Tourism | Iceland

A History of aviation in Iceland

The history of aviation in Iceland, with paying special attention to the company Loftleidir

Last modified: 9 April 2024

This article tells a history of aviation in Iceland. Special attention is paid to the company Loftleidir and how it merged with Flugfélag Íslands to become the well-known company Icelandair.


The history of aviation in Iceland took wings at the beginning of the 20th century, when several pioneer pilots flew over Iceland in aerial reconnaissance flights. The aim of these flights was primarily to map the landscape and study Iceland's geography. The well-known polar expiditionary pilot Jean-Baptiste Auguste was among these pioneers, and they also helped to assess what it is like to fly in Iceland, where there are strange winds and rapidly changing weather conditions. Some other notable early pilots that flew over Iceland are Bernt Balchen, a famous arctic pilot, Lincoln Ellsworth, an American, and Elly Beinhorn, a female German pilot.


Introduction of commercial aviaton

In the early 1900s, a German Zeppelin called "Graf Zeppelin" traveled over Iceland. It was widely covered in the media and people were clearly stunned to see this new vehicle in the air. This inspiration may have sparked a fascination with flying – a passion that may have helped the development of air transport in Iceland. The late 1930s marked a period of transition in Iceland's aviation history with the introduction of commercial air services, mainly led by the Scandinavian Airlines System (SAS). This pioneering flight connected Iceland to major European cities, including Copenhagen and Stockholm, ushering in a new era of connectivity and accessibility for the island nation. Using a combination of seaplanes and land-based aircraft, these early commercial operations not only facilitated passenger travel, but also became important in the transportation of goods, strengthening trade and foreign relations with neighboring Scandinavian countries.

This image outlines the route that the Graf Zeppelin took over the polar region.


The effects of aviation

The introduction of commercial aviation was a catalyst for growing tourism in Iceland, attracting visitors from across Europe and beyond, eager to explore the island's unique landscape and cultural heritage. With the rise of commercial aviation, Iceland witnessed increased infrastructure development to support the growing demand for air travel. Airports underwent significant expansion and modernization to accommodate larger aircraft and increase passenger numbers. With the occupation of Iceland from 1943, the Allies built airports in, for example, Vatnsmýri and Keflavík Airport. Initially, it was made to transport military equipment, but since then it has been used by Icelanders when they started flying themselves. This infrastructure investment not only increased Iceland's connections with the rest of the world, but also laid the foundation for the subsequent development of the aviation industry.


The advent of commercial aviation not only changed Iceland's economy and society, but also highlighted the key role of aviation in shaping the country's international and cultural relations and laid the foundation for further progress in the coming decades. These first commercial flights were conducted with several types of aircraft, both land and seaplanes. These first commercial flights laid the foundation for growth and left a lasting impact on the nation's tourism and commerce. As Iceland became more accessible to foreign tourists, tourism increased. Because of the commercial flights, the number of visitors to the island increased, because these tourists wanted to witness Iceland's beauty and natural wonders. This influx of tourists not only strengthened and diversified the economy, but also helped put Iceland on the map as a great tourist destination. But apart from these international flights, the introduction of airplanes in Iceland also connected parts of Iceland together. Due to Iceland's mountainous landscape, different parts of the country were always somewhat landlocked from other parts of the island. Road cars were not that good in the early days. It wasn't until 1974 before the ring road came to Iceland. But the commercial flights helped to connect the country together and opened the possibility for people to move to another place and exchange goods within the country.


Infrastructure development

This domestic flight also initiated the establishment, expansion and modernization of airports. For example, the first Vestmannaeyja flights landed on the island without a runway. From these early beginnings, it is amazing how far some of the Icelandic airports have come. Now the country is more connected by road, so domestic flights are not as important as they were in the early days. But the airport in Keflavík has grown tremendously and is now a large hub that connects flights from North America to countries east of the Atlantic Ocean. This airport was built by American forces on March 23, 1943, and even then, Keflavík Airport was an important stopover for flights from the United States to Europe. Isavia even claims that "Keflavík Airport played an important role in the development of civil aviation between Europe and America" (, page 9). Just to describe the growth of Keflavík Airport: In 1958, Keflavík Airport had already grown considerably. During this time, about 44,000 passengers and 1,200 tons of goods passed through Keflavíkurfl



