NEW ZEALAND. Auckland Airport’s retail income for the full year ending 30 June 2023 rose by +476.7% to NZ$130.9 million (US$77.8 million) as all stores in the international terminal reopened post the pandemic.
That represents 58% of 2019 numbers (NZ$225.8 million). Retail income per passenger surged by +105% to NZ$8.41 (US$5.00), which compares to NZ$10.96 (US$6.52) in the 2019 financial year.
Overall airport revenues increased by +108% year-on-year to NZ$625.9 million (US$373.6 million), about 85% of pre-pandemic levels. But the airport company’s net profit was down -77% to NZ$43.2 million (US$25.7 million).
Auckland Airport Chair Patrick Strange said: “It’s been a year marked by the strong return of international travel, with new airlines and routes, getting underway with the most significant upgrade of Auckland Airport in history and making progress on sustainability initiatives that will have a meaningful impact across the aviation precinct.”
Passenger traffic in 2023 reached 15.9 million, up +183% year-on-year.
The airport registered a +90% growth in domestic passenger numbers to 8.1 million, while international passenger numbers (including transits) increased +480% to 7.8 million.
Retail resurgence
Auckland Airport has made steady progress in a range of key developments across transport, retail and commercial property during the year.
The company said its retail community is back in full swing. It houses more than 115 retailers inside the terminals, including 20 different food & beverage operators.
As reported, Aelia Duty Free (owned by Lagardère Travel Retail) is now the airport’s single duty free retailer after being granted a contract extension until mid-2025. Initially scheduled for September this year, the airport’s shift to a single operator was brought forward by three months with the agreement of all parties (including Aer Rianta International, the former rival incumbent) to ensure a seamless transition, Auckland Airport noted in its annual report.
Auckland Airport Chief Executive Carrie Hurihanganui said: “Not only is a single operator model in line with most overseas airports, it also creates the opportunity for the introduction of additional retail lines and improved in-store experiences. In what was a seamless transition, around 90% of existing duty free employees were able to transfer to Aelia Duty Free.”
Another retail attraction set to open in late 2024 is the premium outlet shopping destination Mānawa Bay. Auckland Airport is also set to unveil the five-star Te Arikinui Pullman Hotel.
Hurihanganui said: “Later this year Te Arikinui Pullman Hotel (a joint venture between Auckland Airport and Tainui Group Holdings) will open, followed by the first stages of the Transport Hub opening up for drop-offs and pick-ups in the new year.
“During the 2024 calendar year we’ll be providing new parking options with the opening of Park & Ride South; and offering a new shopping experience to visitors with the opening of Mānawa Bay premium outlet shopping destination, expected in late 2024.”
Additionally, the airport continued to attract more tenants including IKEA, DHL and Reece Group, which will have their standalone facilities within The Landing – one of the fastest-growing commercial areas located at the northern end of the airport. Construction is slated to begin in the 2024 financial year.
Rebuilding connections
Auckland Airport underlined a stronger-than-anticipated rebound in domestic and international aviation markets during the year. By the end of fiscal 2023, international seat capacity returned to 90% of pre-pandemic traffic and domestic recovered to 89%.
As of June 2023, the airport hosted 25 airlines serving 40 destinations, up from just 12 airlines and 21 destinations when borders were closed.
Hurihanganui said: “We still have some way to go to achieving full recovery, but it all amounts to a fantastic turnaround for an industry that was in dire straits two years ago – bringing relief and optimism to those of us who work in aviation.
“Strength in North American services has been leading the charge. Air New Zealand now flies into seven North American cities including its flagship New York service, joined by Qantas on the same route from June 2023, bringing greater choice and more competitive pricing to travellers.
“Hawaiian Airlines, Air Canada, United Airlines and American Airlines reconnecting into Auckland will also be joined by newcomer Delta Air Lines over the summer from October this year.
“It will be a busy summer with current projections showing capacity between Auckland and North America set to exceed 2019 levels, with a forecast +29% increase over November 2023 to March 2024 compared to the same five-month period prior to COVID-19.”
The resumption of outbound travel for Chinese tourists has further boosted passenger traffic recovery. Since China has reopened its borders, five airlines now fly four routes, including daily services to some of the main destinations. In 2023, capacity between China and New Zealand recovered to 78% of 2019 levels and is predicted to achieve 93% of pre-pandemic levels by September.
Hurihanganui added: “There was plenty of activity on the trans-Tasman route, by far our biggest international market, which is back to 96% of pre-pandemic capacity. Frequent flyers Air New Zealand, Qantas and Jetstar have been joined by AirAsia X flying between Auckland and Sydney, with Batik Air starting on the Perth route tomorrow.” ✈
