Airline giant Qantas plans to slash 1,000 jobs in 2014 after reporting losses of up to A$300m.
The Australian firm blamed a "fiercely difficult" operating environment since the financial crisis, citing a strong competition and "record jet fuel costs".
The employers expects to report an underlying loss before tax in the range of A$250m ($271m, £165m, €197m) to A$300m for the six months ending 31 December 2013.
The company said it will implement an accelerated cost reduction program across of its business units, in the hope making A$2bn worth of savings over three years.
The move will mean at least 1,000 jobs will be cut within the next year and the firm will review its executive pay as well as further overhead reductions.
"We will do whatever we need to do to secure the Qantas Group's future," said Alan Joyce, chief executive officer of Qantas.
He added: "The challenges we now face are immense - but we will overcome them and we will continue to build a stronger and better Qantas for Australia."
Joyce also revealed the airline was in discussion with the Australian government over the cuts, but said none of the measures being talked about would stop the company from taking the cuts.
The chief executive stressed customers would "remain at the heart" of the firm's strategy.
Credit Rating Reduction
Agency Standard & Poor's has reduced the company's credit rating of BBB- (outlook stable) to BB+ (outlook negative) on the news.
The move means the airline's investment grade is now considered "junk" and could mean the firm's lending costs are increased.
"Intense competition in the airline industry has weakened Qantas' business risk profile to fair from satisfactory, and financial risk profile to significant from intermediate," said Standard & Poor's.
Gareth Evans, chief financial officer at Qantas, said a downgrade was not unexpected following the news of the company's cost cutting plan.
He added: "[The reduction] highlights the unprecedented pressures that Qantas is facing from several external forces but particularly from an uneven playing field in the Australian aviation market."