What’s Happened To Icelandair’s 787 Order?

Icelandair is known for being an all-Boeing airline with 737 MAX, 757, and 767s in the carrier’s fleet. However, in the mid-2000s, Icelandair placed an order for Boeing 787 Dreamliners and later increased that order before abandoning its plans.

Icelandair impression
A rendering of a Boeing 787 Dreamliner in Icelandair’s livery. Photo: Boeing

The history of Icelandair’s 787 order

Back in February 2005, Icelandair placed an order with Boeing for the 787 Dreamliner. The airline initially ordered two 787-8s. In 2006, Icelandair grew that order by exercising purchase rights for two more 787-8s.

There were plenty of options for the Boeing 787 Dreamliner. Hannes Smarason, chairman of the Flugleidir Icelandair Group, stated the following when ordering the Dreamliner: 

“The 787 Dreamliner’s unprecedented efficiency, economics, range and passenger comfort are ideally suited for our operations and our commitment to providing superior service to our passengers.”

boeing 787 dreamliner getty images
Icelandair had planned on being a 787 operator but ended up abandoning that idea. Photo: Getty Images

The Boeing press release for the order went further and stated that Icelandair would use the 787 to expand its transfer traffic through Iceland by opening new markets in North America and elsewhere. At the time of the first order, the 787 entry into service was targeted for 2010.

In fact, the manufacturer didn’t deliver its first B787 until a year later in 2011. It seems like Icelandair had lost interest in the B787. The airline sold off orders for three of the planes to Norwegian, and Boeing no longer lists Icelandair as a 787 customer.

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Icelandair has not given up entirely on Boeing

In 2012, Icelandair announced a commitment for 12 737 MAX aircraft. A year later, Icelandair expanded its MAX order to 16 aircraft, including both the MAX 8 and the MAX 9. Icelandair had ordered nine 737 MAX 8s and seven 737 MAX 9s. But, in 2020, Icelandair slashed that commitment by four aircraft.

Icelandair MAX
Icelandair has orders for both the MAX 8 and the MAX 9. Photo: Boeing

Icelandair also operates a fleet comprised of four Boeing 767-300ERs, 15 passenger 757-200s, and two 757-300s. All of these aircraft need to be replaced soon.

Will Icelandair order the 787s in the future?

Icelandair has shown an interest in the past in potentially moving over to Airbus for an aircraft order. As recent as February, Icelandair considered ordering Airbus A321neos amid the uncertainty over the global grounding of the 737 MAXs.

One of Icelandair’s main problems are the 757s and 767s. Even though the carrier has six MAX aircraft on order, it has over 20 aircraft that would need to be replaced unless it trims its route network– which is not necessarily an impossibility– but would be a massive blow to the number of passengers coming to and from Iceland.

Icelandair 757
The 757s are the backbone of Icelandair’s fleet. Photo: Getty Images

Thinking ahead, however, to a post-crisis Icelandair, then some issues start to prop up. The 767-300ERs and 757s will reach the end of their profitable lifespans as those jets will all be about 25 years or older at that time. Some of them now are pushing 30 years old, hence a few retirements.

But, in a post-crisis world, Icelandair would be left without a suitable replacement for its 767-300ERs. While the airline could turn to Boeing 737 MAX 10s for fleet harmony to replace its 757s, the 767s simply cannot be replaced by a 737 MAX.

Icelandair, Boeing 767, Heart Flight Path
Considering the 767-300ERs, Icelandair has no suitable replacement on order. Photo: Getty Images

One option could be Boeing’s NMA or “797,” but that plane has not been greenlit yet, and it could be a while before Icelandair would receive them and start a fleet renewal plan.

All of this boils down to room for a 787 order. After souring at first, perhaps due to delivery delays, a 787-8 could be the way to go for Icelandair to replace its four 767-300ERs. Whether the airline ever opts for the type in the future, however, remains to be seen. It is not an impossibility, but certainly, one that is improbable, at least over the next couple of years.

About Icelandair

Icelandair is the flag carrier of Iceland, with the airline being in operation since 1937. The airline has a fleet of 35, with 14 aircraft on order. While Icelandair has worked to bring people to and from the island country, its main model is to carry passengers from the US to Europe and vice versa via a stop in Iceland. The airline also offers passengers the option to spend a few days in Iceland and augment their journey with a new experience. 

Do you think Icelandair should have kept its 787 order? Do you believe Icelandair will place an order for the 787 again? Let us know in the comments!