Lagardère Travel Retail snaps up eight-year duty-free contract at Auckland Airport

NEW ZEALAND. Auckland Airport today (18 March local time) announced Lagardère Travel Retail as its future duty-free partner on an eight-year contract following a worldwide Request for Proposal (RFP) process.

The LagardèreAWPL joint venture, trading as Aelia Duty Free, is the incumbent. However, Lagardère Travel Retail bid alone for the four-store departures and arrivals shopping concession.

The contract, which is subject to Overseas Investment Office approval, is expected to begin on 1 July.

The Moodie Davitt Report understands LagardèreAWPL beat off strong competition from an initial four-company shortlist (later slimmed down), including Avolta and two Indian aviation powerhouses GMR Airports and Adani Airports.

Auckland Airport Chief Commercial Officer Mark Thomson said Lagardère Travel Retail is set to transform the duty-free experience over coming years. The French company will bring an extensive suite of top global brands and undertaking a full refurbishment of all duty-free stores, including a major transformation of departures, he pledged.

“Over nine million international travellers flow through Auckland Airport every year and we know they’re looking for great prices, world-class brands, and quality retail experiences as part of their journey.

“While we were impressed with the quality of all the proposals we received, Lagardère stood out with the most compelling offer that aligns with Auckland Airport’s commitment to offer travellers an exceptional customer experience, and celebrate the best of Aotearoa New Zealand and the world.

“In selecting Lagardère, we are confident we have a partner that is a world-leader in duty-free shopping, which understands the New Zealand and trans-Tasman duty-free proposition. They have over ten years’ experience at AKL, most recently as part of the joint venture company LagardèreAWPL, trading as Aelia Duty Free.

“They also have global retail pedigree, operating in some of the largest airports in the Asia Pacific region and in other locations around the world. As part of our new partnership, the duty-free offer will transition from LAWPL’s Aelia and become a bespoke proposition for Auckland, operated by the separate entity Lagardère Travel Retail.”

Thomson said Lagardère and AKL are committed to delivering competitive prices to consumers and a wide range of product offerings to cater to all traveller segments.

“Ensuring a competitive proposition that delivers both customer value and growth was a key consideration in our evaluation process”, he said.

Auckland Airport retailers are obliged to ensure their pricing is fair and competitive. Auckland Airport uses a third party to actively monitor prices against those of similar off-airport retailers or outlets at other airports, where appropriate.

We will bring you reaction from Lagardère Travel Retail and analysis of this important contract success soon (main story continues following the sidebar below).

Two becomes one

In 2023, Auckland Airport transitioned from a dual model (ARI and LagardèreAWPL) to a single-duty-free retailer, following the global shift to online shopping and an evolution of aviation industry norms where airports have moved away from duplicated duty-free offers.

Prior to the transition, a benchmark study in 2023 found only two of 112 other international airports of a similar size to Auckland Airport currently operate dual full-duplication models.

“We’ve had a new single operator model in place for almost two years and we’re thrilled with how it’s performed so far, despite economic challenges and the limited investment made in these stores over the period,” Thomson said.

“The double-up of products we saw in a dual model has now been removed, and this has enabled a 40 per cent increase in the number of brands on offer to customers over this period. Local New Zealand products also grew by 30 per cent, providing customers with a much-improved product offering,” he said.