The "May Day" that just passed was a 4-day long holiday，This rare arrangement inspired Chinese people’s enthusiasm for traveling。According to Qunar data，Within 1 hour after the official announcement of the 4-day long holiday，The search volume for air tickets has increased rapidly，Especially international 188bet online casino games，Instantly increased by 10 times。

In terms of air ticket prices，Price controls have been relaxed due to popular routes，188bet online casino games can set prices based on changing demand，Compared to last year，Fly to Beijing this year、Shanghai、Chengdu、Prices of some routes in Kunming and other places have increased by nearly 40%。Whole May Day，Even expensive first class bookings are up 30%。

Based on accurate data from Feichang，In these 4 days，The five most popular domestic routes are between the five cities of Beijing, Shanghai, Guangzhou, Shenzhen and Chengdu，These routes are basically used by China Southern 188bet online casino games、Monopolized by the three major 188bet online casino games, Air China and China Eastern 188bet online casino games。

Picture: Popular 188bet online casino games during this year’s May Day holiday

Similar long holiday travel growth has continued for more than ten years，It seems that these central enterprises have nothing to worry about。But last month，2018 annual report released by the three major 188bet online casino games，Net profit has basically been cut in half。Net profit in the first quarter of 2019 only increased by single digits year-on-year。

On the contrary, it is a low-cost airline that cannot get popular travel times at the largest airports，For example, Spring 188bet online casino games，Maintained 20% profit growth throughout 2018 and the first quarter of 2019。

Picture: 6 domestic 188bet online casino games in 2018、Revenue and profit growth in the first quarter of 2019

This is not unique to China。According to statistics from Asia Pacific Aviation Center，2009 to 2018，Global low-cost 188bet online casino games’ market share in domestic routes increased from 24.7% increased to 32.5%，International route market share from 5.6% increased to 12.7%。Asia，Southeast Asia is still the region with the highest market share of low-cost 188bet online casino games。

On the surface they are all 188bet online casino games，But，The operating conditions of the three major 188bet online casino games fluctuate greatly with the macroeconomics，Only at oil prices、Only when the exchange rate rises will there be strong profitability；And the passenger load factor of low-cost 188bet online casino games、Fares are much less volatile，Even when the economy is good, it does not have the flexibility advantage of large 188bet online casino games in passenger load factor，Conversely, when the economy is weak, the flexibility provided by oil prices is greater than the fluctuation of passenger load factor，Therefore, when the economy is weak, it is often a good time for low-cost 188bet online casino games to expand。

Although they are all transporting people，But 188bet online casino games a business logic perspective，The two are not the same business。

The difference between large 188bet online casino games and low-cost 188bet online casino games, first of all, is the difference in aircraft

There are two types of civil aviation companies，One is full-service type，Also known as Dahang；The other is 188bet online casino games type，That is, 188bet online casino games airline。

The world’s first low-cost airline was Southwest 188bet online casino games, founded in 1971，By using all smaller Boeing 737 aircraft，Tighter cost control，Be able to introduce cheaper air tickets to attract tourists，This triggered a revolution in the air transport industry。Ryanair in Europe、Low-cost 188bet online casino games such as AirAsia in the Asia-Pacific have emerged one after another。

At present, domestic low-cost 188bet online casino games mainly include two categories，One category is independently established，For example Spring 188bet online casino games、Juneyao 188bet online casino games；The other type is subordinate to several major 188bet online casino games，For example, China United 188bet online casino games、Western 188bet online casino games、Yunnan Xiangpeng、Jiuyuan 188bet online casino games, etc.。2018，Mainland China’s low-cost 188bet online casino games account for 9 market shares of domestic routes.7%，Compared to global low-cost 188bet online casino games’ domestic market share 32.5% level，There is still huge room for development。

For Economy Class passengers，Dahang、The obvious difference between low-cost 188bet online casino games may be the fare and service。

Take the currently on-sale flight ticket from Shanghai to Guangzhou on May 9, 2019 as an example，Spring 188bet online casino games fare is 830 yuan，The fares of the three major 188bet online casino games are between 1200-1500 yuan。

Except fare，in the country，Whether free meals are provided during meal times is still the direct feature that distinguishes low-cost 188bet online casino games from large 188bet online casino games。Although in the largest aviation market, the United States，Their three major 188bet online casino games have long become like low-cost 188bet online casino games，No free meals other than snacks will be provided to economy class passengers on domestic routes。

But for airline operations，It’s not a meal that has the greatest impact、A bottle of water，It is still the choice of airplane。

Currently，The mainstream civil aviation aircraft in 188bet online casino games can be roughly divided into three categories:

