Covid impact: 75% high-end brand outlets cease operations at Chandigarh airport

Footfall improved slightly, but airport facing losses of over Rs 7 crore per month, says CEO

The coronavirus crisis has cut a swathe through retail establishments at the Chandigarh international airport, forcing almost 75% of the shops to put up the shutters.

Despite domestic flight operations resuming at the airport on May 25, 22 of the total 30 high-end brands’ outlets had to shut down owing to huge losses. The airport now only has eight shops, which hardly see any visitors.

Retailers here say though their business has gained some momentum with about 15% improvement in footfall, passengers are still not willing to visit their shops amid the Covid-19 pandemic.

The airport, too, is incurring a loss of nearly Rs 7 crore per month on various accounts. Losses suffered by the airport authorities in the past five months have been pegged at about Rs 50 crore.

Before the lockdown, the airport saw at least 12,000 passengers, both at arrivals and departures, daily. The number has since come down to 1,000 a day. While 44 domestic and two international flights (Sharjah and Dubai) used to arrive and depart from the airport before March 23, only six to eight flights operate daily these days.

One of the shop owners said they have requested the authorities to charge the rent on the basis of revenue share. “But the management issued a letter stating that the rent will be fixed as per the passenger traffic. Food, beverages, retail, and services have borne the brunt of the pandemic at the airport and if this continues, we will be forced to shut all shops,” the shop owner, who wished to remain anonymous, added.

‘Will take some time to tide over this crisis’

Chandigarh airport’s chief executive officer (CEO) Ajay Bhardwaj said, “We have asked the shop owners to pay rent on the basis of passenger traffic. Though our footfall has improved by 15% with about 3,000 passengers per day, we are still suffering a monthly loss of around Rs 7 crore. We will take some months to tide over these crises.”

The airport’s main source of revenue is the aeronautical category, whereby the authorities charge Rs 800 per passenger from the airlines. For instance, a Delhi-bound flight with 80% occupancy pays about Rs 65,000 to the airport.

The other sources of revenue are retail shops, office spaces, vehicle parking, and advertisements.

Daily estimate of the total revenue generated by the airport was around Rs 30 lakh during pre-corona times.