As an airline, Icelandair traces its roots back to 1937, when a fledgling airline, Flugfélag Akureyrar, was founded at Akureyri on the north coast of Iceland. After more than eight decades of operation, our history reflects the spirit of the Icelandic nation, its resourcefulness and innovation.
Starting commercial flights in a country of just 117,000 must have been no easy task, but on June 3, 1937, Icelanders took a bold step and set up a public company called Flugfélag Akureyrar. The man at the forefront of this initiative was Agnar Kofoed-Hansen, who later became Director-General of Civil Aviation in Iceland.
The new company bought a Waco seaplane and named it TF-ÖRN. The aircraft arrived in Iceland in spring 1938, and despite early difficulties, domestic flights began. In this image, Kristinn Jonsson, one of the company's employees, helps Agnar Kofoed-Hansen bring the mail ashore.
In March 1940, the company moved to Reykjavík and changed its name to Flugfélag Íslands. Two earlier companies had operated with this name for short periods in 1919-20 and 1928-31.
The Chairman of the new company was Bergur G. Gislason, and a newly qualified pilot, Örn O. Johnson, was appointed Managing Director. Johnson would later control Icelandic air transportation for many years.
The new company struggled during its first years. TF-ÖRN was badly damaged in 1941. With parts being hard to come by, they had to use parts from the old aircraft to build a new plane, but it crashed a year later, just a few days after its maiden flight. The company bought another aircraft in 1940 and named it Haförninn, but it was damaged in December 1943.
In spring 1942, Icelanders were delighted to acquire their first twin-engine aircraft. It was a conventional 8-seat Beechcraft D-18, and its arrival heralded the start of regularly scheduled flights. It flew from Reykjavík to Akureyri, Egilsstadir and Hornafjörður.
Haförninn was damaged beyond repair in a non-fatal crash at Hornafjörður on December 3, 1943. Until the summer of 1944, the Beechcraft was Flugfélag Íslands only aircraft.
The two aircraft companies, Flugfélag Íslands and Loftleidir, continued to add to their fleets in the following years. In summer 1944, Flugfélag Íslands operated two brand-new De Havilland Rapide land-based planes in addition to the Beechcraft.
Loftleidir equipped itself with a new Stinson and a Grumman Goose flying boat. Many additional aircraft were added to the Icelandic fleet in 1944.
The two companies were flying high, carrying passengers and freight to many destinations all around the country.
Herring was vitally important for many towns in northern Iceland during the 1940s. It was also a great boost for flyers. Contracts for herring searches from the air were a vital part of Loftleidir business in its early years.
In 1944, Alfred Elíasson and Kristinn Olsen lived in a tent beside Lake Miklavatn for the whole of the summer while flying in search of the shoals. They flew up to 300 hours on the lookout for the 'silver of the sea.' But at the end of the season, the Stinson aircraft was damaged while taking off from the water. The plane was put on a truck for transport to Reykjavík, but ran into telephone lines on the way and was seriously damaged.
Loftleidir's first aircraft never flew again. However, the men didn't give up, and the following summer the company had two aircraft, for herring searches and for passenger transport.
"It looked like a large dance hall," said Alfred Eliasson, after his first view of a Douglas DC4 Skymaster, the plane that Loftleidir bought in 1947. This type of aircraft was often called "The Four" (Fjarkinn) in Iceland, and it was regularly used on international routes for the next decade.
The first Skymaster was named Hekla. Loftleidir, now known abroad as Loftleidir Icelandic, bought a second aircraft in 1948 and called it Geysir. In the same year, Flugfélag Íslands, or Icelandair, bought the first in its "Gullfaxi" series, also a Skymaster. These highly respected aircraft carried 46 passengers. They were Iceland's first serious long-haul aircraft.
Icelandair was next to move forward, buying Iceland's first jet. It was a Boeing 727-100C, and it arrived in 1967. The jet was specially fitted for the airline, and the passenger cabin was decorated with typical Icelandic scenes. It was named "Gullfaxi," just like the company's previous flagships. The plane was a technological masterpiece; its passenger compartment could be made larger or smaller depending on how much freight had to be carried, making it an ideal choice for the company. However, the jet was not allowed to land at Reykjavík Airport, and Icelandair's international flights were moved to Keflavík.
The Icelandic airlines prospered on international markets during this time. Flights to Greenland were added to the growing list of routes, and the first charter flights to holiday destinations were booked. Sun-seeking Icelanders flew to the Canary Islands and Mallorca (Spain) in the winter, and other hotspots in summer.
