What Should You Know About The Chinese Low-Cost Carrier?

Spring Airlines, China’s first Low-Cost Carrier
(LCC), has revolutionized the country’s aviation industry since its establishment in 2004. Known for its simple and efficient business model, it offers affordable air travel to millions of passengers in one of the world’s fastest-growing aviation markets. In this article, we will take our readers to explore the history, fleet, route network, service model, and challenges facing Spring Airlines
, providing a comprehensive look at how the airline has become a trailblazer in the Chinese aviation landscape.

The origins of Spring Airlines

The story of Spring Airlines begins long before its official launch in 2004. The roots of the airline can be traced back to 1981, when Wang Zhenghua founded Shanghai Spring International Travel Service, a travel agency designed to address the youth employment challenges facing China during the reform era. The agency, started in a modest two-square-meter “iron shack,” introduced innovative ideas such as “scatter-group tours,” disrupting the state-owned travel monopolies and offering more affordable and flexible travel options.

Photo: Spring Airlines

By the late 1990s, Wang, recognizing a gap in the aviation market, saw the potential for a low-cost carrier to cater to a growing demand for affordable air travel. Inspired by the success of Southwest Airlines
in the US, Wang envisioned an airline that could offer low fares by minimizing operational complexity and focusing on efficiency.

However, the path to realizing this vision was not straightforward. China’s aviation regulators were initially hesitant to allow private carriers to operate, let alone a low-cost one. Despite these regulatory hurdles, Wang persevered, lobbying the government for several years.

In 2004, after gaining approval from the authorities, Spring Airlines was born. The airline’s first flight, connecting Shanghai
and Yantai, took place on July 18, 2005, with only one aircraft. Initially, many were skeptical of Spring Airlines’ business model, but it quickly proved successful.

Photo: Spring Airlines

Spring Airlines continued to expand rapidly, achieving profitability by 2006. As China’s middle class grew, so did the demand for affordable air travel. The airline’s “low-cost, high-efficiency” philosophy struck a chord with Chinese passengers who were eager to take advantage of affordable flight options.

Fleet composition

One of the key pillars of Spring Airlines’ success is its fleet. The airline has built a modern, efficient, and standardized fleet centered around the Airbus A320 family of aircraft, which are known for their fuel efficiency, low maintenance costs, and reliability. This approach allows the airline to streamline its operations, reduce costs, and pass on savings to passengers.

Photo: Spring Airlines

As of 2024, Spring Airlines operates a fleet of 129 aircraft, with an average age of just 4.8 years. The airline’s fleet is predominantly made up of Airbus A320-family aircraft, which are the backbone of its operations. The fleet composition is as follows:

The airline’s decision to operate a uniform fleet brings several advantages. First, it simplifies crew training, as pilots and cabin crew can be cross-trained to operate all aircraft in the fleet. Second, spare parts and maintenance procedures are standardized, reducing costs and downtime. Finally, the airline can achieve high fleet utilization by maximizing the number of hours its aircraft are in the air, ensuring that each plane generates the maximum revenue possible.

In addition to its main fleet, Spring Airlines has expanded into the international market through Spring Airlines Japan, a subsidiary established in 2012. This subsidiary operates a fleet of Boeing 737-800s and Airbus A321s, and as of 2024, it has nine aircraft. These planes serve routes between China and Japan, including key destinations like Tokyo and Osaka.

Photo: Spring Airlines Japan

Spring Airlines’ strategic focus on operating a standardized fleet of highly efficient aircraft allows it to keep operating costs low and deliver competitive prices to passengers. As the airline continues to expand its international footprint, fleet modernization remains a key priority.

Expanding route network

Spring Airlines has grown its route network significantly since its inception, connecting major cities across China
and expanding into key international markets. The airline’s network strategy revolves around providing point-to-point flights, avoiding the higher operational costs associated with traditional hub-and-spoke models.

As of 2024, Spring Airlines operates 178 domestic routes, connecting cities like Shanghai, Chengdu, Guangzhou, and Xi’an, with a particular focus on underserved secondary cities. In addition to serving major metropolitan areas, Spring Airlines has opened new routes to smaller cities that were previously not well connected by air. The airline’s low-cost model allows it to offer affordable fares even to less-populous regions, contributing to increased air travel accessibility for a larger portion of the population.

