Beleaguered Scandinavian carrier SAS, which slumped into the red for 2008, said it would step up restructuring, lay off thousands, sell subsidiaries and cut 40 per cent of its routes.
The airline reported a net loss of 6.32 billion kronor (Dh2.78m) in 2008, after a profit of 636 million kronor in 2007 and a loss of 2.77 billion kronor in the fourth quarter. The news sent the share price crashing down almost 17 per cent to 35.80 kronor on the Stockholm Stock Exchange.
"Horrifying," said Chief Executive Mats Jansson of the company's losses at a press conference.
"2008 will probably go down in history as one of the most challenging and turbulent years that the entire aviation industry has ever experienced," he said earlier in a press release.
Already weakened in 2007 by technical problems which led to the grounding of its short-haul Dash-Q400 planes, SAS in 2008 faced plummeting demand due to the global economic downturn and a deadly crash in Madrid.
A plane operated by Spanair, an SAS unit, crashed in August in the Spanish capital, killing 154 people.
Out of SAS' 6.32-billion-kronor loss last year, 4.89 billion was attributable to Spanair, which the Scandinavian company finally sold to a consortium of Spanish investors last week for a single euro.
To overcome its dire financial difficulties, SAS said on Tuesday it would launch a new restructuring programme involving a share issue to raise six billion kronor and a fresh 14-plane reduction in its fleet.
An additional 3,000 employees would also be laid off, while a further 5,600 workers would be taken off its books through outsourcing.