"Running an Icelandic airline is not a given"

Icelandair’s revenue roughly doubled year-over-year. This year, the company will have an average of nearly 3,700 employees for the year, with over the peak period, about 5,000 employees working for the company.

The emphasis has been on increased utilization of the Saga Class cabin, and this year is looking at the largest flight schedule in Icelandair’s history.

This was stated at the airline’s annual general meeting, held yesterday.

Strong brand given the size of the company

Bogi Nils Bogasson, the CEO of Icelandair stated in a speech at the meeting that 2022 had been a very transformative year for the company’s operations.

“Running an Icelandic airline with headquarters in Iceland is not, however, a given. Although we at Icelandair constantly consider costs and how to minimize them, we are fully aware that an airline in Iceland can never be the world’s leader in international markets in terms of costs.

For that, we are far too small and have an operating environment characterized by high costs. We must therefore win the game on the revenue side, and there we have built a very strong infrastructure and a unique position in the last decades that are truly taking off now.”

Bogason gives us a few examples of how the company has built strong infrastructure and uniqueness in the last decades. Among other things, the company has built the right product that fits the environment in which the company operates. The company’s good service and customer satisfaction was highly emphasised and that the Icelandair brand was incredibly strong considering the size of the company and Iceland.

Iceland’s biggest interest

In his speech, Icelandair chairman Guðmundur Hafsteinsson, said that good operating conditions are a prerequisite for a sustainable future and to protect the vital benefits of aviation and tourism. The business environment needs to be considered both domestically and internationally.

Guðmundur also mentioned the proposed legislation of the European Union, which includes an emissions tax on air travel and an aircraft fuel addition requirement. He said that this legislation would result in additional costs that would be heavier on Iceland’s airlines than other countries. This would significantly reduce Iceland’s airlines’ competitive position in relation to foreign competition, as well as Iceland’s position as a hub in aviation. Flights to, from and around Iceland would therefore simply move elsewhere, where costs would not be as burdensome.

“If this is achieved, the impact would be enormous, not only for Icelandair and Icelandic tourism, but for the entire Icelandic economy – fish exports and other trade – as well as the quality of life of the local public.”