Icelandair
Corporate brand
UnclaimedIceland's flag carrier, linking Iceland with Europe and North America through Keflavík.
Last updated November 4, 2026
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Overview
Icelandair is Iceland's flag carrier and the principal airline brand of Icelandair Group. Its modern network is built around Iceland's position in the North Atlantic: passengers can travel between Europe and North America with a connection at Keflavík International Airport, while the airline also serves traffic to, from, and within Iceland. The carrier's main international hub is Keflavík, near Reykjavík, and Reykjavík Airport supports domestic operations through the group's domestic airline activities. The company's headquarters moved to Hafnarfjörður in 2024 after more than five decades at premises associated with the former Loftleiðir operation near Reykjavík Airport. The airline's roots reach back to 1937, when Flugfélag Akureyrar was established in Akureyri. Operations began in 1938 with a floatplane, but an accident ended the first operating phase. In 1940 the company moved its base to Reykjavík, adopted the name Flugfélag Íslands, and resumed scheduled flying. For international purposes it used the name Iceland Airways, which later developed into the Icelandair brand. During the post-war period the airline expanded from domestic seaplane and landplane services into flights to Britain, Scandinavia, and other European destinations. Its fleet evolved from small utility aircraft to Douglas airliners, Vickers Viscounts, and eventually Boeing jets. A second important predecessor was Loftleiðir, founded in 1944 by three Icelandic pilots. Loftleiðir concentrated on international flying and launched a pioneering low-fare North Atlantic service in 1953. Its relatively inexpensive transatlantic product attracted students, younger travelers, and independent tourists, giving it the informal reputation of the “Hippie Airline.” Loftleiðir later operated Douglas DC-8 aircraft, acquired International Air Bahama, and helped establish the cargo carrier Cargolux. Economic pressure during the 1970s energy crisis led to the creation of the Flugleiðir holding company in 1973. The two predecessor airlines were legally combined in 1979, and the unified airline was renamed Icelandair. Following the merger, Icelandair gradually developed the connecting model that defines its business today. Boeing 757-200 aircraft became the principal transatlantic type during the 1990s, while European services and domestic flying used other narrow-body and regional aircraft. The airline's Luxembourg hub, inherited from Loftleiðir, was phased out during the late 1990s in favor of a network centered on Reykjavík and Keflavík. In 1997, domestic operations were separated into Air Iceland, allowing the mainline brand to focus more clearly on international flying. A new livery and image campaign introduced in 1999 sought to move the brand away from its backpacker image and toward a broader business and leisure proposition. The wider corporate structure was reorganized during the early 2000s, with the aviation business becoming part of Icelandair Group. Icelandair moved its principal hub to Keflavík International Airport in 2001. The September 11 attacks, the 2008 financial crisis, and volcanic eruptions in Iceland tested the airline's resilience. During the 2010 Eyjafjallajökull eruption, ash restrictions disrupted European aviation and temporarily forced Icelandair to relocate staff and operate from Glasgow while maintaining links to Iceland through Akureyri and ground transport. The airline participated in the recovery effort behind the “Inspired by Iceland” tourism campaign. A later eruption at Grímsvötn in 2011 caused a smaller disruption. During the 2010s Icelandair expanded its North American and European network, adding or announcing destinations including Washington, Denver, Anchorage, Vancouver, Edmonton, Portland, Chicago, Birmingham, and Geneva at various points. It also developed branded aircraft and onboard experiences, including Hekla Aurora, a Boeing 757 featuring northern-lights-inspired exterior artwork and cabin lighting. Today the brand combin…
History
Icelandair developed from two historically important Icelandic airlines. Flugfélag Akureyrar was founded in 1937 in Akureyri and began flying the following year with a floatplane. After an accident grounded the initial operation, the company moved to Reykjavík in 1940, adopted the name Flugfélag Íslands, and resumed scheduled services. It used Iceland Airways internationally and expanded from domestic flying into routes to Britain and Northern Europe. Aircraft such as the Douglas DC-3, Douglas DC-4, Vickers Viscount, and Boeing 727 marked successive stages in its development. Loftleiðir was founded in 1944 and began international scheduled services in 1947. After leaving the domestic market, it concentrated on low-fare international routes and became known for economical North Atlantic travel. Its service attracted younger and budget-conscious travelers, producing the “Hippie Airline” nickname. Loftleiðir later operated Canadair CL-44 and Douglas DC-8 aircraft, acquired International Air Bahama, and participated in the founding of Cargolux. Economic difficulties and the 1970s energy crisis encouraged the Icelandic government to promote cooperation between the two companies. A holding company, Flugleiðir, was created in 1973, and the operating airlines were combined in 1979. The unified company adopted the Icelandair name. During the 1980s it experienced financial strain and received government support. In the 1990s the Boeing 757-200 became central to transatlantic operations, while the company shifted away from its Luxembourg hub and built a more decentralized European network connected through Iceland. Domestic activities were reorganized in 1997 through Air Iceland, enabling Icelandair to emphasize international routes. A 1999 rebranding introduced a more contemporary visual identity and sought to broaden the carrier's appeal beyond its backpacker reputation. In 2001 the main international hub moved to Keflavík International Airport. The aviation business was subsequently organized within Icelandair Group. The airline faced major operational shocks after the September 11 attacks, the 2008 financial crisis, and volcanic eruptions in Iceland. The 2010 Eyjafjallajökull eruption caused extensive disruption across European aviation. Icelandair created a crisis response structure, preserved flights where possible, and temporarily based operations in Glasgow when Keflavík was affected. It also helped support the “Inspired by Iceland” tourism-recovery campaign. The smaller Grímsvötn eruption caused a further but less severe interruption in 2011. From 2011 onward, Icelandair expanded its scheduled network in the United States, Canada, and Europe. Destinations announced or served during this period included Washington, Denver, Anchorage, Vancouver, Edmonton, Portland, Chicago, Birmingham, and Geneva. The company also used distinctive aircraft branding, notably Hekla Aurora, to connect the airline experience with Icelandic nature. In 2024 the headquarters moved to Hafnarfjörður. The brand remains focused on scheduled international passenger flying through Iceland, supported by the broader activities of Icelandair Group.
