Research On China's Low Cost Airline Policy Based On Diamond Model

In February, 2014,The civil aviation administration of China issued “Guidance to promote the development of low-cost airlines” to build a free and easy environment for the development of low-cost airlines.There are several low-cost carriers in China,the more famous companies are Spring Airlines?China United Airlines?West Air,etc.However, the market share of low cost airlines in our country is only seven percent which is far below the international average level.To realize the goal of popularization of China's civil aviation,we must promote the development of low-cost airlines.In this paper, we analyze the factors affecting the competitiveness thoroughly with the help of the analysis framework provided by Michael Porter diamond Model.On this basis,we put forward policy recommendations.The essay consists of six parts.The first section mainly describes the background and significance of the development of low-cost airlines?the present situation of the research at home and abroad?the research method of the author.The second part is theoretical research.In this part,we introduce Michael Porter diamond Model at great length?the related theory of low-cost airlines.The third part of this article mainly analysis the present development status of low-cost airlines in some other countries.On this basis,we put forward some useful suggestions for the development of low-cost airlines in our country.In the fourth part,we mainly describe the policy for the development of low-cost airlines and the present development status in China.Based on the analysis,we point out the problem in the development of low-cost airlines in China.The fifth part of this article analysis the factors of the low-cost airlines' competitiveness specifically from five aspects:production factors,demand conditions,relevant industry,strategy structure and government behavior based on Michael Porter diamond Model.The last section explains the limiting factor of the development of low-cost airlines.In this part,we put forward policy suggestions to promote the development of low-cost airlines in China.