Tender time in Taipei: Taiwan Taoyuan International Airport announces T2 bid

Taiwan Taoyuan International Airport today announced the long-awaited Terminal 2 duty free tender. Full documents will be available from 1 June with bids due by 23 July.

The two contracts on offer will run for 12 years with three-year extensions subject to “outstanding” performance.

The incumbents for the T2 zones C and D concessions are Tasa Meng Corporation (North Gate D) and Everrich Duty Free (South Gate C).

Besides the long-established duo, likely bidders include Dufry, DFS Group, Lotte Duty Free, The Shilla Duty Free and Shinsegae Duty Free. The Moodie Davitt Report understands that Dufry, DFS, Lotte and Shilla are all poised to work with strong local partners on their respective bids (Dufry with Taiwanese airline Eva Air; Lotte with the TV shopping arm of banking group Fu Bon; Shilla with local food chain Hsin Tung Yang; more details on other partners to follow soon). Shinsegae will bid alone.

The T2 south side business covers 25,400sq m of space, embracing the departures corridor and the C zone concourse. The T2 north side includes the departures corridor, and D zone concourse, involving around 31,900sq m.

The tender model is unique to Taiwan. Its public/private partnership (PPP) structure means that the winning retailers are also responsible for funding and managing other airport activities, including washrooms, information counters, boarding gate rooms, smoking lounges and others.

The successful bidders have the right to set up a downtown shop with airport pick-up (as Ever Rich already does).

The traffic figures here are published by exclusive agreement with m1ndset’s newly launched Business 1ntelligence Service (B1S). This unique air traffic forecasting tool was developed with IATA and ARC’s ‘Direct Data Service’ (DDS) database. Click to enlarge charts.

Comment: This is set to be a battle royal in one of Asia’s travel retail hotbeds, especially with such long-term contracts at stake.

Strong (and in this case highly successful) local incumbents are notoriously hard to shift in such contests and both Everrich and Tasa Meng have particularly sound reputations, top-class social credentials and excellent partnership history with the airport.

But international powerhouses DFS (which operated in Taipei, downtown and airport, and Kaoshiung International Airport for several years) and Dufry present solid competition, especially with formidable local partners believed to be in place. The same goes for the Korean trio of Lotte, Shilla and Shinsegae, all determined to expand outside their domestic strongholds. We’ll bring you full analysis of the likely bidders and their prospects soon.

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