Annual and Sustainability Report 2022
Air freight and logistics

Air freight and logistics – New Icelandair Cargo

Icelandair’s airfreight and logistics operation’s focus has been on air freight services to and from Iceland, by leveraging the passenger route network together with scheduled air freighter flights, operating designated cargo aircraft. In 2022 a strategic decision was made to expand the cargo operation and build up a cargo hub in Keflavik, similar to the passenger hub. The company has added two B767-300 freighters to the fleet, one already in operation since December and the second one to be added in April 2023.


Demand back to normal

Icelandair Cargo performed well in the year 2022. Generally, one of the main emphases when planning the cargo schedule and operation is to maximize the utilization of the belly capacity available in the Icelandair passenger network. Belly capacity was particularly limited in the first months of the year but improved with more frequent passenger flights.

Global demand for air freight was at a maximum at the height of the pandemic but has decreased back to normal. There is however still some uncertainty in Europe which is mainly caused by the war in Ukraine and increased inflation in key markets, that affects demand for import and export.

Freight carried, measured in freight ton kilometers (FTK) decreased year-on-year by 7%. The main reasons are the aforementioned, limited belly capacity and softer demand for exports compared to 2021.

Icelandair’s main markets for air freight are in Central Europe. As before, perishables, spare parts, fashion goods, and e-commerce are a big part of the import operation. Pharma and medical transport have also been increasing, for example, vaccines and other medical equipment.

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With the New Icelandair Cargo Project we have the vision of extending our operation and building a hub for transit freight across the Atlantic. To make this vision a reality we have added two wide body aircraft to the fleet and expanded our warehouse at Keflavik Airport. In 2023, we will connect Liege, Europe with three destinations in the US, New York, Chicago and Los Angeles, via Iceland. The added cargo capacity will create great opportunities and open new markets for importers and exporters in Iceland. This is especially important for Icelandic seafood exporters and perishable importers as we will secure reliable freight capacity to markets in Central and West Coast USA additional to the East Coast.

Sigurgeir Már Halldórsson

Director Imports and Transit


Building on a successful business model

As part of the New Icelandair Cargo project, Icelandair’s cargo warehouse at Keflavik Airport has been redesigned and expanded. The expansion of the warehouse and the addition of two widebodies into the fleet is a part of the company’s vision of a cargo hub at Keflavik Airport, connecting important cargo hubs on both sides of the Atlantic. In 2023, the company will connect Liege, Europe with three destinations in the US, New York, Chicago and Los Angeles, via Iceland. The transit freight model is based on Icelandair’s successful business model of offering a vast network of passenger flights between continents via Iceland.

Icelandair Air Freight and Logistics has the future vision of increasing the ratio of transit freight to up to 50% of the total operation.