Photo: Spring Airlines

Internationally, Spring Airlines has focused its efforts on expanding within Asia, with 41 international routes in operation. The airline serves destinations in Japan, South Korea, Thailand, Singapore, and other Southeast Asian countries. Some of the key international routes include:

• Tokyo: A major destination for Chinese travelers, with daily flights connecting Shanghai and Tokyo.
• Bangkok: A popular gateway to Southeast Asia, with multiple flights per week between China and Thailand.
• Seoul: A growing market, with several flights between China and South Korea each week.

Spring Airlines’ point-to-point model allows it to keep operational costs low while offering competitive fares. By focusing on high-demand short-haul flights, the airline has established a strong presence in key international markets and continues to look for new opportunities for expansion. The growing demand for affordable travel between China and Japan, in particular, has led Spring Airlines to announce plans for further expansion in this region.

Service model: Affordable and efficient

Spring Airlines’ service model is designed to keep operational costs low while delivering value to passengers. To minimize expenses, the airline adopts several strategies, such as a single-class configuration, unbundling services, and relying heavily on online sales channels.

• Single-class configuration: Spring Airlines operates an all-economy cabin, which allows it to maximize seating capacity and reduce operational costs. The airline’s efficient seat layout provides more affordable travel options for passengers while maintaining high load factors.
• Online ticket sales: Over 90% of tickets are sold directly through the airline’s website and mobile app, minimizing the costs associated with travel agents and third-party distributors. This direct-to-consumer sales model helps Spring Airlines keep fares low and increase profitability.
• Unbundled services: Like many other low-cost carriers, Spring Airlines unbundles many of its services, allowing passengers to pay only for what they need. Passengers can choose to purchase additional services like checked baggage, seat selection, and in-flight meals. This model helps keep base fares low while allowing passengers to tailor their travel experience.
• High aircraft utilization: Spring Airlines achieves high levels of efficiency by maximizing aircraft utilization. With an average of 10.3 flight hours per day per aircraft, the airline ensures that its planes are flying as much as possible, generating more revenue per plane and helping to offset costs.

Photo: Spring Airlines

In addition to these cost-saving measures, Spring Airlines has introduced innovative offerings to enhance the passenger experience. For example, it has launched a “business economy” class, which provides extra legroom and additional benefits at a more affordable price than traditional business class services. The airline also offers themed flights and promotional events, appealing to various customer segments.

Even during the pandemic, Spring Airlines occasionally offered 9-yuan ($1.30) tickets, highlighting its dedication to making air travel accessible.

Financial performance and resilience

Spring Airlines’ ability to maintain profitability and growth is a testament to its efficient cost management and effective business strategy. Despite challenges in the broader aviation market, the airline has remained financially resilient, continuing to deliver strong results year after year.

In 2024, Spring Airlines reported a revenue of RMB 987.51 billion, a 22.97% increase year-on-year. The airline’s net profits attributable to shareholders rose by 62.28% to RMB 136.1 billion. These strong financial results reflect Spring Airlines’ ability to maintain high load factors and keep operating costs under control. In the first three quarters of 2024, the airline transported 13.9 million passengers, with an average load factor of 91.31%. The airline’s strong performance has enabled it to weather industry challenges and maintain steady growth.

Photo: Spring Airlines

The financial success of Spring Airlines has allowed the airline to continue investing in fleet expansion, technology upgrades, and route network diversification. The airline remains one of the most profitable low-cost carriers in China and continues to expand its market share both domestically and internationally.

Related

How Have China’s Various Private Airlines Developed In Recent Years?

In China, where the state-owned economy dominates, the stories of private airlines are also very intriguing.

Looking ahead, Spring Airlines will continue to face challenges such as intense competition, rising fuel costs, and evolving customer expectations. However, its growth strategy, focused on expanding into untapped markets, modernizing its fleet, and embracing digital transformation, will position it well for continued success.

As the airline industry evolves, Spring Airlines will need to remain agile and innovative to maintain its leadership in the low-cost carrier segment, both domestically and internationally. With its commitment to low fares, high efficiency, and excellent customer service, Spring Airlines is well poised to continue its journey toward becoming a global player in the aviation industry.