Cathay Pacific has announced it is closing its subsidiary Cathay Dragon and cutting 8,500 jobs.
Cathay Dragon was a full service regional carrier flying mainly to mainland China and other Asian destinations.
Hong Kong-based Cathay Pacific says it hopes to retain most of Cathay Dragon’s routes.
Many other airlines are on the brink of survival as the Covid-19 pandemic batters travel and tourism.
The cutbacks at Cathay Pacific are part of the airline group’s attempt to reduce costs during travel restrictions that governments have imposed to limit the pandemic.
Cathay says it has already tried to cut costs by deferring aircraft deliveries, implementing special leave schemes and cutting executive pay.
It also received a US$5bn (£3.9bn) bailout from the Hong Kong government in June.
But the airline group is still losing as much as $260m a month.
Cathay Pacific and its budget carrier Hong Kong Express will take over Cathay Dragon’s routes.
“What we need to do is focus our efforts on a single premium full-service carrier brand, which will be Cathay Pacific, complemented by a single low-cost leisure brand in Hong Kong express,” said Cathay Pacific Chairman Patrick Healy.