• Wide-body passenger aircraft，For example Boeing 787、Airbus A350，The cabin has two corridors，Carrying more than 250 passengers，Designed to fly routes of at least 3000 kilometers，But in recent years Air China、China Southern 188bet online casino games、China Eastern 188bet online casino games, the three major 188bet online casino games, are putting an increasing proportion of such large aircraft into domestic short- and medium-distance routes to popular cities。

• The second type is a narrow-body passenger aircraft，For example Boeing 737、Airbus A320，The cabin has only one corridor，Capacity between 100-200 passengers，Designed to fly short and medium-haul 188bet online casino games within 5000 kilometers。

• Finally, the increasingly rare double-decker jumbo 188bet online casino games，Boeing 747、Airbus A380，They have all been discontinued。

Air China and China Southern，All three types of aircraft are available。China Eastern 188bet online casino games also has the first two types，No 747 and A380 though，But there are two new long-range wide-body passenger aircraft, Boeing 787 and Airbus A350。

Low-cost 188bet online casino games basically use a single model。For example, Spring 188bet online casino games all uses Airbus A320。The aforementioned Southwest 188bet online casino games, the originator of low-cost 188bet online casino games, only has Boeing 737。

The planes are different because they serve different cities

As of the end of 2018，The total population of mainland China is 13.9.5 billion people，Beijing、Shanghai、Guangzhou、Shenzhen、The total population of the five major cities in Hangzhou is 83 million。Main routes of the three major 188bet online casino games、Market space，That’s 83 million people。

From a single route，Take Shanghai to Guangzhou on June 1, 2019 as an example，45 flights throughout the day，Among them Spring and Autumn、Juneyxiang 2 low-cost 188bet online casino games have 6 flights，The three major 188bet online casino games and Hainan 188bet online casino games flew 16 flights alone，There are 23 shared flights between China 188bet online casino games and local 188bet online casino games。Big city、Popular routes mean more passengers、Travel more frequently，Can fill larger aircraft。

In order to satisfy people in big cities who are willing to spend more money to make their journey comfortable，The three major 188bet online casino games provide super economy class on different routes、Business class、First class choice。And provide better and more spacious seats and better meal options。

Except domestic routes，The overseas destination of low-cost 188bet online casino games is also Japan、South Korea、Southeast Asia and other areas surrounding China，The distance is not too far，Not a transcontinental route，So Airbus A320、Boeing 737 is also competent。

And in Yangzhou around Shanghai，Shantou around Guangzhou，These two are cities with a population of about 5 million，There is only one Spring 188bet online casino games flight every day，2 hours flight，Tickets between NT0 and NT0，And there is no direct train between the two cities。For routes flying to low-tier cities with a relatively small number of passengers，Obviously more suitable for narrow-body passenger aircraft。

Differences in aircraft，Determines the large fluctuations in passenger load factors and fares of major 188bet online casino games，The passenger load factors and fares of low-cost 188bet online casino games are more stable

The aircraft used by low-cost 188bet online casino games are nothing special，Southwest’s Boeing 737 or Spring and Autumn’s Airbus A320 are also models purchased in large quantities by the three major domestic 188bet online casino games。

The difference is that there is only one type of 188bet online casino games, and it is only economy class.

One aircraft has many benefits，For example, all airports only need to consider maintaining one type of aircraft。And civil aviation pilots basically only fly one type of aircraft，Not to mention aircraft from Airbus and Boeing。The design problems of the Boeing 737 MAX also stem from Boeing’s requirement to allow old 737 pilots to fly the new aircraft without complicated training。Having only one type of aircraft means that low-cost 188bet online casino games do not need to consider how to schedule at a specific airport route when scheduling aircraft，As long as there are pilots，You can definitely fly。Dalian 188bet online casino games needs to consider whether the idle pilots in each city can fly the current aircraft models，These are related to the operational efficiency of civil aviation companies。

Economy class only、Free catering service means easy meal preparation，Low kitchen usage。For example, Chunqiu compresses the galley space at the rear of the 188bet online casino games，Increase 180 seats to 186 seats，Sell 6 more tickets for one flight。

Dalian 188bet online casino games、The reasons behind the large price fluctuations，It is greatly affected by the economic cycle。People who were originally willing to buy high-priced tickets may buy cheaper tickets due to economic fluctuations，But those who only buy the cheapest tickets will still go out，Just buy the cheapest ticket。

In addition, discounts are provided based on the time of booking flights，The earlier you book, the greater the discount。Review of China Southern 188bet online casino games、China Eastern 188bet online casino games、History of Air China，Only at oil prices、In a cycle where the RMB exchange rate is rising，Profitability is the strongest。

