The budget airline Ryanair announced today it was axing 12 routes and cutting 400 jobs on its rival carrier Buzz, which it is taking over on April 1.

Ryanair also confirmed that it was grounding all Buzz flights "for the month of April 2003, at least".

The Irish low-cost airline added that a final decision would follow soon "on whether to restart [Buzz] flying on May 1, or close Buzz altogether".

Ryanair said the financial position of Buzz, which is owned by the Dutch airline KLM and which is being bought for £15m, was "extremely precarious". It was currently losing more than 1m euros (about £690,000) a week, had unsuitable planes, a poor schedule and too-high fares, said Ryanair.

The Buzz routes to be terminated are Paris Charles de Gaulle, Amsterdam, Marseilles, Toulon, Tours, Bergerac, Caen, Dijon, Geneva, Chambery, Brest and Almeira.

Ryanair said that passengers who had booked on flights after April 1 would be offered a full refund and that passengers would then be able to rebook with new tickets, at lower prices, from March 12 to existing or alternative destinations.

The Irish airline also said that the 400 redundancies would include about 25% of Buzz's pilots, up to 80% of its cabin crew, all cargo and group sales staff and around half of Buzz's ground operations staff at Stansted airport in Essex.

Ryanair also announced that there would be increased frequencies on Buzz's 12 remaining routes, on which fares would be 50% lower. These routes include Frankfurt, Berlin and Bordeaux. Buzz's fleet will be reduced from 12 to eight aircraft, while there will be increased pay and productivity allowances for Buzz's remaining 200 staff.

Ryanair said today: "Buzz management will be briefing all staff this week that if agreement is not forthcoming within two weeks from the remaining 200 staff who will be offered continued employment in Buzz, then Buzz will be closed on April 1.

"In those circumstances, Ryanair would take over the operation and flying of these routes from May 1. However, Buzz believes that this will not be necessary, as staff will be delighted with the better terms and conditions and increased pay which they will be offered by Buzz from April 1."

Ryanair added that Buzz was currently "heavily overstaffed" and carried fewer than 3,000 passengers per employee compared to Ryanair's figure of almost 10,000 passengers per employee.

The Irish carrier went on: "One of the major contributors to Buzz's current losses is the fact that many of its routes are served inadequately, either once a day when they should be twice or three times daily, or just three or four times weekly when they should at least be daily."

· The Sun claimed today that British Airways was considering retiring Concorde early because it is not making enough money.