Trade war may prove to be a boon for duty-free retailer
tional airports and other border crossings, where pur- chases avoid trade-related As the world frets over a fees as long as the goods looming trade war, one com- immediately leave the coun- pany sees an opportunity. try. Discounts to street prices
Dufry, the world’s largcan be as much as 40 per- est duty-free retailer, would cent on some items. thrive in a more restrictive The U.S. is scheduled to trade environment, Chief impose tariffs on $34 billion Executive Officer Julian of Chinese exports on Friday. Diaz said in an interview. China has said it will place That’s because tax-free air- levies on an equal value of port shops could gain a big- U.S. goods, which would ger price advantage over in turn lead to additional other retailers if governpenalties from the U.S. The ments impose new levies European Union Commison imports. sion has said it would retal
“We’re not subject to taxes, iate against U.S. tariffs on we’re not subject to duties — European steel and alumiif there are taxes and duties num with tariffs on Ameriat the border, for us it’s bet- can products such as denim ter,” Diaz said, adding that jeans and bourbon whiskey. he nevertheless hopes openDufry is watching Brexit ness prevails. “I’m a citizen proceedings with similar of the world, and free trade interest. With Britain’s deparis probably the best thing.” ture from the EU less than
The Basel, Switzer- nine months away, the two land-based company sells sides have yet to decide on an array of products — from their future trade relation- cigarettes and cosmetics to ship or the duration of a tran- $45,000 bottles of Macalsition period. Large manulan 1937 Scotch whisky — facturers such as Airbus and through shops in interna- BMW have warned they’ll have to pull investment from Britain if barriers are put up to trade with the EU.
“It’ll be very important for us” because Dufry would benefit from travelers entering and leaving the U.K., Diaz said. “Many countries will be impacted.”
Luxury group Richemont bought a 5 percent stake in Dufry last year and later raised it to 7.5 percent. As the Swiss company has raised its investment, China’s HNA Group Co., which bought a 21 percent stake in Dufry last year, has lowered its economic interest to less than 1 percent.
The Asia, Middle East and Australia region makes up a mere 10 percent of Dufry’s total sales, though Asia is the fastest-growing market. While Diaz said Dufry always considers acquisitions, it’s still consolidating the activities of the past four years. In 2015, Dufry acquired Italian rival World Duty Free for $3 billion, a year after purchasing Nuance Group for some $1.7 billion.