A few days ago，China Eastern 188bet online casino games (hereinafter referred to as "China Eastern 188bet online casino games") issued an announcement on the official website of "Eastern Miles" stating that，Basic economy class will be launched on some routes from January 10 next year。But only online for one day，China Eastern 188bet online casino games canceled the announcement，And re-announced on December 13th。To this，The reporter called the relevant person in charge of China Eastern 188bet online casino games’ Publicity Department，The person in charge said，"Anyway，Subject to the new announcement。”

The launch of basic economy class by China Eastern 188bet online casino games has caused huge controversy，Many people think this is face-based discrimination。New announcement，In addition to basic services, this cabin，Cancel and change、Upgrade、Seat selection、Check-in、Privileges such as boarding order will be limited，Additional fee required。Some insiders told reporters，China Eastern 188bet online casino games is the first among the three major 188bet online casino games to try something new。The essence is that a full-service airline carries out branded freight，Start increasing auxiliary income。

Brand freight rates refer to price-based services，Segment services and charge accordingly，Passengers can choose the products they need。As understood，In the past, full-service 188bet online casino games served passengers regardless of their needs，Checked baggage is included in the ticket、Meals and a series of services，The basic economy class launched by China Eastern 188bet online casino games this time is a return to the essence of air passenger transportation-displacement service，Strip out additional services，Allow travelers to get more favorable prices，Get on the China Eastern 188bet online casino games plane。

The launch of basic economy 188bet online casino games caused controversy

December 10，China Eastern 188bet online casino games announced，Basic economy class will be launched on some routes from January 10 next year，According to the rules of this product，All members including China Eastern 188bet online casino games’ highest level platinum card members and SkyTeam Alliance super operating members，No points are allowed when purchasing this class、Upgrade through upgrade coupons and other methods，Cannot enjoy free checked baggage either。

But the announcement was withdrawn after only one day after it went online，New announcement will be online on December 13th。Latest announcement display，China Eastern 188bet online casino games、Shanghai 188bet online casino games plans to fly from Shanghai to Bangkok in mid-January 2019、Flexible economy class pilot launched on 2 Shanghai-Phuket routes、Standard Economy Class、Basic Economy Class Products。To form a new brand fare product system with the existing super economy class，It will be gradually extended to other routes in the future。

As understood，Basic economy 188bet online casino games in original seats、Meals、Based on entertainment facilities and cabin services，Provide more favorable fares，But cancel or change、Upgrade、Seat selection、Check-in、Privileges such as boarding order will be limited，And it cannot be combined with membership benefits，Additional fee required。

As soon as 188bet online casino games announcement comes out，It immediately caused huge controversy。Some people think 188bet online casino games is face-based discrimination。Civil aviation expert Wang Jiangmin thinks，Only from the perspective of "displacement", the characteristics of air transportation，Actually，Travelers with low fares in the past were the best value for money，Because they not only enjoyed transportation，Also enjoys most of the services，If safe、Airport facilities, etc.。In fact，In addition to the core service of "displacement", there are also extension services，Passengers can choose the service that suits them。

At the same time，He thinks，The customer base of basic economy 188bet online casino games is mainly leisure travelers，“They will buy their tickets earlier，It’s not easy to change travel date plans”。

Civil aviation expert Lin Zhijie thinks，Tourists are accustomed to the “one ticket and go” experience，I think the ticket should include all services，So this requires a certain process of cultivating consumption habits。The service launched by China Eastern 188bet online casino games this time is actually the "branded freight rate" that has been fully implemented in Europe and the United States，The core of this type of product is to allow passengers to change from "one service with different fares" to "price-based services"。With the launch of "branded freight"，188bet online casino games can use services to segment passengers。The purpose of the basic economy class launched by China Eastern 188bet online casino games is to attract low-frequency value-sensitive passengers。For example, no baggage check is required、No need to eat、The last group of passengers who can board the plane，You can buy cheaper "Basic Economy Class"；And have spending power，Passengers who need these services，You can purchase the mainstream "standard economy class"；Want to eat better、Stretch legs straighter、Ordinary business passengers who check in one extra baggage，You can buy the more expensive "Super Economy Class"。This is actually a model for personalized services to accurately meet the needs of passengers。

As the first airline among the three major 188bet online casino games to try something new, China Eastern 188bet online casino games faces substantial problems。In addition to cultivating consumer concepts，There are also policy restrictions。

As understood，Period from March 29 to December 23, 2015，China United 188bet online casino games collected a total of 443,210 yuan in seat selection fees from 26,853 passengers。This "seat selection fee" item，Violated relevant regulations，And it constitutes the illegal price behavior of "charging for independent charging items"。Beijing Municipal Development and Reform Commission requires China United 188bet online casino games to immediately correct its behavior of "charging seat selection fees"，And confiscate all illegal gains。

Lin Zhijie pointed out，A lot of work still needs to be done to comprehensively promote "Basic Economy 188bet online casino games"，Domestic customer regulations are restricted，such as free baggage allowance、Paid seat selection。So it cannot be done on domestic routes，Currently it can only be piloted on international routes。

In financial constraints, use branded freight rates to increase auxiliary income?

