LOT Polish Airlines has created plans to operate a seventy aircraft fleet, of which sixteen will be Boeing 787s. They also aim for an annual passenger throughput of 10 million by 2020, says chairman Rafal Milczarski.
Milczarski said their new four-year business plan (adopted during the 26th Economic Forum in Krynica this week) will see the airline place more focus on international expansion, justifying their need for widebody aircraft.
The Polish carrier is coming under greater pressure on both domestic and regional European fronts from carriers like Ryanair, hence the need to fly further abroad to newer and more commercially viable markets.
“Long-haul flights are the most profitable part of our business and being the only airline in the region, LOT has the related growth potential. We are mostly going to focus on developing flights to North America and the most important business centers in Asia.” – Rafal Milczarski, Airline Chairman
The new markets the airline are going to target will include Shenzhen, China (Asia) and switch New York services back to Newark with 4x weekly flights initially, then 5x weekly in Summer 2017 (North America). The flights targeting China will be in the same location as their fellow Star Alliance member Shenzhen Airlines (ZH, Shenzhen) and their primary hub.
“Connections to Central Asia and to the Middle East are particularly interesting from our perspective. Warsaw’s geographical location allows to develop an unmatched offering of flights to countries such as Kazakhstan or Iran. We are going to take advantage of that potential.”said Milczarski
Whilst expanding their international footprint, LOT airlines are also trying to recover lost local market share. The chairman stated LOT was looking to reclaim 25% share by the year 2020, requiring them to exceed 10 million passengers annually as oppose to 2015’s 4.3 million.
“As new long-distance flights are launched, the number of short-distance flights, especially from Central and Eastern Europe, is going to go up as well. We assume that the percentage of transfer passengers, that is, those who change planes in Warsaw, is going to reach approximately 50% in 2020.”
Currently, LOT airlines operate six B787-8s, but are due two more from Boeing this year and next year. Milczarski said the new B787s are going to be acquired through sale/lease back agreements with third party firms in order to ease the financial situation.
Fifteen new 150+ seater narrowbody aircraft will also be joining LOT from next year onward despite Milczarski saying negotiations are at an early stage. Based on LOT’s intentions to standardize their fleet, it is likely that the aircraft will be Boeing.
Polish Treasury Minister Dawid Jackiewicz said that the government (LOT’s largest shareholder) had no intention of letting them go.
“We’re not going to let go of control,” he said. “We intend to keep LOT in our hands and prove that it can become a leader in Central and Eastern Europe.”