British Airways is to ground 16 aircraft for the upcoming winter season, to rein in capacity following the sharp decline in passenger demand.

It will ground eight Boeing 747-400s and eight 757-200s in order to cut capacity by 4% for winter 2009-10.

BA has already laid plans to sell the 757 fleet to another operator for cargo conversion.

The airline has already increased its capacity reduction for the summer season to 2.5% from the 2% it disclosed in March.

Over winter 2008-09 the airline cut capacity by 3.1%.

BA says it has the flexibility to withdraw more of its long-haul aircraft, notably as the number of jets in its fleet older than 20 years - some of its Boeing 747-400s and 767s - is set to increase. Sixteen of its 121 long-haul aircraft will be above this 20-year threshold in 2010-11.

"We are taking action to mitigate the impact of the economic crisis on our business," said BA chief Willie Walsh, after detailing a heavy full-year operating loss for the airline of £220 million ($349 million).

BA's operating loss in the fourth quarter reached £309 million, as revenues dropped by 8.4% to £1.9 billion. Yields were down 2.5%, but 16% excluding exchange.

Source: Air Transport Intelligence news