Another investigation of airport food and beverage prices is under way. Officials claim to be shocked at some of the price tags they have seen. Of course the inspecting officials, including cabinet ministers, do not have to mingle with common vendors when they fly.
Still, the claimed sticker shock seems out of place. Most people know the most convenient food and drink outlets at airports will cost more than mid-city Bangkok street food.
This is the second "investigation" of airport food prices since the military regime came to power nearly four years ago. The first inspection was conducted in March 2016 with a follow-up on the situation a month later. Representatives of the Department of Internal Trade (DIT), charged with ensuring fair prices, were supposedly shocked at some of the prices they found during the follow-up inspection.
They were accompanied by Gen Viddhavat Rajatanun, head of the Office of the Ombudsman, who held up a big-name brand of soft drink for photographers. It had a price tag of 50 baht attached and in the front-page photos which appeared the next day, Gen Viddhavat looks appropriately disgusted. Of course nothing happened.
Just a month before that photo-op excursion of bigwigs, in April of 2016, a meeting was held at which executives of the Airports of Thailand, officers of the Consumer Protection Board (CPB) and officials of the DIT were present. The AoT representatives promised it would ensure that prices of food and drinks would be lowered as of April 10, 2016.
Of course they weren't. The AoT then reversed its story. It told the media that every rental contract of every vendor at every airport it administers says tenants have the absolute right to set their own prices. Phech Chancharoen, director of Don Mueang airport, said it was impossible to order vendors to lower their prices.
Neither the government nor the airport managers have the legal right to order prices for goods. That is generally a good thing. There is actual competition in the sale of food and beverages. Dozens of shops line the airport concourses. They include international and domestic chains, as well as independent operators. Every vendor wants to make a profit, but like any business anywhere, the retail costs, to the public, depend on many factors.
The most obvious and reportedly the major determinant of prices at the main food, beverage and variety outlets along major airport corridors is the rent of the store premises. Airport real estate is precious anywhere, but Airports of Thailand has turned shop rentals into a world-class business. AoT Plc just last month became the richest airport operator in the world.
There is more than shop leases involved, but AoT surpassed Spain's Aena SA as the most valuable airport services company. Its market capitalisation passed 1 trillion baht, surpassed only by state-controlled energy conglomerate PTT.
With that kind of money, much of it in raw, circulating cash, AoT could help bring prices down. Note, too, that AoT, while a public company, is actually 70% owned by the government. With those kinds of profits, coupled with that kind of leverage, it would be extremely simple for the government to order AoT to lower the rents by a certain percentage. In turn, AoT could order tenants to reduce retail prices by the same amount.
No one thinks this will happen. There are good arguments on both sides, but in the end AoT does a decent job of managing its six airports. Food and beverage prices are higher than many downtown locations. But there are options, such as the airport-managed food courts and free water refills.
Where passengers have no option, such as when they are waiting to board, the AoT or government must step in. They have the power to set limits or operate their own outlets in such cases.