Icelandic aircraft were put to good use when war broke out in Biafra in west Africa in 1967-70. The war caused devastating human suffering, and Nordic Christian charities tried to help by sending food to starving people. Two of Loftleidir Icelandic's DC-6B aircraft were used.
In 1969 a special company, "Flughjálp" or "Aid by Air," was established to take over this work. Loftleidir Icelandic owned a 20% share of this company. Many Icelandic pilots took part in Biafra flights, including Thorsteinn E. Jónsson, who controlled flights for the last 16 months of the war.
Operations were becoming difficult for the Icelandic airlines. The competition was intense, especially in the Nordic countries, and in 1970 it became clear that some sort of government assistance was necessary to keep the industry aloft.
Various partnership and merger proposals were put forward, but getting the two airlines to meet proved difficult. They finally agreed to formal talks late in 1971. The discussions dragged on into the summer of the following year and nothing came from them. The matter now passed into the hands of the government.
A year after Loftleidir Icelandic acquired Air Bahama, it was able to extend its use of jets to all its original scheduled routes. A new contract with the USA allowed it to keep its low-fare structure while using the faster planes.
The company took three DC-8-63s on a lease-purchase plan in 1971 and then used jets on all its scheduled routes. The redundant Canadair "monsters" were put up for sale. No buyer emerged, and they were restored to operate in their original role as cargo carriers.
This idea led to the establishment of the Cargolux freight company, in partnership with the Swedish shipping company Salenia and Luxair. This enterprise quickly gained a strong foothold in the market, and became one of the largest cargo carriers in the world, providing jobs for many Icelanders over the years.
Late in 1972, the government decided to enforce the merger of Loftleidir Icelandic and Icelandair and a committee was appointed to oversee unification discussions. There was disagreement about some aspects of the merger but the companies' operations were now so uncertain that most people admitted the economic sense of the merger.
The two airlines reached agreement on April 11, 1973, and Flugleidir was established on July 20 of the same year. Örn O. Johnson and Alfred Elíasson were appointed to manage the new company, and Sigurður Helgason joined them a year later. Sigurður had been Managing Director of Loftleidir Icelandic in the USA.
Even after the merger of the two airlines, Flugleidir, the new company, remained in financial difficulties for some years. A reduction in international passengers did not help matters but charter flights helped keep the company in business. A growing number of Icelandic and foreign passengers wanted to fly to destinations not served by scheduled flights, especially groups of pilgrims. The timing of the Islamic pilgrimage to Mecca was particularly convenient for Flugleidir; it took place in wintertime when planes and crews were unused.
At first, the airline transported baggage only, but over the next few years, it flew tens of thousands of pilgrims from Nigeria, Algeria and Indonesia to Jeddah, in Saudi Arabia. In addition, a strong partnership developed between Flugleidir and Air Algeria, which resulted in the Icelandic airline operating part of the African company's schedules. The pilgrim flights ended in 1984, when the religious festival was moved to Flugleidir's busy period. The partnership with Air Algeria continued until 1986.
The merger process was for the most part finished by the start of the 1980s. An economic recession brought a steep drop in passenger numbers; oil prices rose sharply, and competition became fierce. Icelandair needed to take preventive action; schedules were drastically cut and, unfortunately, staff were laid off - but even that was not enough.
The company asked the governments of Luxembourg and Iceland to subsidize its operation. Assistance was granted, but the Icelandic government imposed a range of requirements. Among them was the stipulation that the Treasury would acquire a 20% share in Icelandair and two seats on the company's Board of Directors. The financial scene calmed down a few years later and Icelandair repurchased the share from the State in 1985.
The old airport buildings at Keflavík Airport were temporary structures, built in the middle of the military base in 1949. Their expected lifetime was a maximum of 20 years. However, they remained in service for much longer. The first steps towards separating military and civil flights were taken in 1970, but work on a new terminal didn't start until October 7, 1983.
The design of the new buildings took a long time; disputes about size and the participation of Americans further lengthened the process. In the meantime, passengers and crews had to put up with the old temporary sheds that were only recognizable as an airport because of the sign hanging on the side of one of the buildings.
In 1983, Icelandair celebrated its 10th anniversary in style at Reykjavík Airport. The airline announced its decision to resume naming its aircraft.
Its Boeing 727-200 TF-FLI became known by the name Frónfari, and the Fokker F27 TF-FLR was named Vorfari.
