One of the world’s biggest airlines, Emirates, has said it is suspending all passenger flights from Wednesday.
It is a pivotal move that reflects the dramatic slowdown in traffic through the airline’s hub in Dubai, the world’s busiest international airport, due to disruptions caused by the coronavirus.
The state-owned carrier stressed in a statement on Sunday it will continue to operate cargo flights through its fleet of Boeing 777 freighters for the transport of essential goods, including medical supplies across the world.
It also said the company will reduce salaries for the majority of its employees for three months but will not cut jobs.
Airlines around the world are struggling to cover their costs and pay salaries with their fleets grounded and countries shutting their borders to travelers.
In the Middle East, airlines have lost more than seven billion dollars (£6 billion) in revenue as of March 11, according to the International Air Transport Association.
The group said 16,000 passenger flights have been cancelled in the Middle East since the end of January.
Emirates Group chief executive and chairman Sheikh Ahmed bin Saeed Al Maktoum described the situation as “an unprecedented crisis” and said “the world has literally gone into quarantine” due to Covid-19, which has infected more than 300,000 people around the world.
The United Arab Emirates has all but closed its borders to travellers.
Mr Al Maktoum said the company was doing well financially at the start of the year but the virus “has brought all that to a sudden and painful halt over the past six weeks”.
“We find ourselves in a situation where we cannot viably operate passenger services until countries reopen their borders and travel confidence returns,” he said.
The company, which also operates an airport ground services company called dnata at locations around the world, had already urged employees to take paid and unpaid leave.
To save costs further, it said it is temporarily reducing the basic salaries of the majority of Emirates Group employees for three months, with cuts ranging from 25-50%.
The company said employees will continue to be paid other allowances during this time.
Junior-level employees will be exempt from the basic salary reduction.
The president of Emirates, Tim Clark, and the president of dnata, Gary Chapman, will take a full basic salary cut for three months.
“We want to avoid cutting jobs,” Mr Al Maktoum said.
“When demand picks up again, we also want to be able to quickly ramp up and resume services for our customers.”