So, the air in the Gulf is really normal. Reality works there too. This news is not unexpected and of course, post the Paris show, it can be swept under the carpet of “new news”. But the truth is that analysts need to reflect on this information.
DAE Capital cancelled its remaining aircraft orders with Airbus in the latest sign of disruption at the majority state-owned Dubai leasing company. The leasing firm, whose CEO stepped down on June 30, cancelled orders for 45 aircraft worth $5.8bn at list prices, according to Airbus’ monthly order update.
DAE previously canceled Airbus orders worth $4.7bn and some Boeing orders in March. The move draws attention to the remaining Boeing orders. Boeing is expected to update its order data today, and has outstanding orders for 56 aircraft from DAE.
DAE Capital is 23% owned by state-linked DIFC Investments. Other shareholders include Dubai’s sovereign wealth arm, Investment Corporation of Dubai. This news reflects rather poorly on the Emirate that just yesterday announced a huge development program to create a global aviation hub. If analysts cast a jaundiced eye on yesterday’s news, then today’s news seems to be a support for questioning the perpetual sunrise view that is extant in Dubai. And questioning Dubai’s grandiose plans is fine because it is subject to the same laws of economics.