On June 3, 1987, Icelanders celebrated 50 years of commercial flights; half a century had passed since Flugfélag Akureyrar, one of the predecessors of Icelandair, came into being.
The first step in the renewal of the fleet was announced. At the anniversary board meeting, the Icelandair Managing Director signed an agreement with Boeing for the purchase of two 737-400 jets and options on two others.
This was the start of the recreation of the airline. The Icelandair board changed significantly, Sigurður Helgason (the older) became Chairman in 1984, and Sigurður Helgason (the younger) was appointed Managing Director. They had a lot of work to do but after years of economising, they began replacing almost everything the company owned: the aircraft, hangars, hotels, and rental cars.
This image is from the signing of the agreement with Boeing at the anniversary meeting. Borge Boeskov, the Boeing representative, stands before a gathering of the Icelandair managers.
The new air terminal finally opens, a splendid structure covering 15,000 sq ft. The opening celebration took place in front of 3000 people on April 15, 1987, when the building was named the Leifur Eiriksson Air Terminal. The original plan was for a larger building, but this was thought to be unnecessary. No one expected the number of passengers passing through the terminal to rise as much as it did; within a few years, the terminal was struggling to cope with the influx of passengers.
When the first shovel was sunk into the site of the foundations, 460,000 passengers arrived or departed from Keflavík Airport annually. In 2016, that figure surpassed 6 million. The building has been extended twice, and in 2016 Leifur Eiriksson Air Terminal covered 61,000 sq meters.
At this time, Icelandair moved into a new 4000 sq meter service centre. It housed the freight division, kitchens and engineering workshop. There was also a bonded warehouse for duty-free goods to be sold on international flights. The high-flying shop was named Saga Boutique.
Substantial changes were made to domestic flights in the mid-1990s. The market was opened in 1997 and, up until then, the government applied a system of special licenses to control domestic commercial flights. Icelandair prepared for the changes by creating a new company, especially for domestic routes. Flugfélag Norðurlands and Icelandair's domestic carrier merged to form an independent Icelandair subsidiary. Flugfélag Íslands, the fourth company with that name, entered the market.
A price war on the most popular routes broke out after the market was opened, with prices dropping up to 40% while passenger numbers increased by only 20%. Having to run at a loss like this put some airlines out of business. In order to remain in operation, Flugfélag Íslands did all it could to improve efficiency. The workforce was reduced and tickets were no longer issued. Passengers gradually began booking their seats on the internet. These measures were effective: in 2002, the domestic carrier recorded a profit of $1.7 million.
Passenger numbers reached 400,000 in 2006. Their destinations were Akureyri, Egilsstaðir, Ísafjörður, the Westman Islands, the Faroe Islands and the Greenland towns of Kulusuk, Narsassuak and Nuuk, in addition to Reykjavík. Flights also operated from Akureyri to Grímsey, Þórshöfn and Vopnafjörður.
In 2007, the domestic fleet consisted of six Fokker 50s, two DASH 8-100s and one Twin Otter aircraft.
On Women's Rights Day, June 19, 1999, an Icelandic airliner was flown by an all-female crew for the first time. The captain was Geirthrudur Alfredsdóttir, assisted by Linda Gunnarsdóttir. The flight attendants were led by the captain's sister Katrin Alfredsdóttir, both daughters of the founder of Loftleidir, Alfred Eliasson.
Two years later, another notable flight took off with female pilots and male flight attendants - an interesting reversal of the traditional roles of airline crews. At that time, Icelandair employed 240 captains and pilots, of whom only eight were women.
Cargo flights have always played an important role in Icelandair operations. When the company was established in 1973, a special cargo division was created that has since grown year by year. Freight is carried in special cargo aircraft as well as in the holds of passenger aircraft.
At the beginning of the new millennium, the cargo division formed a new subsidiary to attend to the construction of a freight handling centre at Keflavík, which opened in 2001. In 2017, Icelandair Cargo operates two B757-200 cargo aircraft that fly between 50 destinations in Europe and North America.
Icelandair Group was established in October 2005, a holding company with 10 subsidiaries operating air and tourism services. The largest of the group's operations is the international carrier Icelandair. Other companies in the group include Loftleidir Icelandic, Icelandair Cargo, Icelandair Ground Services, Vita, Flugfélag Íslands (now called Air Iceland Connect), Icelandair Hotels, Iceland Travel, and Fjárvakur.
In December 2006, Icelandair Group (ICEAIR) was registered as a public company on the Icelandic stock exchange.
