Research on route selection strategy of low-cost airlines

Abstract

Low-cost airlines with emerging business and network operating model, have undergone decades of development, and become an integral part of the global aviation market, the network construction process and evolution mechanism present a particularity, so researching the model of route entry has a certain theoretical value and practical significance. The paper chooses Spring Airlines to carry out case analysis. Although China lags behind other liberalized aviation markets in low cost carrier development, its largest low-cost carriers, Spring Airlines, has achieved rapid growth in traffic volume and revenue, as well as consistent profitability, since its inauguration in 2005. This paper establishes the probit model of airline route entry mode, and uses the airport passenger throughput, population, GDP, HHI index and other indicators to describe the considerations of selecting routes. Using the actual operating data of Spring Airlines obtain the factors of the Spring Airlines selected new routes, then I descript the impact of various factors deeply, and ultimately get the Spring Airlines' entry patterns.