China Airlines on the other hand had notched up profits in the first half, but the company will not likely meet profit forecasts for the year, Wang said.
Analysts said layoffs in Korea and Thailand and reports of potential staff cuts at airlines in Singapore and Hong Kong may be a precursor to further staff cuts across the entire region.
"Even the more defensive airlines such as Cathay and Singapore have forewarned of such a possibility," said Andrew Tan, a regional airline analyst for ABN Amro in Singapore.
"Taiwan airlines have some disadvantages, such as relying on US traffic, and they're more leveraged, more in debt, meaning the pressure to layoff is higher," Tan said.
Besides declining passenger volumes, airlines are faced with spiralling expenses after insurers annulled coverage for any losses over US$50 million due to war or terrorism.
Airlines worldwide have been scrambling to find coverage up to the around US$1 billion to US$2 billion required by most aviation authorities before flights are allowed to land.
While the governments are coming to the rescue in most countries -- including Taiwan where the Legislature yesterday approved the 30-day, US$1.7 billion third-party war risk liability for the nation's airlines -- finding private coverage is still essential.
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