The much-feared shakeout in the Indian aviation industry began to hit home on Wednesday as hundreds of employees of leading private airline Jet Airways took to the streets in protest after they were fired overnight, a move the company said was in the greater interest of regaining viability and security its economic health.

While the company said it had “released” 800 flight attendants recruited recently for Jet’s planned expansion programme, it added another 1,100 employees to that list later in the day and said they would include probationary and unconfirmed personnel in other areas including cockpit crew and management personnel.

Aviation industry sources said that this seemed like the beginning of a bloodletting in the sector and other airlines, including Vijay Mallya’s Kingfisher Airlines which joined hands with Jet only two days ago to share facilities and cut costs, could follow suit. Kingfisher last month sacked 300 employees, many of them from Air Deccan with which it merged earlier this year. A top Kingfisher official, however, told The Indian Express that it was “very premature for anybody to jump to a conclusion that it would lay off employees just because Jet had done so”.

“It is an unfortunate decision, which all of us in the company regret but it is an attempt to save the company and the jobs of the remaining employees,” Jet Airways Executive Director B Saroj Dutta told a news conference at the airline’s headquarters in Mumbai.

Airlines around the world have been hit hard by rising oil prices and falling traffic, which has been compounded by the global financial crisis. While state-run Air-India posted a loss of over Rs 2,100 crore in 2007-08, Kingfisher’s losses were over Rs 1,000 crore and that of Jet over Rs 800 crore during the same period. Domestic traffic fell by 5.3 per cent in August to 29.2 lakh from 31 lakh in July.

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