With a growing airline network, rapidly increasing passenger capacity and support from China’s Hangzhou city and the Zhejiang province in which it sits, it looks promising that Hangzhou International Airport will attract leading retail operators and brands for its T4 duty free and duty paid tenders next year.
The duty free outlets are likely to be tendered under one contract as there are not so many companies vying for the business; a symptom of the law in China which does not permit foreign companies to operate duty free shops.
China Duty Free Group already operates outlets in Hangzhou’s existing terminals and David Jea, formerly Deputy General Manager for Hangzhou International Airport, intimates that they stand in a good position to expand their retail footprint into T4.
However, in terms of the duty paid operations, there are likely to be several tenders, breaking up the business into sections.
“Breaking up the duty paid business and opening it up to more bidders does place the onus on the airport, which has to have a clear vision of what will be placed where,” Jea told TRBusiness in an exclusive interview.
As reported, he has since moved back to work for Hong Kong International Airport (HKIA) in the role of Senior Manager, Business Continuity Planning.
“We are in the planning stages right now and have taken on an international consultant.”
For the first sub-phase, with a completion date in 2020, Jea told TRBusiness that he expects a retail duty free concession award to be announced around September 2020.
“Typically, for duty free, we award the business at least a year-and-a-half before opening, so that would mean around September 2020.
“Before then, we’ll have to go through the design process, get that vetted and then seek approval…we will then have to give companies time to bid. So, I believe the tender will take place early next year, probably around March, so that by September we can award.”
By the end of 2022 China’s 10th busiest airport, Hangzhou International Airport, will have increased its passenger capacity to 61m, making it an attractive business proposition to any retailers looking to bid for duty free and duty paid tenders
Construction on the third phase expansion of Hangzhou International Airport, including the new Terminal 4 and the Ground Transportation Centre (GTC), began last year, with an official ceremony taking place as 2018 came to a close.
Terminal 4 alone will span 720,000sq m, but taking the GTC in consideration – which will include offices, hotels, and other ancillary structures – the total footprint will total 1.5 million sq m.
The extensive interview with David Jea will appear in the October issue of TRBusiness. Visitors to the TFWA World Exhibition and Conference can pick up their copy at from the magazine racks on the basement level of the Palais des Festivals as well as in the TFWA’s Innovation Lab, which TRBusiness is sponsoring this year.