Icelandair, Iceland's national carrier is quite a unique airline in terms of business model. The carrier operates a hybrid business model mainly focusing on intercepting demand for cheap flights between the US and Europe with a rapid stopover in Reykjavik Keflavik international airport. Operating quite a large number of destinations with not all that much demand on every single route meant that the choice of operating narrow body planes was a no-brainer. This was possible thanks to Iceland's ideal half-way position between Europe and the US meaning that narrow body planes have the required range. So far the Icelandic carrier has only been using Boeing produced planes having used the 757 and 767 in the past and relying exclusively on the 737 MAX in more recent years. This Boeing monopoly has, however, come to an end. Icelandair has received its first ever Airbus A321neo.
Icelandair Gets on The Airbus Wagon – Its First A321neo Lands in Reykjavik
The Airbus A321neo has become by far and large the most successful airliner in the world in the past decade or so. The jet particularly in its LR and XLR versions unlock some serious untapped potential for many airlines looking to operate thin and long routes. In that pool of airlines is Icelandair which bases its entire business model on this type of flight.
The airline's business model is the perfect match for the capabilities of the A321neo even more than the Boeing 737 MAX which Icelandair has relied on exclusively for the past few years.
With the A321neo in its fleet it is very likely that the longest routes currently operated by the Boeing 737 MAXs will be handed over to the new Airbus planes as they just have better economics on longer routes. The first of the Icelandair Airbus A321neo planes has registration number TF-IAA and it is only the first of a long list of the type poised to join the airline's fleet.
Specifically four Airbus A321LR will be dry leased from SMBC Aviation Capital, while a further 13 will be purchased and received directly from Airbus itself.
All the new A321neo will be powered by the Pratt&Whitney GTF engines. The same GTF engines that have wreaked havoc with their many components issues in the past few years. Issues that have, however, been solved on the newly produced units.
With one aircraft type joining the fleet, another prepares to exit. The Boeing 767s and 757s which overlap in many aspects with the A321neo will be soon a thing of the past for Icelandair and its fleet.

The New A321LR Cabin Configuration – Optimized For Medium US Europe Operations
Icelandair with its hybrid model is very cautious to never refer to its premium cabin as business class. The airline calls it Saga Class which distinguishes it from the main cabin but doesn't come with the high expectations of a proper business class. I had to make that clear as in the cabin layout below I will be referring to Saga and not Business Class.
These new Airbus A321neo LR and the future XLRs Icelandair will receive will all operate in a 2 class setup, featuring:
- 22 Saga class seats in a 2-2 layout
- 165 economy class seats in a 3-3 layout
Each seat comes with its very own in-flight entertainment screen on each seat-back. A nice touch considering that not all low-cost or quasi-low-cost airlines offer such an amenity.

