Customer Financing

3 Months Ended

Mar. 31, 2022

Customer financing primarily relates to the Boeing Capital (BCC) segment. Financing arrangements typically range in terms from 1 to 12 years and may include options to extend or terminate leases. Certain leases include provisions to allow the lessee to purchase the underlying aircraft at a specified price.

Customer financing consisted of the following:


	March 31 2022	December 31 2021
Financing receivables:
Investment in sales-type/finance leases	$886	$944
Notes	410	412
Total financing receivables	1,296	1,356
Less allowance for losses on receivables	(66)	(18)
Financing receivables, net	1,230	1,338
Operating lease equipment, at cost, less accumulated depreciation of $62 and $58	507	474

Total	$1,737	$1,812

At March 31, 2022 and December 31, 2021, $412 and $378 were determined to be uncollectible financing receivables and placed on non-accrual status. The increase in the allowance for losses on receivables during the three months ended March 31, 2022 was primarily due to impacts of the war in Ukraine. Customer financing interest income received was $3 and $6 the three months ended March 31, 2022 and 2021.

Customer financing receivables past due as of March 31, 2022 were $1.

Our financing receivable balances at March 31, 2022 by internal credit rating category and year of origination consisted of the following:


Rating categories	Current	2021	2020	2019	2018	Prior	Total
BBB						$98	$98
BB	$9	$231	$118	$42	$13	121	534
B		35				188	223
CCC			7	24		410	441


Total carrying value of financing receivables	$9	$266	$125	$66	$13	$817	$1,296

At March 31, 2022, our allowance for losses related to receivables with ratings of CCC, B, BB, and BBB. We applied default rates that averaged 88.1%, 26.8%, 3.4%, and 0.1%, respectively, to the exposure associated with those receivables.

Customer Financing Exposure

The majority of our customer financing portfolio is concentrated in the following aircraft models:


	March 31 2022	December 31 2021
717 Aircraft ($58 and $62 accounted for as operating leases)	$589	$603
747-8 Aircraft (accounted for as sales-type finance leases)	394	435
737 Aircraft ($186 and $145 accounted for as operating leases)	204	163
777 Aircraft ($221 and $225 accounted for as operating leases)	229	233
MD-80 Aircraft (accounted for as sales-type finance leases)	140	142
757 Aircraft (accounted for as sales-type finance leases)	121	126
747-400 Aircraft ($0 and $1 accounted for as operating leases)	48	50

Operating lease equipment primarily includes large commercial jet aircraft.

Lease income recorded in revenue on the Condensed Consolidated Statements of Operations for the three months ended March 31, 2022 and 2021 included $18 and $13 from sales-type/finance leases, and $15 and $18 from operating leases, of which $4 and $2 related to variable operating lease payments. Profit at the commencement of sales-type leases was recorded in revenue for the three months ended March 31, 2022 and 2021 in the amount of $4 and $16.