UTair (UT, Khanty-Mansiysk) managing director Andrei Martirosov says the airline will make cuts to both its route network and workforce this coming winter season. As part of its two-year long "Impulse" cost-cutting programme aimed at saving the carrier RUB5billion (USD141.1million) in overheads, Martirosov told Russia's Kommersant newspaper that UTair will axe roughly 10% of its labour pool, or roughly 800 employees, of which 300 will be from its technical department. In addition, the airline will also reduce its frequencies by 20%, he said.

During this year's winter season, UTair and its UTair-Express (Syktyvkar) subsidiary will operate flights to 117 destinations in 12 countries, down from 190 destinations during the same period last year.

In addition, UTair will also postpone its fleet expansion plans with the arrival of twelve new A321-200s from Airbus (AIB, Toulouse Blagnac) to be delayed until 2016 to 2018 while its incoming fleet of twenty-seven B737-800 WIN.s and seven B737-900 WIN.s from Boeing (BOE, Washington National) will be deferred indefinitely.

The carrier has been severely affected by the slow-down in the Russian economy, brought on by the imposition of hard-hitting US and European sanctions over Russia's unilateral annexation of Crimea from Ukraine in March as well as its alleged involvement in the downing of Malaysia Airlines flight MH17 in July this year.

Earlier this month, UTair took the now-insolvent “Southern Cross” to court over RUB306million (USD7.46million) in unpaid remittances for charter flights to China and Greece. The Russian tour operator is the latest to buckle after Labirint, Nordic Star, Solvex Tourne, Yuzhny Krest and More Solntsa, all of which have cited a sharp drop in demand for their respective bankruptcies.

Moscow is currently studying various options to help bail out the struggling carrier. Among the possible choices are the cession of managerial control to Aeroflot (SU, Moscow Sheremetyevo) as well as the extension of state-backed loans to help shore up the airline's finances. Rivals S7 Airlines (S7, Novosibirsk) have expressed reservations about the latter option claiming that any state financial intervention would inevitably lead to a distortion of the market.