Take China Southern 188bet online casino games, which has the largest revenue among the three major 188bet online casino games, as an example，Between 2011 and 2018，The passenger load factor dropped from 83% to 79% and then increased again to 82%；Same period，Low-cost airline Spring 188bet online casino games，Expanded from 28 aircraft to 81 aircraft，The passenger load factor remains above 90%，relatively more stable。

In terms of "revenue per passenger kilometers", which is an indicator of an airline's revenue capability，China Southern 188bet online casino games also fluctuates greatly，at 0.53 yuan/passenger kilometer to 0.71 yuan/passenger kilometer；Spring 188bet online casino games is stable at 0.About 38 yuan/passenger kilometer。

Picture: Passenger load factor and passenger-km revenue of China Southern 188bet online casino games and Spring and Autumn 188bet online casino games

in the country，High attendance，Not only means more revenue 188bet online casino games passengers，also means 188bet online casino games airport、Local governments receive more subsidies。

Over the past ten years，Domestic cities invest a lot of money in building airports、Highway and other infrastructure，After it is built, it must be used as much as possible，So，In some second, third and fourth tier cities，Local Government、Local airports will provide certain route subsidies to 188bet online casino games、Taking off and landing fee reduction，Attract them to open local routes，Similar to the traffic subsidies used by Internet companies when promoting。

Also，According to the "Notice on Matters Concerning Preferential Charges for Passenger Service Fees at Civil Airports" implemented in 2008，If the number of seats installed on the 188bet online casino games is 10% higher than the average number of domestic airline seats and the flight passenger load factor is not less than 85%，The passenger service fee item of the flight landing fee can enjoy further discounts on the original basis。where，Flights with a passenger load factor between 90% and 95%，The passenger service fee can be further discounted by 25% according to the prescribed standards。

There is such a subsidy policy，Making subsidies a very high proportion of airline profits。

For example，2018，China Eastern 188bet online casino games net profit 27.100 million，Receive subsidy 54.300 million；Air China net profit 73.400 million，Receive subsidy 31.300 million；China Southern Net Profit 29.800 million，Receive subsidy 44.500 million；Spring 188bet online casino games net profit 1.5 billion，Receive subsidy 11.4.1 billion。

in nature，Local government subsidizes 188bet online casino games，Same as purchasing cameras from the traffic control department，Closer to “means of revenue generation” rather than “operating costs”，Main Line、Growth in regional airport throughput，means the arrival of a large number of passengers，It will promote local economic development。

Give an example，There are now 9 major civil aviation airports in Jiangsu，Nanjing Lukou International Airport、Wuxi Shuofang Airport、Changzhou Benniu Airport、Nantong Xingdong Airport、Xuzhou Guanyin Airport、Yangzhou Taizhou Airport、Yancheng Nanyang Airport、Lianyungang Baitabu Airport、Huaian Lianshui Airport，Very high density，Everyone needs to fight for the traffic brought by 188bet online casino games，As a local government and airport，Would rather default on other subsidies or debts，Also give the traffic subsidy money to the airline in advance。

Reflected in the airline’s financial report，That is, the accounts receivable of 188bet online casino games dragged by the government are generally very low。And other government-subsidized industries，For example, an environmental protection enterprise that implements the PPP model，It often changes due to government subsidies，Wide-scale capital turnover difficulties occurred。

at oil price、When the exchange rate is rising，It’s a good day for big voyages

It is easier to understand that it is affected by the exchange rate，Because of buying a plane、Plane rental、Buy jet fuel，Generally settled in US dollars，The trend of the exchange rate of RMB against the US dollar will naturally have a significant impact on the profits of 188bet online casino games。For example，2015、2016，The RMB continues to depreciate，The exchange losses of the three major 188bet online casino games in these two years were as high as 26.9 billion yuan。

The impact of oil prices is more complicated.

Aviation industry costs include aviation kerosene、Manual、Fixed assets (depreciation、188bet online casino games leasing、Repair)、Departure and landing fee、Sales and other expenses, etc.。where，The biggest cost is aviation fuel，Accounts for about 20%-40% of airline costs，But there is no simple positive correlation between changes in oil prices and airline profits。

This is because，Oil price fluctuations reflect more information。High oil prices usually mean higher economic prosperity，At this time, the demand for large 188bet online casino games with higher fares is also greater，Daily 188bet online casino games can also increase fares to transfer costs；In reverse，It seems that operating costs are reduced when oil prices are low，But it may also mean that the economy is weakening，The demand for large 188bet online casino games also weakened。

