Fewer requests for proposals expected over the next few years, says DFW

By Andrew Pentol |

Dallas Forth Worth is offering concessionaires US$120 million to help ensure they are well positioned to capitalise on the recovery.

Dallas Fort Worth International Airport (DFW) has praised the ‘resilience and flexibility’ of its concessionaire partners during the coronavirus (Covid-19) pandemic and suggested it is ‘fortunate’ to have experienced just a 40% traffic drop to date compared to 2019.

Participating as part of The CEO Chair interview series at the 2021 Summit of the Americas (5-9 April), Sean Donohue, CEO, Dallas Fort Worth International Airport was the subject of a recorded interview with moderator Dermot Davitt of the Moodie Davitt Report.

The interview was aired today (6 April) to kick off the educational programme on day two of the Summit. As reported, the industry was urged to seize on the dynamic advantages it possesses to enrich the customer experience and to stay competitive during the opening session on day one.

“It has been a very difficult time for our concession partners. This is why we are providing them with US$120 million worth of support,” Donohue remarked. “Another reason we are offering them this support is because we want our concessionaires to be in a place where they can serve our customers when traffic comes back.”

The support package for concessionaires was first introduced in March/April 2020. It was recently decided that tenants will continue receiving assistance until September 2021, by which point DFW will have distributed US$120 million in financial support.

FEWER REQUESTS FOR PROPOSAL EXPECTED

Donohue, who revealed almost two thirds of concessionaires have remained open since July/August added: “I have been doing a fair amount of travel in the past year. When I go to airports and only see a handful of concessionaires open, I start to ask myself if those concessionaires will be there to help customers when the recovery happens.”

Looking ahead, Donohue does not expect DFW to launch as many requests for proposals as it would under normal circumstances. “We are not sure if our concessionaires have the capital to put into new programmes over the next couple of years. It is important we recognise that and be sensitive to it.

“This is why we have obtained approval from our Board to extend all our concessionaire contracts by two years to provide certainty and some assurance.”

Donohue also praised Ken Buchannan, Executive Vice President, Revenue Management and Customer Experience and Zenola Campbell, Vice President Concessionaires, for their work with concessionaires during this period.

“They have both done a fantastic job, not only in terms of supporting our concessionaire partners, but in the way they have communicated with them, shared information with them and listened to them.”

On the importance of commercial concessionaires — many of which are minority-owned businesses — Donohue recalled how the airport supported them right from the outset.

“We took steps early on and were one of the first airports to eliminate minimum annual guarantees. We did this in six-month increments and will continue to adopt this policy as we don’t know when the recovery will happen.”

Dermot Davitt of The Moodie Davitt Report posed the questions in a pre-recorded interview with Sean Donohue, CEO, Dallas Fort Worth International Airport.

In the short-term, DFW is preparing for summer domestic traffic to reach 80% of pre-crisis levels.

“If domestic traffic this summer does recover to 80% of what it was before the pandemic, our belief is that the majority of concessionaires will be open and be able to serve our customers.”

As mentioned above, DFW believes it is fortunate not to have suffered a far greater traffic decline during the pandemic. Donohue, who believes domestic traffic at DFW will completely recover by spring 2022 explained: “The reason we feel fortunate is because many of the coastal international gateways in the US have experienced traffic decreases of 60% to 70%.

“We are fortunate that American Airlines has favoured DFW as the airline has recovered.”

Reflecting on the airport’s general handling of the pandemic, ensuring the safety of travellers and employees was first priority. “People were still travelling even last summer,” Donohue acknowledged. “There were days in July/August when we had 150,000 people travelling through the airport on a daily basis. We wanted to ensure we were taking good care of them and that they felt confident and safe.”

Sanitisation and cleanliness programmes became priority in the customer terminals and across employee facilities.

“Like most airports, we have used technology. Once of our big investments was the ultraviolet lighting which kills the germs. This was implemented in all our heating and air conditioning systems throughout the terminals.”

Dallas Fort Worth International Airport has supported its concessionaires throughout the pandemic.

While technology continues to play a crucial role in terms of sanitisation, it is not noticed by customers, according to Donohue. “We started what we call a strike team. This involved hiring around 150 people, putting them in very visible uniforms and having them out in the terminals cleaning the high-touch areas.

“This was more reassuring to customers than some of the technologies we were using as they could see our team mates out there hitting the high-touch areas.”

Ending on a positive note, Donohue revealed Terminal C — the one remaining terminal yet to be renovated — would be refurbished over the coming  years. He also indicated he was optimistic about travel and the recovery from the pandemic. “Travel and tourism accounts for 10% of global GDP. It is an incredible number of jobs and an incredible economic engine.

“I find there is a spirit to travel and that people like to make that connection. The recovery will take a while, but travel will come back. That spirit of travel, combined with the economic impact will carry the day.”

He concluded: “At DFW, we must continue working with our business partners and concessionaires to help them until the recovery takes full effect.”

 

 

 

 

 

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