Bahrain's national carrier Gulf Air will combine its first class and business class, starting on March 1, its chief executive said on Sunday, as the loss-making airline looks to reduce costs.

'We decided to move to one super business class offering by combining the two cabins without changing the seating,' Sameer Majali told Reuters over the phone.

Majali said one reason for the change was that a large amount of Gulf Air's traffic consisted of passengers transiting through Bahrain and it would be easier to cater to them with just one premium offer.

'A similar product across our airplanes will make things easier for us', he said. The carrier has been reducing costs by closing unprofitable routes and has said it planned to cut job positions through natural attrition.

The global slump in air travel demand has in particular hit airlines' premium offers, with many corporates shifting their bookings to cheaper classes to save costs.

Australia's Qantas said last week it would reduce its first class seats on some routes flown by its Airbus A380 aircraft fleet. Gulf Air plans to shift its order book from wide-body to narrow body planes and regional jets as it changes its route network to focus on regional traffic.

Gulf Air was established as a regional airline but has struggled to find its niche. Previous shareholders Oman, Abu Dhabi and Qatar gave up their stakes, after which ownership of the carrier was transferred to Bahrain's sovereign wealth fund Mumtalakat in 2007.

Mumtalakat said earlier this month it would transfer ownership of the carrier to the Bahraini government.-Reuters