Thailand’s Central Group and DFS Venture Singapore snapped up retail and services concession at an upcoming airport in the eastern province of Rayong, a government official said on Monday, beating out duty-free giant King Power.
The announcement underlines the challenges King Power is facing as its dominance of the lucrative Thai duty-free and travel retail industry comes under scrutiny, at a time when it is also trying to recover from the recent death of its chairman, Vichai Srivaddhanaprabha, in a helicopter crash.
“Central Group won the retail and services auction while King Power won the bid for duty-free,” Vice Admiral Luechai Sri-eamgool, director of U-Tapao International Airport, said.
U-Tapao is the first airport in Thailand to hold an auction with multiple concessions, splitting up duty free and retail operations. Up until now, King Power has enjoyed near monopoly, being a sole operator with concessions in all major airports.
King Power’s most lucrative franchise in Thailand’s main international airport is under a single license that is set to expire in 2020. Auctions for concessions at Suvarnabhumi are slated to take place later this year.
Airports of Thailand Pcl, a state-owned firm that grants the concessions at major airports including Suvarnabhumi, may consider multiple concessions at the auction, analysts say, increasing competition among retailers.
Tourism is booming in Thailand, which received nearly 35 million visitors last year, most funnelled through the airports where King Power is ubiquitous. But public debate has increased over the single duty-free operator structure.
Article Source: https://www.reuters.com/article/thailand-kingpower