Virgin Atlantic cutting daily service from London to O'Hare

Virgin Atlantic Airways Ltd., the U.K. carrier owned by billionaire Richard Branson, will reduce seating capacity by 7 percent this winter and said it's ready to begin talks about eliminating as many as 600 jobs.

Virgin Atlantic will stop flying daily from London Heathrow to Chicago and suspend one of two daily Heathrow-Hong Kong services, the Crawley, England-based airline said today in an e-mailed statement. It will also cut frequencies elsewhere.

"The outlook for the industry is as bleak as ever and all airlines are having to shrink their businesses," Chief Executive Officer Steve Ridgway said in the statement. "The fittest will survive and be in a stronger position when the economy grows."

Carriers are eliminating routes, reducing their workforces and delaying aircraft purchases as they brace for a $9 billion full-year loss predicted by the International Air Transport Association. Virgin said today it will try to prevent firings as it starts negotiations on job cuts it announced Feb 12.

"We will look to minimize the number of compulsory redundancies and ensure we treat our staff as fairly as possible," Ridgway said. Virgin Atlantic had 9,143 workers as of Feb. 29, according to Bloomberg data.

Rival British Airways Plc, which employs 40,000 people, plans to scrap the jobs of at least 2,000 flight attendants and 1,500 ground workers after reporting a $617 million loss for the year ended March 31. BA said today it's seeking arbitration after talks with unions about the cuts broke down.

The London-based airline has already eliminated 78 pilot posts and says 4,000 workers have agreed to take unpaid leave. About 1,400 will work part-time and 800 full-time employees will work for free for one to four weeks.