UPDATE 1-Poland's LOT will not fly Dreamliners until October

Thu Feb 14, 2013 10:13am EST

By Chris Borowski

WARSAW Feb 14(Reuters) - Poland's ailing airline LOT said it does not plan to fly its new 787 Dreamliners until late October, missing the vital summer season, and expects Boeing to treat it as a special client in tackling the jet's problems.

LOT, the first European airline to add Boeing's newest passenger jet to its fleet, has taken delivery of two planes and was to receive three others by the end of next month.

But last month the U.S. Federal Aviation Administration (FAA) grounded all 50 Boeing Dreamliners in commercial service after a series of battery-related incidents, including a fire on a parked 787 at Boston's Logan International Airport.

LOT's new Chief Executive Sebastian Mikosz said on Thursday the uncertainty over when the Dreamliners would be allowed to return to the sky had forced the carrier to plan the crucial summer season without the new jets.

"Based on our knowledge of the progress of work on the problems investigated by the FAA, we decided that we will not plan to use the Dreamliners in our network to the end of October. At all," Mikosz said.

LOT had put the Dreamliners at the heart of its turnaround strategy that would rely more on long-haul flights. It planned for the new jets to replace all of its ageing 767's.

"I expect today, and I think I have the right to after 25 years of cooperation, for Boeing to help us, a special client," he added, but did not elaborate.

LOT has already indicated it would seek compensation from the U.S. aircraft maker.

The Dreamliner problems add to the growing troubles of the 87-year-old Polish carrier, which received 400 million zlotys ($129 million) in state aid in December to prevent it from running out of cash.

LOT's net losses totalled some $420 million since 2008.

Mikosz, who return to the helm four days ago after a stint in 2009-10, said he was committed to save LOT and to privatise it as soon as this year, despite its poor financial standing.

LOT, which has previously said it would need more cash from the government, is awaiting clearance from the European Commission for the state aid.

If the European Union's executive body rules against it, LOT could share the fate of Hungary's Malev, which collapsed a year ago after it was forced to give back millions of euros in state loans.

Mikosz confirmed the Polish carrier is looking to cut more than 500 jobs and significantly reduce the number of its connections.