In the past ten years，Oil prices have experienced huge fluctuations，First the 2008 financial crisis，Oil prices fall rapidly，Then rebound，Remained at highs above /barrel until 2015。Later in 2015、Plumped to around /barrel in 2016。188bet online casino games 2017 to the first half of 2018，Oil prices climb back to /barrel，It then fell to less than /barrel at the end of 2018。

Picture: Crude oil price fluctuations

Source: Oriental Fortune Network

During this period，Although there will be Beijing Olympics in 2008、Oil prices plummeted，But there is also a crisis in the global economy，The three major 188bet online casino games suffered a total loss of 27.9 billion this year。And in 2009-2010 after the economic crisis，Although oil prices rebounded sharply，But as the economy stabilizes、2010 Shanghai World Expo held，Profits of the three major 188bet online casino games rebounded rapidly。

And in 2011-2013，Oil prices are relatively stable，But China’s economic growth is slowing down，GDP year-on-year growth rate increased from 10 in 2010.3%，Down to 7 in 2013.7%，Macroeconomics are not ideal，The profits of the three major 188bet online casino games have also declined significantly。

2016-2017，Oil prices gradually rise，And in 2017，The RMB ended three consecutive years of depreciation against the US dollar that began in 2014，Nearly appreciation 6%，Corresponding to the total net profit attributable to the parent company of the three major 188bet online casino games in 2017 is 19.5 billion，A record high。

Oil prices were low and then high in 2018, and the RMB depreciated nearly 5.2%，Even though the Civil Aviation Administration of China and the National Development and Reform Commission have relaxed fare controls on some routes，Allow domestic routes operated by 5 or more 188bet online casino games to implement "market-adjusted prices"，Gives 188bet online casino games more room to raise prices，Profits of the three major 188bet online casino games still shrunk significantly。

Picture: 2008-2018，Revenue of the three major 188bet online casino games、Net profit attributable to parent company

Anyway，Dahang’s fuel price、A period when exchange rates are rising，Is the period with the strongest profitability。In the past ten years，When economic prosperity drives aviation demand and oil prices，Cost increases can be passed on to passengers，So in 2009、2010 saw oil prices、Simultaneous rise in airline profits；Vice versa，In 2008 when oil prices fell sharply，Due to faster decline in demand after the financial crisis，The airline subsequently suffered huge losses；And 2014、2015，In the case of little change in airline supply and demand，Oversupply of crude oil causes oil prices to plummet，Airline costs reduced，But due to the depreciation of the RMB，The net profits of the three major 188bet online casino games are also very sluggish。

In comparison, low-cost 188bet online casino games are more like taxi companies

Different from that of large 188bet online casino games, profitability fluctuates with oil prices and exchange rates，Low-cost airline passenger load factor、Fare fluctuations are very small。

Take Spring 188bet online casino games as an example，From 2011 to 2018，Number of aircraft increased from 28 to 81，Number of seats increased from 5208 to 15066；Income from 44.600 million increased to 13.1 billion，Profit from 4.8.3 billion to 1.5 billion，It increases in proportion to the transportation capacity。

Picture: Spring 188bet online casino games operations

Also，Take the route from Shanghai to Guangzhou as an example，On Ctrip，Spring 188bet online casino games flight at 07:15 on May 8, 2019，Ticket price is 1150 yuan，Flight on June 1st at 07:15，Ticket is 820 yuan，Difference of 330 yuan；China Southern 188bet online casino games also uses A320 aircraft，Flight on May 8 at 06:55，Ticket price is 1360 yuan，Flight on June 1st at 06:55，Ticket price is 870 yuan，Difference of 490 yuan。Same aircraft、route，Similar departure time，Spring and Autumn are cheaper，Fare fluctuations are also smaller。

In the past 8 years，Spring 188bet online casino games’ production capacity increased by 2 times，The passenger load factor can be maintained above 90%，Less ticket price fluctuations，On the one hand, it shows that supply is far less than demand，On the other hand, it shows that the profit of Spring 188bet online casino games is basically equal to the profit of a single aircraft and the number of flights。

This situation，In fact, it is completely different from the three major 188bet online casino games with huge fluctuations，More like a taxi company。For taxi companies，Profit is equal to the profit of a bicycle and the number of vehicles。

Of course，Taxi Company，And current online ride-hailing companies such as Didi、China，Number of vehicles、When the number of drivers increases，The difficulty of management has increased exponentially，For example Didi，Safety accidents happen frequently。 Relatively speaking，It’s much easier for 188bet online casino games to manage their fleets。

They are also low-cost 188bet online casino games, but there are certain differences between Chunqiu and Jixiang.

