Research On Business Model Innovation Of Regional Airlines And The Operational Effectiveness

In 2018,the Civil Aviation Administration of China(CAAC)introduced the "Action Plan for Building a Strong Civil Aviation Country in the New Era," with the goal of constructing a transportation powerhouse for China.However,the outbreak of the COVID-19 pandemic in 2019 severely impacted the global aviation industry,resulting in the suspension of international routes and reduction of major routes,leading to an unprecedented winter for the global civil aviation industry.During the recovery phase of the pandemic,regional aviation played a crucial role in guaranteeing production and transportation,and research has revealed that demand at the long-tail end became a key factor.This paper uses China’s Hainan Airlines as a case study to investigate the operating model of regional aviation.This paper first reviews the literature on commercial models,commercial model innovation,airline business models,and the point views of three types.It then defines market attributes and quasi-public attributes and reviews the long-tail theory,market failure theory,and government regulation theory.Through an analysis of the history and current development status of China’s civil aviation industry,and the policies related to regional aviation,and market demand(analyzing the current development status),it is found that the regional aviation market has enormous potential and development space.Moreover,this paper finds that the total transport volume of regional aviation market is rising,the market concentration ratio is high,and it is difficult to make profits.Subsequently,a systematic and scientific analysis was conducted on the current marketing situation of Huaxia Airlines.The main reasons for Huaxia Airlines to choose the regional aviation market are its low initial capital but abundant regional tourism resources,and poor infrastructure conditions.Then,this paper analyzes the potential problems that Huaxia Airlines faced when entering the regional aviation market,and discusses whether the traditional business model can adapt to the regional aviation market or not.It was found that regional airlines must innovate their business models to address related issues.Based on this,under the guidance of the business model canvas model,this article decomposes the existing business model of Huaxia Airlines and identifies its innovation compared to other regional airlines.Last but not the least,this article analyzes the operational effectiveness of Huaxia Airlines;The impact of Huaxia Airlines’ business model innovation on its financial and non-financial performance;And from the perspective of similar public attributes,analyze its operational effectiveness,and finally summarize the experience of Huaxia Airlines’ innovative business model.Furthermore,the paper analyzes the operational effects of Hainan Airlines’ commercial model innovation on its financial and non-financial performance,as well as its operational effects from the perspective of quasi-public attributes,and finally summarizes the experience of Hainan Airlines’ innovative commercial model.The research finds that Hainan Airlines has indeed found a highly feasible path for commercial model innovation in regional aviation,and its model is replicable.Although China’s regional aviation market is relatively weak overall and its development level is lower than the world average,regional aviation is an essential component of public air transportation,responsible for the coordinated development between the eastern and western markets,major cities and small and medium-sized cities,and small and medium-sized cities.This paper uses Hainan Airlines as a case study to analyze the commercial model of regional aviation,providing feasible suggestions and opinions for the development of China’s regional aviation companies.