Severe competition in the global market impacts aviation business. Several airlines must adapt themselves to respond to new threat. Passengers and freight forwarders are expected to have lower service prices while being served with higher quality services. To compete with other airlines in the Asia-Pacific region, airlines in Thailand must manage their costs and service quality efficiently. Consequently, several factors that are critical to the airlines operations must be identified and analyzed. The objectives of this research are (i) to study the related factors which are significant to aircraft maintenance service, (ii) to study the Aviation Performance Benchmarking, (iii) to produce the Aviation Performance Development method, (iv) to produce the mathematical model for cost optimization, and (v) to implement the designed aviation supply chain model to four air operators and one aircraft maintenance center in Thailand. Finally, results from this research are used to formulate aviation policy and reported to the government in order to make the proper decision to enhance Thai aviation industry competitiveness.