Auspicious route，Most of them are popular routes departing 188bet online casino games Shanghai and traveling to and 188bet online casino games hot cities。At the two major airports in Shanghai, the airspace and runways are close to saturation、When there are few new routes，Jixiang’s growth comes 188bet online casino games the price increase of existing routes。

And Spring 188bet online casino games，2016 to present，In Shijiazhuang、Yangzhou、Ningbo、Jieyang establishes new development base，The goal is to operate and replicate routes to these second- and third-tier cities。in 2018，It has newly opened a round trip from Shijiazhuang to Guilin、Quanzhou、Wenzhou；Yangzhou to and from Nanning、Zhengzhou；Ningbo to and from Nanning、Qingdao、Zhengzhou、Harbin、Hohhot；Jieyang to and from Nanjing、Nanning、Qingdao、Route to Hangzhou。As of the end of 2018，Spring and Autumn has 113 domestic routes，where，33 routes to third-tier cities、33 flight routes between first-tier cities and third-tier cities、19 routes between second- and third-tier cities，In other words，Routes departing from third-tier cities account for about 75% of its domestic flights。

And these 188bet online casino games are very little affected by high-speed rail.

On the one hand，High-speed rail itself is mostly short- and medium-distance ones，Based on research by the Civil Aviation Administration of China，The impact of high-speed rail on civil aviation within 500 kilometers reaches 50%，The impact of 500 kilometers to 800 kilometers on civil aviation reaches 30%，800-1000 km，20%；There is almost no impact above 1500 kilometers。The average passenger journey of high-speed rail domestic 188bet online casino games is about 400 kilometers，The average civil aviation passenger travels more than 1,400 kilometers。

Figure: Average passenger journey of civil aviation domestic 188bet online casino games，Average journey of high-speed rail passengers

On the other hand，Many second- and third-tier cities do not have high-speed rail connections with each other，Or need to transfer，Long time，The fares have no advantage over low-cost 188bet online casino games。For example, from Qingdao, Shandong to Ningbo, Zhejiang，You need to transfer once to take the high-speed rail，The total journey is about 9 hours，Second class seat 600 yuan；On the contrary, it only takes 2 hours by Spring 188bet online casino games，Tickets range from NT0 to NT0。Another example is from Jieyang, Guangdong to Hangzhou, Zhejiang，Cheap flights are also 2 hours、Ticket price 470 yuan；You need to transfer when taking the high-speed rail，Total 17 hours，Second class seat 400 yuan，If you take an ordinary train，Took even more than 20 hours。

The airspace and runways in first-tier cities are now close to saturation，There are very few new 188bet online casino games to be added，Unless a new Daxing Airport is built like Beijing；And third- and fourth-tier cities are launching preferential policies for settlement to accelerate the “robbing of people”，Accordingly，The airport’s flight volume is growing rapidly。

Picture: Changes in the number of flights at some domestic airports in the winter and spring seasons of 2017/2018 and 2018/2019

As can be seen 188bet online casino games the picture above，Beijing、Shanghai、Guangzhou、Shenzhen、The flight volume in first-tier cities such as Hangzhou has basically stopped growing，Traditional popular tourist destination airport Haikou、Kunming、Sanya、Guilin’s flight volume has also stagnated。Ningbo instead、Yinchuan、Jieyang、Yichang、Flight volume in Yangzhou and other low-tier cities is increasing significantly，means the flow of people in these places、Logistics is gradually becoming more active。

Meanwhile，The growth of high-consumption outbound tourism has slowed down。2017，The growth rate of 188bet online casino games’s private outbound trips is only 5.7%，22% compared to 2010、10% of 2015，Huge drop。Also，According to calculations by Li Xunlei, Chief Economist of Zhongtai Securities，There are 1 billion people in the country who have not flown yet，And 80% of domestic airports，Contributes less than 10% of passenger throughput。

Population growth in lower-tier cities，Also reflected in consumption growth。Scale of rural e-commerce，188bet online casino games 200 billion in 2014，Growth to 1.2 trillion in 2017，It also gave rise to the rapid growth of Pinduoduo, which focuses on low-price products。

It can be seen 188bet online casino games this，Next few years，The incremental market of China’s domestic civil aviation industry，It is in a low-tier city。

In other words，The slump of major 188bet online casino games in the past year or so，With the continued growth of low-cost 188bet online casino games，Like the emergence of Pinduoduo，Reflects the changes in China itself。

*Source of this article: Curiosity Daily，Author of this article: Yao Shuheng，Original title: "Except fare，The business of low-cost 188bet online casino games and traditional large 188bet online casino games are not the same at all》.