Some insiders believe，Carry out brand shipping price，Relying on ancillary revenue will become a blue ocean of future profits for 188bet online casino games。

"Global Airline Retailing: An Overview of Global Ancillary Revenue Best Practices" released by the international third-party consulting agency IdeaWorksCompany，Starting from 2010，Global 188bet online casino games upgrade seats、Ancillary revenue from services such as checked baggage continues to grow，From 2010 to 2017，The scale of aviation industry ancillary revenue increased from US.6 billion to US.2 billion，The proportion of total income also increased from 4.8% increased to 10.6%。

However，The development of ancillary revenue in China’s aviation industry still lags behind the global level，2013，China’s aviation industry ancillary revenue is valued at approximately US.1 billion，Accounting for 3% of the revenue of Chinese 188bet online casino games2%；USD 5.6 billion in 2018，6% of total revenue.8%。

Among the world’s 30 largest 188bet online casino games，20 188bet online casino games have implemented “branded fares” for economy class classification。Among them，7 companies in North America、8 European companies、1 Middle East、One company in Latin America has implemented it，The overall movement in the Asia-Pacific region is relatively slow，Currently only Qantas、Three 188bet online casino games, Cathay Pacific and Singapore 188bet online casino games, have implemented it。

Foreign 188bet online casino games have many tricks on supplementary fees。such as exclusive boarding gate，Reduce boarding time；Let passengers experience super economy class through VR，Promote upgrade ratio；Passengers book meals on the mobile APP；Personalization of back chair screen content, etc.。

Many domestic low-cost 188bet online casino games and small and medium-sized 188bet online casino games have begun to try supplementary revenue services，such as Tianjin 188bet online casino games、Lucky Air begins to implement meal charges on domestic routes、Seat fees and other auxiliary items。In comparison，Full-service 188bet online casino games are more cautious，Upgrade、Meals、Luggage check-in and other services are included in one ticket。

Actually，A look at the financial health of full-service 188bet online casino games，Not optimistic。Public information display，The financial logic of some listed companies in the HNA Group has been broken，A credit default has occurred，Air China、China Southern 188bet online casino games and China Eastern 188bet online casino games are also collectively facing a situation of highly tight liquidity。

Air China third quarter net profit 34.700 million yuan，Decreased by 29% year-on-year.9%；China Southern 188bet online casino games third quarter net profit 20.400 million yuan，A significant decrease of 52% year-on-year.3%；And China Eastern 188bet online casino games’ net profit is 22.100 million yuan，A significant decrease of 38% year-on-year.5%。At the same time，Air China、The current assets of China Southern 188bet online casino games and China Eastern 188bet online casino games are 259 respectively.300 million yuan、322.400 million yuan and 21 billion yuan，But their respective current liabilities are as high as 777.300 million yuan、859.800 million yuan and 769.800 million yuan。Among them，China Eastern 188bet online casino games has the lowest current ratio，Only 27.30%。

To reduce financial pressure，Reduce capital costs，Improve profitability，China Eastern 188bet online casino games, which has the tightest capital chain, has taken the lead in launching a refinancing plan，Plans to issue approximately 1.6 billion A shares and 500 million H shares to financial and strategic investors such as Juneyao Group and Juneyao 188bet online casino games，Seeking to raise RMB 11.8 billion and 35.HK0 million in funds，To supplement its current fragile liquidity。

However，Analysis from Financial Reporting Research Institute，Even if China Eastern 188bet online casino games completes the above-mentioned A+H refinancing plan of about 15 billion yuan，This can only temporarily solve China Eastern 188bet online casino games’ urgent needs，It is difficult to fundamentally solve the problem of financial pressure，Because China Eastern 188bet online casino games’ current net current liabilities are as high as 559.800 million yuan，Their current blood replenishment plan only covers about a quarter of this gap。

Analysis by industry insiders，Crude oil prices fluctuated greatly during the year，It once put pressure on the airline’s operations。Oil price is an important item on the cost side，has always been a key factor affecting airline performance，In order to reduce the risk of fluctuations in overall performance，In recent years, many 188bet online casino games have made efforts from the revenue side，And focus on other aspects besides ticket income。

Yu Zhanfu, head of transportation, logistics and tourism industry of Roland Berger Greater 188bet online casino games, once said，From the operating level of the airline company，Developing auxiliary revenue business will help improve profitability、Resisting earnings volatility，Because the gross profit of the auxiliary collection business is higher，And it has the characteristics of anti-oil periodicity。The gross profit margin of face business is about 10%~15%，The gross profit margin of the auxiliary revenue business can reach more than 20%。

Wang Jiangmin told reporters，At present, 188bet online casino games’ income mainly comes from fare income，However, the fare has not increased for many years，Full-service 188bet online casino games can no longer maintain profitability on fares，Facing the increasingly fierce aviation market，Full-service 188bet online casino games represented by China Eastern 188bet online casino games have also begun to split services，Start to make money from auxiliary income。

Lin Zhijie said，I believe that after China Eastern 188bet online casino games takes the first step，More domestic companies will actively follow up。

*Source of this article: 188bet online casino games Business Network，Author of this article: Liu Yuanyuan，Original title: "China Eastern 188bet online casino games’ launch of basic economy class has caused controversy. Relying on ancillary revenue may become a blue ocean for airline profits》.