The travel retail business is used to coping with its fair share of adversity. Past challenges this century have included the 9/11 terrorist attacks, the global 2007/8 economic crisis, volcanic ash clouds over Iceland in 2010, and, of course, the grandaddy of all travel industry headaches, the Covid pandemic of 2020. Sadly, what began in February as a potentially localised regional conflict in the Persian Gulf between Israel/the US and Iran has now joined this list of infamy by rapidly spiralling into a global economic crisis with no immediate end in sight, despite the shaky ceasefire in place at the time of writing.
Look away if you are of a nervous disposition, as the numbers are staggering. By mid-May, the aviation industry had moved beyond mere delays and disruption into full-on emergency management mode, with thousands of flights being cut. Around 2 million airline seats and 13,000 flights were scrubbed from airline global schedules last month alone. With jet fuel prices doubling to peak near US$200 per barrel due to the closure of the Strait of Hormuz, airlines are rationing precious supplies to concentrate on their most profitable routes. The Gulf Corridor, once the most important aviation transit hub, has only staged a partial recovery, with many fearful passengers still booking “long-way-around” routes to avoid the Middle East.
Within the travel retail sector, the crisis has temporarily reversed the fortunes of India and China. For the past few years, India has been the undisputed darling market for much of the duty free business, especially for premium drinks brands keen to capitalise on a burgeoning outbound middle-class customer base with a voracious appetite for premium Scotch. Today, however, this promising emerging market is navigating a full-blown crisis.
Catastrophic closures
India’s structural reliance on Gulf hub airports has left it uniquely exposed. With the UAE and Saudi Arabia accounting for nearly 30% of India’s international traffic, the ongoing airspace closures have proved catastrophic. In March 2026, for instance, India’s international traffic plummeted by 40%, according to the Directorate General of Civil Aviation, while last month the national flag carrier, Air India, announced it was axing 100 flights due to soaring fuel costs. The Federation of Indian Airlines has even warned that the country’s aviation business is on the “verge of closing down”.
In contrast, China, which has stockpiled huge quantities of fuel to withstand market shocks, remains relatively unscathed, for now at least. While India’s traffic fell sharply, China’s international traffic rose by 18.1% in March, according to IATA data. Benefiting from domestic oil, the use of Russian airspace, and recent visa-free initiatives to popular regional markets, hubs like Guangzhou (+24.9%) and Beijing (+19.8%) continue to expand.
For drinks brands, the message is clear: the relatively insulated Chinese traveller is suddenly looking like a much safer bet than the endangered flyer from the Indian subcontinent.
Meanwhile, in Europe, as the big summer getaway looms, the stakes could not be higher. This period is usually a golden quarter for the GTR drinks business, with carefree holidaymakers stocking up their drinks cabinets on returning from their annual two weeks on the sun-lounger. But Ryanair chief executive Michael O’Leary has already warned European airlines could go bankrupt this summer if jet fuel prices remain high. Other European airlines such as Lufthansa, KLM and Turkish Airlines have all announced cancelled routes and reduced frequencies. European governments are even granting slot flexibility, allowing airlines to cancel flights without losing airport rights – a massive red flag that high-volume cancellations are expected during the very months the travel retail business relies on for growth.
Yet in this volatile climate there is very little the business can do but watch the schedules shrink.
Despite all the macro-economic gloom and doom, the industry’s creative engine continues to hum. If anything, the worsening crisis has sharpened the focus on channel exclusivity as a way to tempt the travellers who do make it to the lounge to reach for their wallets.
For instance, Campari Group is making a significant play for shelf space in the burgeoning malt category with the new The Wanderlust Collection by The Glen Grant, which went on sale exclusively last month at Singapore Changi before a wider roll-out to other airports. The permanent, three-strong GTR-exclusive range is inspired by the global voyages of James ‘The Major’ Grant, the nephew of the distillery’s founder and an early custodian of the brand.
Meanwhile, the two titans of the blended Scotch world, Johnnie Walker and Chivas Regal, appear to be moving in diametrically opposite directions in terms of their positioning. Diageo has unveiled Johnnie Walker Blue Label Azure, a limited-edition, travel-exclusive developed by master blender Emma Walker. This launch has a distinctly ‘coastal’ vibe, perfect for summer occasions and warm-weather destinations. Sustainability is a key aspect of the launch, with the bottle made from 100% post-consumer recycled glass and coming with a reusable custom bottle bag designed in collaboration with Johanna Ortiz, a Colombian fashion designer.
Meanwhile, Chivas Regal appears to be following the more ‘petrolhead’ route trodden by other whisky brands of late by launching a Chivas Regal 16 Year Old limited edition in collaboration with Ferrari F1 driver Charles Leclerc. Everything about this release’s launch at US airports with Duty Free Americas, from the racing simulator activations at Miami International to the ‘reflex games’ for travelling shoppers, is skewed towards that affluent, speed-loving F1 audience.
It is a strange time for the channel. Industry stakeholders are nervously watching the summer of consolidation play out in real time, where the ability to actually get to the shelf is becoming as important as what is on the shelf.
Both the eco-conscious Johnnie Walker Blue Label Azure and the high-speed Chivas 16 Year Old will likely find their audiences, provided they can still afford the sizeable fuel surcharge on their tickets.
