Hawai'i airport shops must adapt to times
Gov. Ben Cayetano must decide soon whether to sign a bill to bail out airport concessionaires who continue to struggle with the economic fallout of the Sept. 11 terrorist attacks.
The stakes are high. Airport concession payments account for two-thirds of all airport revenues, paying for operating and capital improvement costs. DFS Galleria, which operates numerous airport concessions, has contributed an estimated $2.5 billion to state coffers over the past four decades.
But while we don't want to kill the golden goose, we don't want it limping around indefinitely either. This is business, not a welfare program. Any aid package must provide only temporary relief under strict conditions.
As we understand it, the measure before Cayetano would require the state Department of Transportation to waive or reduce guaranteed rent payments for 25 to 30 airport concessionaires.
If they cannot reach an agreement that ensures operating at break-even, concessionaires can cancel contracts without forfeiting performance bonds or their ability to bid for future contracts. Higher rates would be set for replacement vendors.
That's OK for now, but what about the future? Is the current status quo at the airport the best business model?
After all, the world of air travel has changed dramatically since Sept. 11 with heightened security and travel cutbacks. And things aren't necessarily going to bounce back. We need to look at new ways to maximize business for airport concessionaires and that's going to entail change.
For starters, the design of Honolulu Airport could use some modifications. Right now, only ticketed passengers who have passed through security are allowed in the shopping concourse.
That leaves certain businesses, such as lei sellers, obsolete because there's virtually no demand for lei from people leaving the Islands. Perhaps the security checkpoints could be moved closer to the gates so the ticketed and non-ticketed can both shop.
As for retail and services, the airport needs to be a place where travelers with time on their hands want to lounge, dine and spend money. It could use comfortable seating, diverse food vendors and perhaps a gourmet restaurant, more shopping variety and enhanced spa services.
Smart concessionaires customize to travelers' tastes: Consider some of the services other airports are offering:
• Las Vegas' McCarran International Airport offers 24-hour workouts.
• Denver, Minneapolis-St. Paul, Philadelphia, San Diego, San Jose, Calif., Seattle and Portland, Ore., airports offer DVD rentals for long layovers and to use on flights.
• Salt Lake City Airport has an 18-hole golf course just south of the terminal.
• Singapore's Changi Airport has an outdoor swimming pool on the roof of Terminal 1. They also offer aromatherapy and reflexology.
We understand that Hawai'i's airport concessionaires need immediate relief, but we can't go on subsidizing them indefinitely. Hawai'i needs to work on a new airport business model that's in step with the times.
