New CEO of LOT Polish Airlines eyes growth with fleet overhaul

ZURICH (Reuters) - LOT Polish Airlines [LOT.UL] is planning an overhaul of its narrowbody fleet with the addition of some more aircraft to better compete with low-cost rivals in the fast-growing eastern European market and add routes out of its Warsaw hub, the carrier's new chief executive said on Saturday.

"We are interested in increasing the significance and scope of our hub in Warsaw," Rafal Milczarski, who took up his post at the end of January, told reporters at an event in Zurich hosted by the Star Alliance grouping of international airlines.

He said due to previous management issues and some technical problems, state-owned LOT had not made the most of the fast-growing market for travel demand in eastern Europe, unlike low-cost rival Wizz Air (WIZZ.L).

Ireland's Ryanair (RYA.I) is currently the market leader in Poland with a market share of over 30 percent and is challenging LOT by moving domestic Polish flights to Warsaw Chopin airport, from Modlin.

LOT is also at a disadvantage because it flies busy routes with smaller Embraer (EMBR3.SA) regional jets while rivals use larger Boeing (BA.N) 737s, Milczarski said, meaning adding new planes was a priority.

As a result he said he had been speaking to lessors about narrowbody options at the IATA airlines industry association gathering in Dublin earlier this week.

"A decision will be taken very shortly and the aircraft will arrive in our fleet in the first quarter of 2017," he said, adding that the group wants to double or triple the size of its narrowbody fleet, which currently consists of just three 737s.

LOT's widebody fleet will also rise to eight aircraft when two new 787 Dreamliners enter the fleet next year.

(Reporting by Victoria Bryan; Editing by Greg Mahlich)