HONOLULU -- Hawaiian Airlines Chairman John Adams has warned that both Hawaiian and Aloha airlines have been meeting to plan reductions in inter-island service later this year.

The airlines have been granted a federal anti-trust exemption.

Published reports quote Adams as saying Hawaiian employees should expect job cuts.

Local residents will see scaled back inter-island flights.

At a ceremony Wednesday to decommission Hawaiian's oldest plane, Adams confirmed that the cuts were coming, but said he's not ready to announce specifics.

"The airline industry and Hawaiian Airlines (have) been going through a difficult period as everyone knows and (we have) issues we're going to have to deal with going forward. You'll hear a lot from us about that, but today we'd like to take a step back, make this a special ceremony not interrupted by getting down to business," Adams said.

Aloha Airlines wouldn't give details, but officials said the changes should be in place by Dec. 1.