What's going on?

The Dubai Air Show opened on Sunday. Two years ago, the first day of the show saw a record $162 billion of orders for new aircraft. This year? Zero.

What does this mean?

Orders for new aircraft have soared for about the past decade, but momentum appears to have stalled. The market is now showing signs of being oversupplied. Prices for used planes have come down a lot and that is likely helping to dampen demand for new planes. Also, the lower cost of oil�helps to keep older planes in operation because spending money on new, more fuel-efficient planes becomes less financially attractive. All in all, while there is clearly still demand for new aircraft, the boom of the past decade might be ending.

Why should I care?

1. The bigger picture: What goes up, must come down. The airline industry has historically been very �cyclical.� That means it has often overestimated demand for travel and, therefore, over-ordered planes. That might be what has occurred recently, hence the impact now on the aircraft industry.
2. For the stocks: Declining orders would likely be bad for Boeing and Airbus. Boeing and Airbus are, by far, the world�s largest aircraft manufacturers. While both companies maintain that demand for their aircraft is healthy, if they are wrong, their share prices will likely hit turbulence over the medium-term.