Are They on the Right Business Model for Success?

Since 2005, four Korean LCCs are operating showing noticeable growth rate. The Korean LCC (low cost carrier) industry is expected to grow continuously through the competition between legacy and foreign LCCs. This research aimed to suggest more effective micro strategies for Korean LCCs based on the Ser-M and SWOT analysis. Hence the Korean LCC players have similar characteristic as less expensive carriers, we recommended macro strategies by gap analysis and ERRC model implying that they should adopt stricter LCC business model for the development and for the competitiveness. From the analysis we could induce suggestions; It is required to decrease their fare at least in the range of 70s % of legacy carrier’s one by eliminating free in-flight services as is the case of Southwest which has been an authentic business model for LCC; Direct sales by internet and smart-phone would help them to save cost like commission and labor cost; Various point-to-point route expansion strategy is quite relevant for LCC, and FFP (frequent flyer program) will be a mean for LCC to show more effective revenue management. Meanwhile, government policies are critical for the development of Korean LCCs; Regional liberalization in air transport, infrastructure and airport for LCC, convenient surface connection from airport, regional tourism development combining with airport, cultivating and supplying the human resource for aviation industry etc.