Air Berlin to cut 1000 jobs, reduce fleet

Loss-making airline Air Berlin is set to reduce its fleet by half and cut 1000 jobs by the end of 2016, German newspaper Sueddeutsche Zeitung reports.

The airline, which struggles to post profits due to tough competition in the industry and the delayed opening of Berlin Brandenburg Airport, plans to reduce its fleet to about 70 aircraft and cut 1000 of its 8600 jobs, the report said.

The Munich-based newspaper cited industry sources as saying Air Berlin's biggest shareholder, Etihad Airways, was in talks with Lufthansa and travel company TUI over disposing of unwanted parts of the troubled airline.

According to Sueddeutsche, talks are ongoing about a possible combination of TUI's German airline TUIfly and Air Berlin's Austrian subsidiary Niki. That plan would allow Air Berlin to dispose of 17 aircraft.

Lufthansa is set to rent about 40 planes and crew from Air Berlin in what is referred to as a "wet lease," whereby the troubled airline would get fixed-rate payments while Lufthansa would assume the economic risk of operating the flights.

Air Berlin and Lufthansa declined to comment on the developments, Sueddeutsche said.