For the first time ever, Icelandair has placed an aircraft order with Airbus.
In this post:
Icelandair’s Airbus aircraft order
Icelandair and Airbus have signed a Memorandum of Understanding for an order of up 25 Airbus A321XLRs. This includes 13 firm orders, plus 12 options. The catch is that deliveries will only start in 2029, so this order is still quite a ways off.
Icelandair has plans to add Airbus aircraft to its fleet sooner, as the airline is in advanced negotiations to lease four Airbus A321LRs, and start flying them in 2025.
For context, the Airbus A320neo family is a competitor to Boeing’s 737 MAX product. The Airbus A321 is the largest variant of that family of aircraft, and we’re seeing some impressive incremental performance for new variants of the aircraft. The A321XLR has the range to fly up to 4,700 nautical miles (8,700km), while the A321LR has the range to fly up to 4,000 nautical miles (7,400km).
These aircraft will not only allow Icelandair to operate all of its current route network, but will also allow the airline to enter new markets. Icelandair states that all these aircraft will have around 190 seats.
Here’s how Icelandair’s CEO, Bogi Nils Bogason, describes this order:
“We are happy to announce that we have now reached a conclusion regarding Icelandair’s future fleet. We have decided that the capable and fuel-efficient Airbus aircraft, A321XLR and A321LR, will become the successors of the Boeing 757 we are gradually retiring. The Boeing 757 has been the cornerstone of Icelandair’s operations since 1990. Its unique capabilities have underpinned the successful development of our extensive route network and competitive transatlantic hub by leveraging Iceland’s unique geographical location to connect North America and Europe via Iceland. The excellent Airbus aircraft will not only allow us to further develop our proven business model around transatlantic flights but also open opportunities for future growth by entering new and exciting markets.”
What this means for Icelandair’s future fleet
For context on Icelandair’s fleet, the airline has 38 jets, which operate its network to North America and Europe. This includes:
- 16 Boeing 737 MAXs, including 12 737 MAX 8s and four 737 MAX 9s; there are four additional 737 MAX 8s on order
- 19 Boeing 757s, including 17 757-200s and two 757-300s
- Three Boeing 767-300ERs
With the acquisition of Airbus aircraft, Icelandair plans to completely replace its Boeing 757 fleet. At some point in the future we can expect that the airline will exclusively fly Boeing 737 MAXs and Airbus A321XLRs.
My take on Icelandair’s order with Airbus
Icelandair has had an all-Boeing jet fleet for decades, so it’s interesting to see the airline finally placing an aircraft order with Airbus. On the one hand, there would have been efficiency from eventually having an all-Boeing 737 MAX fleet, but this also highlights how Boeing can’t compete with Airbus in the long range narrow body market.
For example, Icelandair used to fly from Reykjavik (KEF) to San Francisco (SFO), which covers a distance of 3,653 nautical miles. This was discontinued around the start of the pandemic, and probably hasn’t been operated due to lack of enough aircraft able to operate this service. That’s a route that’s well within range for the A321XLR (by a large margin), while it’s not a mission the 737 MAX could operate. The 737 MAX 8 has a range of 3,550 nautical miles.
For some airlines, the range difference between variants of the 737 MAX and A321neo might not matter, while for Icelandair it makes a big difference.
I had one other thought when I saw this order. Icelandair has been very consistent when it comes to its premium seating option, as Icelandair’s Saga Class (business class) most closely resembles domestic first class within the United States, and doesn’t have flat beds.
Given the range of the A321XLR, I can’t help but wonder if the airline might finally install flat beds on these planes, as they’ll operate some longer routes. It sure would be nice, though in terms of Icelandair’s business model (low pricing and consistency), I think it’s unlikely. Icelandair also suggests these planes will have around 190 seats, which represents a pretty dense configuration that doesn’t leave much room for flat beds.
With these planes only being delivered in 2029, admittedly we could see a strategy shift between now and then.
Bottom line
Icelandair plans to acquire Airbus jets for the first time. The airline is ordering up to 25 A321XLRs, due to be delivered starting in 2029. The airline also plans to acquire four A321LRs that will join the carrier’s fleet in 2025.
It’s pretty interesting to see Icelandair place a non-Boeing order for the first time in decades. However, the reality is that there’s only one modern narrow body jet that can operate Icelandair’s entire route network, and it’s not the 737 MAX.
What do you make of Icelandair’s Airbus aircraft order?
This is not shocking to me. Kudos to Icelandair for identifying their aircraft needs and selecting the only product available to them to replace their ~40 year workhorse. Clearly this is another missed opportunity by Boeing to create a viable middle of the market product that it had in the B757. Airbus is DESTROYING Boeing in this segment. I do not pretend to be an aeronautical engineer but how difficult would it be to reconfigure/redesign/resurrect...
