect lower estimated revenue from future sales . We have a number of completed aircraft in inventory as well as unsold production positions and we remain focused on obtaining additional orders and implementing cost-reduction efforts. If we are unable to obtain sufficient orders in 2016 and/or market, production and other risks cannot be mitigated, we could record additional losses that may be material. 787 Program The 787 program continues to have near breakeven gross margins. The combination of production challenges, change incorporation on early build aircraft, schedule delays, customer and supplier impacts and changes to price escalation factors has created significant pressure on program profitability. If risks related to this program, including risks associated with productivity improvements, supply chain management, planned production rate increases or introducing and manufacturing the 787-10 derivative as scheduled cannot be mitigated, the program could face additional customer claims and/or supplier assertions, as well as a reach-forward loss that may be material. |