One interesting thing is that Airfix (owned by Hornby) seem to be doing well, at least as far as releasing new kits goes. My interest in building plastic kits was recently rekindled after about 15 years when Gaynor got me a Battlestar Galactica Viper a couple of Christmasses ago. While I'm not building them at the rate my teenage self did, I've done a few others since then, and found that somewhat inevitably there are vibrant, informative and irredeemably geeky online communities devoted to the subject. The general concensus is that most of the new kits that Airfix are releasing are very good indeed, and are competing well against the far east alternatives, not least because exchange rates mean that the prices of the big Japanese brands are getting ridiculous.
I'm not sure if The Kids are buying them, but there seem to be plenty of middle-aged men with disposable income enough to buy multiple copies of the kits that interest them, and the time and inclination to spend hours arguing on the internet about the exact shade of sky blue used on the underside of Spitfires on July 17th, 1940.
It is a waste, on the other hand, you don't end up having a shelf-load of dusty plastic things slowly getting bits knocked off them. When I was making models first time round, the shelves of models were a constant reminder that I should have been using my time to do more interesting things, so I kind of resented them.
This time round, I've got plenty of other interesting things to be doing, so I don't feel resentful.
Maybe there's some sort of compromise to be had where the shelf is actually a very slow-moving conveyor belt which takes a year to roll something from one end to the other, and there's a bin at the end of it.