One very interesting company in the history of Icelandic aviation is Loftleiðir. This company was established in the year 1944 by three Icelanders that had learned to fly in Canada. At first, Loftleiðir operated only domestic flights. But in 1947 they took the first international flight from Reykjavík to Copenhagen. This first flight was flown on June 17th, which is of course National Day. This date highlights the importance of this flight and how it has political significance for Iceland, relates to relationships and is a symbol of gaining independence from Denmark. You have to understand that Iceland does not have a level road, international tunnels for freight cars and ships take a long time to sail here. Because of this, the flight was so incredibly important for communication between Iceland and other countries. After this flight to Denmark, things developed really fast for Loftleiðir. Already in 1948, the planes from Loftleiðir were granted permission to fly to the United States as Harry S. Truman accepted the "Civil Aeronatics Board" authorization for Loftleiðir. The first commercial flights from Iceland to the United States started soon after.



In Iceland, aviation has always been closely tied to politics. Because of Loftleiðir´s success on the international stage as well as its ability to connect Iceland domestically, the Icelandic government realized the political importance of aviation in Iceland. Guðni Þorðarson, the official representative of the airline Air Viking, even believed that the political ties with aviation were so intense, that he claimed that aircraft companies and the cargoship companies "ruled everything" during these early days of aviation.

In 1948, the Icelandic government received a loan from the United States. Instead of evenly distributing it to the two main airline companies, the Icelandic government solely gave a loan to Flugfélag Íslands, the main competitor of Loftleiðir.


Accidents and safety-related consolidations

Unfortunately, Flugfélag Íslands had a fatal accident in 1948. 23 passengers on board a Douglas C-47 Skytrain plane crashed into the sea off the Vestmannaeyjar during a flight from Reykjavík to Vestmannaeyjar.

This crash led to further investment in safety, but also led to the introduction of safety rules and procedures around aviation. This accident mitigation progressively improved. The government pushed for these safety measure, and, in many cases, put in place regulations that made aviation safer. But, even for the airlines themselves, safe airtravel was in their best interest as accidents damage reputation and (other) investments.

An example of the Douglas C-47 Skytrain Airplane, the type that was in an accident which opened the eyes of the Icelandic authorities regarding safety measures.

Further growth

A few years after the flight connection between the United States and Iceland was established, Loftleiðir began to grow as an airline that sponsored flights from the United States to Iceland.

It soon became its hallmark: In the 1960s and 1970s, Loftleiðir was known as a low-cost airline connecting Europe with the United States. It was during this time that the company even became known as "The Hippie Airline" for that reason. In the 1970s, Loftleðir teamed up with several other companies and private investors and founded the company Cargolux. This airline focused on freight transport instead of people (mainly Loftleiði's concern). The first CEO of this company, Einar Ólafsson, explained in the documentary how they established a freight connection between Hong Kong and Luxembourg. Cargolux was founded by mainly Icelanders and employed many Icelanders in its early years. We can even talk about a small colony of Icelanders in Luxembourg who were hired by this company. Nowadays, the company's ownership is mostly in foreign hands, and Icelandic influence is weak withini this company.

Loftleiðir created this company Cargolux because they saw a growing demand in international airfreight services.

They were able to use their operational knowledge, experience, name and momentum to launch this cargo line extremely well. Today, Cargolux is one of the largest air freight companies in the world. To me, this is a beautiful lesson in Economy: you see how knowledge, operational skills, management skills, integration, connections with politics and expertise increase success. One also sees such adoption or transmittance (sometimes theft) of proper ways of performing from one compnay to another in other examples within the economic history of aviation. For example, Southwest Airlines is the inspiration for Ryanair and other low-cost airlines. Their operational measures, which include minimizing costs inspired these low-cost airlines to copy Southwest Airlines´ business. Another example is from the 1970s, when the economic situation worsened and the main airlines in Iceland joined forces. The Icelandic government successfully convinced Loftleiðir and Flugfélag Íslands to form one company, first known as Flugleiðir and then from 1973 to the present day Icelandair. We have seen throughout Iceland's aviation history that it was actually quite common for airlines to do better or worse. Some examples of failed airlines are Air viking, Arnarflug and, recently, WOW. This year, 2024, we are celebrating Loftleiðir's 80th anniversary, and there is even an exhibition commemorating its history,



2023 busy at Kef Airport. Upplýsingar um starfsemi Isavia og flug á Íslandi. (n.d.).

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History: Private flight services. Private Flight Services | Loftleiðir Icelandic. (n.d.).

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Keflavík International Airport - Isavia. (n.d.). (2024b, March 8). Morgunblaðið - Loftleiðir fagna 80 árum.