Facing rising competition from rival carriers, Hong Kong’s Cathay Pacific Airways on Monday announced its decision to sack almost 600 employees from its head office in Hong Kong. This is the biggest round of job cuts by Hong Kong’s flag carrier in nearly 20 years.

Cathay reported a loss of $74 million (Rs 477 crore) in 2016, which was its first annual loss since 2008, reported the Economic Times. The company blamed its poor performance on increased competition from both mainland Chinese airlines and Asian budget carriers. It also said that the slowing Chinese economy had compressed travel demand.

Around 190 managers are likely to be fired as the airline said it plans to axe around a quarter of all the company’s management jobs. In addition, 400 people in non-managerial roles are also expected to be laid off. The airline said most of the layoffs will be completed by the end of 2017, according to Economic Times.

Currently, this decision will not affect the frontline workers, including cabin crew and workers. However, Cathay said in a statement that they “will also be asked to deliver great efficiencies and productivity.”

This is the company’s most sweeping overhaul in nearly 20 years. In 1998, the Asian Financial Crisis had forced them to lay off nearly 800 employees.

CEO Ruper Hogg, who was promoted to the position earlier this month in a complete corporate overhaul, said the company had to make “tough but necessary decisions for the future of the business.”

“Changes in people’s travel habits and what they expect from us, evolving competition and a challenging business outlook have created the need for significant change,” he said in statement.

A redundancy package of 12 months salary, counselling and extended medical benefits will be provided to the affected employees, reported IANS.