Spanish airline Iberia said yesterday it planned to axe around 3,000 jobs as part of drastic cost-cutting measures following the US attacks.

The job cuts will be presented to the Spanish government and labour unions within a month as part of a broader plan to reduce Iberia's activities by 11 per cent from November 1st, the airline said.

In Belgium, Virgin Express, the Brussels-listed carrier that is 59 per cent owned by Sir Richard Branson's Virgin Travel, said it was interested in buying "certain assets" in Sabena, Belgium's stricken state airline.

If Virgin did put fresh capital into Sabena, it could open the door to a new cash injection by Belgium. A Belgian court has given Sabena protection from creditors until November 30th, but it has to win a creditors' vote on a rescue package on November 15th.

In a stock exchange statement released after Virgin Express executives met court officials, the company said it had "formally indicated interest in assisting with the resolution of the deepening problems surrounding Sabena by registering interest in acquiring certain assets of the company and its operations". The statement said that discussions were at an early stage.

Meanwhile, in Switzerland, unions at bankrupt carrier Swissair warned yesterday that the rescue plan for the airline based around the regional carrier Crossair was in danger of collapse, threatening a further 17,000 jobs at the airline.

The three unions representing Swissair's ground workers said the original plans, which envisaged Crossair taking over 52 Swissair aircraft and around 5,000 employees, were likely to get scaled back.

They said management was now considering taking up to a maximum of 10 aircraft. The knock-on effect of such a reduction would lead to further job losses.