This is not shocking to me. Kudos to Icelandair for identifying their aircraft needs and selecting the only product available to them to replace their ~40 year workhorse. Clearly this is another missed opportunity by Boeing to create a viable middle of the market product that it had in the B757. Airbus is DESTROYING Boeing in this segment. I do not pretend to be an aeronautical engineer but how difficult would it be to reconfigure/redesign/resurrect the B757 and throw the “MAX” 8 or 9 moniker on it?
Brilliant News for Icelandair & Airbus.
Why Oh Why Won’t Boeing build their Mid-Sized New Aircraft?
As long as they don't offer a lie flat business class, they are simply no option for an overnight flight, i.e. to/from North America.
Disagree - flying them next week in Saga Premium. Agree if you are planning to fly overnight to Iceland then connect it would be tough but they allow free stop overs in Iceland so staying 2 days there on the way to Denmark and 1 night on the way back. Less than 6 hours from IAD (flew from JFK last time which is even less) so, IMHO, no need for lay flat seats. Are you...
Disagree - flying them next week in Saga Premium. Agree if you are planning to fly overnight to Iceland then connect it would be tough but they allow free stop overs in Iceland so staying 2 days there on the way to Denmark and 1 night on the way back. Less than 6 hours from IAD (flew from JFK last time which is even less) so, IMHO, no need for lay flat seats. Are you really using that for the 3 hours or so after the meal service you could actually get some sleep? Flight from KEF-CPH is only 3 hours and during the day so no problem with the seats. Coming back you fly during the day.
Don't get me wrong I have flown J on a number of carriers to Europe and Asia with lay flat seats and those were fine. If Europe is your final destination may make a difference but the relatively short hop (6 hours or less is similar to JFK-LAX) to KEF doesn't warrant it at least for me.
Looking at the options opened by the 4500nm range of the XLR, I'm curious whether Icelandair could eventually fly to Asia. Certainly destinations like Dubai or Doha (codeshared with QR ;)) would be unique but more optimistically, once Chinese demand returns in full swing, could we see KEF-PEK?
You should add a radius map showing the new possible destinations.
Will be interesting to see how the economics of these longer haul narrow body flights work. United could likely fill a 787 decently well from SFO at some point with a good amount of premium demand vs Icelandair with no premium seats
http://www.gcmap.com/mapui?R=4500nm%40KEF&PM=b%3Adisc7%2B%25t&MS=wls&DU=nm&DM=4500
Icelandair is the perfect customer for the XLR which is basically a flying gas can that can hold a few pax and suitcases. Given their business model, they really don’t need cargo capacity and LCC pax can hardly complain about a narrow body when they’re paying $400 for west coast to Europe…
As their business business model calls for flying fresh Icelandic fish daily on all their various routes, they will indeed need cargo capacity.
I am just amazed about the delivery window for the A321XLR. This is 6 years away. ARBUS order books must be bursting. And more customers are plabbibg to order, take INDIGO, the rumor has ir rhat they plan for a 500 planes order. No surprise that sopply chains are streyched beyond capacty.
The 737 is the aviation equivalent of Joan Rivers at this point.
How many more times can Boeing stretch and yank and rewire something so old? Have they forgotten the fact that they employ hundreds of engineers who could design a new plane?
This is what happens when bean-counters run an aircraft company. Cheapness wins out over innovation every time.
One more nip-tuck to the 737 and Howard Stern will be delivering its eulogy.
"Boeing can’t compete with Airbus in the long range narrow body market"
and has de facto surrendered that particular middle of the market segment.
This is showing up the massive mistake made openly last year by Boeing, when the CEO said that the 797 was cancelled, and there would be no direct replacements for either the 757 or 767 this decade.
As much as I really loved Boeing in the past, they deserve to be losing their once most loyal customers such as Icelandair and Qantas, as they are refusing to even attempt to make the mid market...
This is showing up the massive mistake made openly last year by Boeing, when the CEO said that the 797 was cancelled, and there would be no direct replacements for either the 757 or 767 this decade.
As much as I really loved Boeing in the past, they deserve to be losing their once most loyal customers such as Icelandair and Qantas, as they are refusing to even attempt to make the mid market planes that are needed for modern and near future travel patterns. It is all well and good focusing on the 737 range or large widebodes 787 and 777x, but much more choice of civilian aircraft is needed now not in 2043.
Great point. Sad to see them completely blow a market they invented - the 757 - to the XLR and have literally zero response, nothing that comes even close.
My guess is they're probably refining the 737 internally, and will figure out a way to boost its range within a few years, but doubt it can match XLR - the 10 is at 3300 nmi, 321XLR is 4500, that's just too much of a difference. Plus, one gotta wonder how much more can you squeeze out of a 737 frame.
Icelandair does not fly to Los Angeles. Perhaps they will in the future. But not now. The way you wrote that sentence makes it seem like they currently do. They do not.
@ Jason -- Sorry, not sure what I was thinking there. Post updated. :-)
No problem! I hope they do!