UAE. DFS Group, the incumbent duty free retailer at Abu Dhabi International Airport, has responded to the surprise news (revealed by The Moodie Davitt Report yesterday) that Abu Dhabi Airports is putting its Southside Master Duty Free concession out to tender.
The tender covers all the existing terminal business at the airport but not the Midfield Terminal (where Lagardère Capital has been awarded the liquor & tobacco, confectionery and fine foods concession and Aer Rianta International the perfumes, cosmetics, skincare, sunglasses and jewellery contract) , which is now expected to open in 2019. We’ll bring you a separate update on the hugely ambitious Midfield Terminal development, including latest video coverage, later today.
DFS Group’s current concession expires in July 2018. The new Southside contract will run from then until a date agreed between the two parties. Given the likely short-term nature of the new concession the likeliest bidders would seem to be the incumbent and possibly the Midfield winners, Aer Rianta International and Lagardère Capital. However the fate of the existing terminals has not yet been finalised.
DFS said in a statement supplied to The Moodie Davitt Report: “We were informed about Abu Dhabi Airports’ decision to issue an RFP for the existing terminal business last week. Of course we intend to continue to partner with Abu Dhabi International Airport and support their planned developments. At the same time, we are analysing the changing landscape of traveller patterns in the Middle East region, and how this is impacting different airlines and airports, to better inform our strategy.”
The latter part of the statement is a likely reference to numerous pressures on the Middle East aviation market, particularly on the Abu Dhabi flagship carrier Etihad. Etihad posted a US$1.87 billion loss in 2016 after a one-off impairment on aircraft and equity investments in partner airlines Alitalia and AirBerlin outweighed a +6% increase in passenger traffic to a record 18.5 million passengers.
About the Southside tender
The concession includes all core categories except speciality retail, the pharmacy, news & books, gold and a cigar outlet.
Responses to the EOI are due by 12 noon on 17 August. The contract will run from opening until a date agreed between the two parties.
Companies which submit an Expression of Interest and meet the pre-RFP criteria will be invited to take part in the subsequent RFP.
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