Research On The Development Problems And Countermeasures Of China's Low-cost Aviation Market

The low-cost carriers have changed the pattern of world aviation industry.The first low-cost carrier,Southwest Airlines,was established in the United States in the 1970 s,It innovatively put forward differentiated services,such as removing the first-class and business class cabin,cutting out free meals,and operating point-to-point routes rather than in hub-branch service model,etc.Southwest Airlines has soon had a firm footing in the United States,and continued to create profit miracles one after another.Later on,with the relaxation of aviation control in Europe in the 1980 s,the low-cost model began to take root and sprout in Europe and continued to grow,from which such low-cost carriers as Ryanair and Easy Jet arose.The emergence of low-cost carriers in Asia was relatively not long ago,which was also related to the universally strict aviation control across Asian countries.Nevertheless,since the beginning of the new century,local lowcost carriers have been established continuously,like Asian Airlines and Spring Airlines have developed successfully and rapidly.Three decades of development has enabled low-cost aviation to gradually become an important integral part of the global aviation industry.What makes low-cost carriers different from traditional full-service airlines is that low-cost carriers can improve their core competitiveness by reducing costs and removing redundant services,so that the ticket price can be significantly cut down,with the aim of winning more passengers and market share.At present,low-cost carriers are growing in China,and they enjoy a broad development room in China.Since the establishment of Spring Airlines in 2005,in recent years,with the continuous growth of China's civil aviation market,passenger traffic has been rising.And then,low-cost carriers have gradually attracted attention in China's market and government departments,and have been lionized in China's aviation market.Major aviation groups have established their own subsidiaries of lowcost carriers to seize the market share of low-cost aviation.At the same time,many newly established airlines choose a low-cost mode or transform into low-cost service companies,which also highlights the gradual advancement of the significance of lowcost carriers in China's aviation industry.In February 2014,the Civil Aviation Administration of China(CAAC)promulgated the Guiding Opinions of the Civil Aviation Administration on Promoting the Development of Low-cost Aviation,which began to create a favorable environment for the development of low-cost carriers and increase support from various aspects.Under the dual effect of market and policy,the number of low-cost carriers in China has grown significantly,from one to nearly ten.However,low-cost carriers in China are also confronting many problems,owing to the change of time in the demand of the aviation market,the fluctuation of international oil prices,the impact of domestic and international economic environment,the increasing substitution capacity of high-speed railways,and its high investment,low payback,and high risk in nature.Among those nearly a dozen low-cost airlines,currently only Spring Airlines has realized sustainable profiting and fast development.This paper mainly attempts to explore a faster and better way to develop the low-cost aviation,one of the subdivisions of aviation,in China.Firstly,this paper introduces the development history and mode of low-cost carriers,and analyzes the development issues in several relatively representative low-cost carriers in China from the aspects of politics,economy,society,and technology,by incorporating the problems existing in domestic air transport environment.The unique status quo of China's low-cost aviation development and operation are constructed,the problems that may be encountered in the development are clarified.By the means of studying the existing policy environment,economic basis and social background,as well as substitutes,suppliers,and existing competitors in the industry,this paper conducts an in-depth analysis of the root causes of the existing issues in China's lowcost market,and finds out the market orientation and development direction of lowcost aviation.At the same time,this paper analyzes the competitiveness of several domestic mainstream low-cost airlines through SWOT analysis.By analyzing the foreign low-cost carriers' successful experience and lessons in their development,contrasting domestic with foreign differences,it is expected to propose some suggestions and countermeasures for the development of low-cost carriers enterprises in China and carry the development of low-cost carriers forward.Through the analysis of this paper,the following conclusions are drawn.The development of low-cost aviation in China is still in its initial stage,and the main problems encountered are inadequate policy support,cost control difficulties,communal understandings,as well as alternative competition.Through analysis,it is suggested that governments at all levels in China should effectively support the development of the low-cost aviation industry,formulate corresponding plans and guidelines,and provide certain policy preferences and support.It is also proposed to create favorable conditions to reduce the fixed costs of low-cost airlines,guide the social consumption concept,promote the low-carbon environmental travel,and cooperate with high-speed rail departments to make positive attempts and changes.Only in this way can the low-cost aviation gain vitality in the highly competitive aviation market at home and abroad,constantly proceed its development in China,and facilitate the most fundamental travel needs of the public.