Jobs risk as Virgin cuts flights

Virgin has so far defied much of the gloom in the airline industry

Virgin Atlantic, the airline majority-owned by Sir Richard Branson, says it will cut back on winter services and may cut up to 600 jobs.

Virgin said its daily Heathrow to Chicago service will not operate this winter and it would suspend one of two daily London to Hong Kong flights.

Total capacity would be 7% lower than in winter 2008/09, it added.

As a result, Virgin said it would start consulting with staff over the possibility of up to 600 redundancies.

The company, which employs about 8,500 people worldwide, had said in February that 600 jobs could be at risk.

Airlines have struggled during the economic crisis, although Virgin had been faring better than most.

In May, it reported a sharp rise in profits in the year to the end of February, bucking the trend seen by other airlines.

Annual pre-tax profits reached £68.4m ($109m), nearly double the £34.8m seen in the year earlier.

'Can't make money'

However, Virgin said that it was clear that economy was not picking up.

"Forward bookings are down on last year, and there is less demand," said Paul Charles, director of communications at the airline.

"People are still travelling but they are not paying enough for their seats, and you can't make money in this climate," he added.

Consultation over job losses will start in the next few weeks. Virgin hopes to avoid compulsory redundancies.

British Airways is also in talks with unions over measures to cut costs.

BA wants staff to accept a two-year pay freeze, according to documents seen by the BBC.

The company had already announced it was looking for 3,000 redundancies among crew and administrative staff.