Icelandair Group, a descendant of Flugfélag Akureyrar, celebrated 70 years of flying in the company's hangar at Akureyri Airport on June 3, 2007. To mark the occasion, the company presented the Aircraft Museum with a Stinson Reliant airplane, exactly like the aircraft that arrived in Iceland in 1944.
At this time, Icelandair Group is operating all around the world, embracing nine companies in the aviation and tourism sectors.
By 2011, Icelandair was operating regular, scheduled flights to more than 30 destinations in Europe and North America. At the time, it was the largest schedule in the company's history.
#MyStopover is introduced, the first global campaign in the company's history, which highlights the Icelandair Stopover. Icelandair has offered this service to passengers since the early 1960s, passengers can stopover in Iceland on their way across the Atlantic at no additional airfare.
Flights to three new destinations commence: Edmonton and Vancouver, Canada and Geneva, Switzerland.
Three new Boeing 757-200s are added to the fleet, which now consists of 21 aircraft.
Passenger numbers grow by about 315,000 from the previous year.
Icelandair celebrates 70 years since the first international flight took off from Iceland, when a crew of four flew passengers to Largs Bay in Scotland in 1945.
A new, global marketing initiative was launched in early 2016. The Icelandair Stopover Buddy service allowed passengers who stopover in Iceland on their way across the Atlantic to ask for a travel buddy, who is also an Icelandair employee. The initiative was called "the best marketing gimmick of 2016" by The Daily Mail.
Three new destinations were added to the route network, giving passengers even more options: Chicago, Montreal and Aberdeen. Icelandair resumed service to Paris Orly International Airport in addition to flying to Charles de Gaulle.
With more destinations and more trips, Icelandair added a Boeing 767 wide-body jet to its fleet.
In the summer, Icelandair transported Iceland's men's national football team to their first-ever major tournament, when they participate in the European Championships in France. To the delight of the nation, the team finished in the top eight.
Icelandair revolutionized service on board by introducing a cashless cabin. Passengers are allowed to pay with all major cards, both debit and credit.
Icelandair became the first European airline to offer fleet-wide gate-to-gate Wi-Fi.
Two new destinations in the US were added to the route network: Philadelphia and Tampa. Flights to Cleveland and Dallas-Forth Worth are announced for 2018; they are joined by Berlin (from late 2017) and Dublin (from 2018).
In 2017, Icelandair celebrated 80 years in the air. In celebration of the airline's 80th anniversary, the company pioneered a new form of in-flight entertainment: the immersive on-board theatre production, ‘Ahead of Time.’ The plotline of the performance championed the airline’s history as pioneers of modern-day travel.
As an aviation pioneer, Icelandair continues to grow by adding new aircraft to its modern fleet, plus more destinations and popular amenities. Today, the company flies to 20 North American gateways and more than 25 cities in Europe. It´s projected that Icelandair will transport four million passengers in 2017.
In October 2019, Icelandair introduced a new carbon calculator, allowing travelers to offset their carbon footprint on their Icelandair flight.
The calculator enables passengers to quantify the environmental impact associated with their flight and the contribution necessary to offset it.
This initiative is delivered in partnership with the Iceland Carbon Fund, Kolviður, allowing travelers to contribute to Iceland's forestation and carbon capture efforts.
In March 2021, Icelandair and the domestic airline Air Iceland Connect integrated their operations, thereby adding a number of domestic routes to Icelandair's network, as well as flights to Greenland.
The airline now delivers travel options for those arriving, exploring, or departing Iceland and we make it easier for Icelandic families to keep in touch.
In 2022 Icelandair updated our livery with colors drawn from Icelandic nature, including the northern lights. The base colors are midnight blue and white, and the new palette includes boreal blue, magenta, crisp blue, golden yellow, and green.
This was the first time the whole livery design was changed since 2006, and was part of a complete refresh of the Icelandair brand. We looked to find new, refreshing ways to bring the spirit of Iceland to the world.
Fleet renewal is currently the most effective measure for airlines to reduce emissions, and Icelandair is proud to be renewing and expanding our fleet. Ideally suited to transatlantic routes, the A321LR from Airbus is the newest addition to our fleet, with the first arriving in Iceland in December 2024.
We also signed a contract for the purchase of Airbus A321XLR aircraft, taking delivery from 2029 as we gradually retire our Boeing 757s. The Airbus aircraft are more fuel efficient and emit lower carbon emissions per unit than older-generation aircraft.