| With the difficult recovery of world economy and slow growth of domestic economy, civil aviation industry in China still maintained a high growth rate. By the end of 2013, passenger transport volume of civil aviation industry reached 353.97 million, increased by 10.8% compared with last year. With the continuous growth of economy and residents income levels, more and more travelers choose the aircraft as a way to travel. Nonetheless,annual per capita flight in China is nearly 0.26 times, but the number in US and Europe is 2 to 3 times. That shows the development potential of civil aviation industry in China is large. Meanwhile, it means that the vast majority of people can’t form an effective demand, mainly because air travel in our country is still luxury consumption. Although the airline has introduced discount tickets, the high price still can’t meet the need of ordinary people and guest rate is still not ideal. The fundamental reason is that the current operation mode of airline made high operation cost and limited the space of price decline. Therefore, from whether the view of its own development or the perspective to meet the market demand, low-cost airline business model is imperative in our country.This article firstly consolidated related low-cost airline theory, and then summarized the domestic and international low-cost airline business model. Then as an example of China Eastern Airlines X Branch, we use PEST model, porter five model and SWOT analysis tools to analyze the micro environment of China Eastern Airlines X Branch. Through analyze the cost structure of China Eastern Airlines X Branch, we revealed the questions in the course of business. The questions are as follows: low aircraft utilization, high labor costs and high aircraft acquisition and lease costs resulted in high operational costs. Finally, the article points out the measures taken by China Eastern Airlines X Branch in operational process. The measures include establishing correct market positioning, implementation of efficient marketing strategies, developing a reasonable human resources plan, building low-cost operating framework, creating a good corporate culture.The article explores whether the large stated-owned airlines can make low-cost operation and points out the practical plan. It makes a reference in response to low-cost airlines. |