Market Presence. The values of the A380 have been experiencing an accelerated decline in recent years such that the annual decline has been greater than the average of 7-8 percent. The age profile of the A380 is such that those aircraft that were leased on 10-12 year terms are now due to expire. While the international market remains buoyant in terms of traffic, this is at the expense of lower air fares and lower yields. Despite the expansion of international traffic, fresh orders for the A380 have not been forthcoming. Indeed, there seems to have been as many cancellations as orders in recent years. The airports have still not become so congested as to force the use of larger aircraft although many operators have moved from the B777-200ER to the B777-300ER. The growth of mega-cities has also seen only modest demand for more A380s. With double digit international passenger growth in April this year then there does seem to be an inevitable need for the use of larger aircraft at some point. Yet, the expansion of the low cost model to intercontinental services using higher density aircraft such as the A330-300 may yet subvert this seeming inevitability.
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