- 2024
Headquarters move to Hafnarfjörður
[1]The airline consolidates its headquarters in Hafnarfjörður.
- 2014
Hekla Aurora is unveiled
[1]Icelandair presents a northern-lights-themed Boeing 757 aircraft.
- 2010
Volcanic ash crisis
[1]The Eyjafjallajökull eruption disrupts European airspace and prompts temporary operations from Glasgow.
- 2001
International hub moves to Keflavík
[1]Icelandair shifts its principal international hub to Keflavík International Airport.
- 1999
New brand identity is introduced
[1]A new livery and image campaign reposition the airline beyond its backpacker-era identity.
- 1997
Domestic operations are separated
[1]Domestic activities are combined into Air Iceland, allowing Icelandair to focus on international services.
- 1979
The airlines merge under the Icelandair name
[1]Flugfélag Íslands and Loftleiðir are merged into Flugleiðir, subsequently branded Icelandair.
- 1973
Flugleiðir holding company is created
[1]The two predecessor businesses begin a formal combination during a period of economic pressure.
- 1967
Jet age begins for Flugfélag
[1]Flugfélag becomes the first Icelandic airline to operate jet aircraft with a Boeing 727.
- 1953
Low-fare North Atlantic service begins
[1]Loftleiðir launches a pioneering low-fare transatlantic model.
Products and positioning
A full-service flag carrier using Iceland's North Atlantic location to provide convenient one-stop connections between Europe and North America, alongside a strong Iceland travel proposition.
Passenger aviation
Scheduled international passenger services
Icelandair's core product is scheduled passenger transportation between Iceland, Europe, and North America. The network is structured around Keflavík International Airport, allowing the airline to serve both local Icelandic demand and connecting passengers traveling across the Atlantic.
Passenger aviation · 1997
Domestic air services
Domestic flying in Iceland has historically been associated with the wider group and was organized under Air Iceland from 1997. Reykjavík Airport serves as the principal domestic hub, complementing Icelandair's international operation at Keflavík.
Aviation services
Cargo and charter aviation
The Icelandair Group has also operated cargo-related, charter, and wet-lease activities. These capabilities extend the group beyond the scheduled Icelandair passenger brand and draw on the group's historical links with Loftleiðir and Cargolux.
Marketing campaigns
- 2010Inspired by Iceland
International
Following the Eyjafjallajökull eruption and the resulting travel disruption, Icelandair participated in and helped initiate a national tourism campaign intended to restore confidence in visiting Iceland.
Outcome. The campaign supported Iceland's tourism-recovery effort after the eruption.
- 1999Brand identity repositioning
Iceland · Europe · North America
A new aircraft livery and image program sought to replace the airline's backpacker-oriented reputation with a broader business and leisure positioning.
Outcome. The campaign marked a long-term shift in the public presentation of the brand.
Brand decisions
2014
Launch of Hekla Aurora aircraftProduct launchBackground
The airline sought to express Icelandic identity through distinctive aircraft design and onboard experience.
Action taken
It introduced a Boeing 757-200 decorated with an aurora-inspired winter scene and LED cabin lighting.
Aftermath
The aircraft became a prominent branded expression of Icelandair's destination-oriented marketing.
2010
Crisis response to volcanic ash disruptionOtherBackground
The Eyjafjallajökull eruption caused widespread European airspace closures during the important summer travel period.
Action taken
The airline maintained flights where possible, kept Keflavík operating for as long as conditions allowed, and temporarily shifted staff and operations to Glasgow when necessary.
Aftermath
Icelandair resumed and redirected services as airspace reopened and contributed to the subsequent tourism-recovery campaign.
2001
Move the international hub to KeflavíkStrategyBackground
The airline's growing emphasis on North American and European flying required an airport better suited to larger international aircraft and connecting operations.
Action taken
Icelandair transferred its principal international hub from Reykjavík Airport to Keflavík International Airport.
Aftermath
Keflavík became the central platform for the airline's Atlantic Bridge network, while Reykjavík retained importance for domestic aviation.
Recent events
Reported
Icelandair introduces new aircraft livery[3]
Icelandair introduced a new aircraft livery as part of a broader brand refresh. The article says the first aircraft had the new livery and describes plans to repaint additional aircraft.
Reported
JetBlue and Icelandair expand codeshare partnership[4]
JetBlue and Icelandair announced an expansion of their codeshare partnership, adding JetBlue codes to seven Icelandair European routes from Reykjavik; the routes were available for booking.
- Unconfirmed
Reported
AWAL and Icelandair partner to support Iceland Airwaves showcase[5]
AWAL and Icelandair entered into a partnership to support a showcase of Icelandic, Nordic and UK artists at the Iceland Airwaves festival. The partnership includes a showcase and artists taking over Icelandair's Instagram during the festival.
Reported
Icelandair announces Portland–Reykjavik seasonal service[6]
Icelandair announced that it would begin seasonal nonstop service between Portland, Oregon and Reykjavik, Iceland, from May 20 through October 21, 2015.
- Unconfirmed
Reported
Icelandair introduces a new fare structure[7]
Icelandair introduced a fare structure with five fare categories and the option to book one-way flights. The new structure was to be adopted in every country the airline serves.
Sources7 sources
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