Qantas has become the latest airline to give a downbeat view of trading conditions despite being one of the few to post a profit – albeit small – for the first half of the year.
The Australian flag carrier said the global outlook “remains uncertain” as it announced a fall in profits of 88% to £62.4 million.
It follows numerous pieces of bad news for the aviation sector including a prediction by IATA that airlines are set to lose $11 billion this year.
Qantas chairman Leigh Clifford said: “Qantas is well positioned to withstand this period of downturn and will be ready to grasp opportunities fully during the eventual recovery.”
However, the airline has yet to see “any significant improvement in business conditions”.
The company has put in place a £750 million cost-cutting programme in order to improve profitability.
Qantas is also reported to be involved in a potential rescue of struggling Japanese flag carrier, Japan Airlines.
Qantas, British Airways and American Airlines are said to be in talks with the fellow Oneworld Alliance partner in a bid to stave off bankruptcy.
The three are also keen to prevent a rival bid from Delta Airlines, a member of Skyteam Alliance.
JAL announced job cuts of 6,800 employees last week, or 14% of its workforce.
The struggling airline has indicated it needs at least $2.5 billion just to help it stay afloat this year.