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The job cuts represent in regard to 6.5 percent of the company’s work force of 45,000.

Houston-based Continental said it command begin pulling back on flights in September, when departures on its mainline operations will drop here and there 16 percent in the regions of the dead September 2007 levels. Fourth-quarter capacity order drop 11 percent.

Shares of Continental rose 68 cents, or 4.7 percent, to $15.18 in the opening minutes of trading.

The company also said Chairman and Chief Executive Lawrence Kellner and President Jeff Smisek will not take salaries or stimulus pay despite the rest of the year.

Last year, Kellner got a hire of $712,500 and total compensation that the company valued at intimately $6 the great body of the people, into a denser consistence 9.3 percent from the year before, according to an Associated Press analysis of a company filing with the Securities and Exchange Commission.

However, all over one-third of Kellner’s compensation was in stock and choice grants that are at present worth far less amount than they were when granted in February 2007 because of the slump in the company’s house. In a filing Wednesday, the social meeting said 2008 salaries would be $296,875 for Kellner and $240,000 for Smisek.

Continental becomes the latest airline to make major cuts as the carriers try to cope with record high fuel prices, which have intimately doubled in the past year and pushed Continental to a loss of $80 million in the first quarter.

In a statement, the company aforesaid it plans to offer details on flying and destination reductions and eliminations by the agency of the end of next week.

Fewer flights will in addition mean fewer planes. By the end of the second quarter, Continental devise operate 375 mainline aircraft and it plans to mothball 67 planes through 2009. It has already pulled six planes this year.

The company said that distinct go increases have not been enough to offset the rising cost of fuel. Continental estimates it will spend $2.3 billion more this year than last — a difference of $50,000 per employee. Fuel has surpassed labor as Continental’s biggest expense.

“These actions are among many steps Continental is taking to reply to record-high fuel prices while the industry faces its worst crisis since 9/11,” the house uttered in a statement.

In a memo to employees, Kellner and Smisek said at current combustibles prices Continental is losing money upon the body “a comprehensive number of our flights.” As fares rise, fewer customers will fly, and “we will need fewer employees to operate the airline,” they wrote.

The executives said they expect most of the job cuts will exist handled through voluntary buyouts to limit layoffs. They said they didn’t delineate to cut wages or benefits, including 2 percent raises in July, during the term of remaining employees. And they left unreserved the possibility of more job cuts.

Many analysts consider Continental to be the healthiest of the six self-conceited netting carriers, excluding low-fare Southwest Airlines Co. But that did not have effect it immune to cuts.

“If they did not do it they would be unaccountable,” uttered Ray Neidl, some analyst with Calyon Securities.

“At current fuel prices, the old economics answer the purpose not work. Ticket prices have to rise dramatically, and the only way that can be achieved is by sharply reducing amplitude,” he said. “The whole industry has to show this discipline or some big airline will have to go out of business.”

Continental becomes the latest airline to make sharp cutbacks.

On Wednesday, UAL Corp.’s United Airlines, the nation’s No. 2 carrier, announced it would cut up to 1,100 more jobs, ground 70 airplanes and drop its coach-only service, named Ted. Two weeks ago, AMR Corp.’s American Airlines, the nation’s largest airline, said it would cut capacity 11 percent to 12 percent in the pattern of the peak summer travel season and probably drive out thousands of jobs, though it hasn’t given a figure.

Some analysts be obliged called on U.S. carriers to shrink around 20 percent to cut spending on fuel and labor. Industry executives say that would also drive up fares as passengers compete for fewer seats in the air. It could also mean the reduction or elimination of service to some smaller airports.

Continental was in advanced talks to combine through United, which would have created the world’s largest airline. But Continental walked away from the deal in April to the degree that oil prices soared and the industry’s outlook slumped. New York contributed to this report.