“After extensive as well as intensive negotiations with various airlines including British Airways, Hi Fly and Iran Air, Dr. Peters Group has decided to sell the aircraft components and will recommend this approach to investors,” the German lessor announced in early June. Read More » The two aircraft are A380s returned to the lessor after their leases of 10 years expired.

“From Dr. Peters Group’s point of view, the alternative options negotiated for new aircraft lease agreements did not meet investors’ requirements to achieve a suitable result. Even a sale of the aircraft, which also had been considered, did not meet the conditions demanded by the Dr. Peters Group,” a June statement said.

The lessor said it would be working with VAS Aero Services on the sale of the components alone and expected to earn US$45 million during the two-year sale process. “The main reason for this high assessment is that many airlines currently fly the A380-800 and will have a high demand for individual replacement components due to upcoming maintenance intervals,” it said.

The group planned to extend the existing engine leasing agreement with Rolls-Royce, or with an airline, beyond March next year and sell the propulsion units by December 2020.

Average returns for investors from the two leased A380s to SIA were 145%-155%, including realized currency gains. Landing gear and the auxiliary engine should be sold quickly, the lessor said, with initial payment expected to be made to investors in the first quarter of 2019.

“The market for the A380-800 has not developed positively in recent years. Some airlines have cancelled orders from Airbus while others have opted for smaller long-haul jets. Finally, the ongoing negative discussion about the A380-800 has not led airlines to increasingly rely on this type of aircraft,” Dr. Peters Group CEO, Anselm Gehling, said.

“In light of this development, the concept that has been finalized has a total revenue forecast of US$80 million per aircraft.”