American Is Adding Flights Between Dallas & Iceland In 2018

I didn’t really see this one coming! While Icelandair and WOW Air have been adding flights to the US like crazy, up until recently Delta has been the only North American airline offering service to Iceland. That has changed recently:

Well, it looks like American is joining in now as well, and I’m a bit surprised by the hub they selected for the service. In the summer of 2018, American is adding seasonal flights between Dallas and Iceland. The flight will operate daily between June 7 and October 26, 2018, with the following schedule:

Dallas to Keflavik departing 8:20PM arriving 9:15AM (+1 day)
Keflavik to Dallas departing 11:10AM arriving 2:50PM

The flight will cover a distance of ~3,740 miles in each direction, and will be operated by a Boeing 757-200, featuring 176 seats, including fully flat seats in business class. Tickets for this new flight will go on sale as of Monday, November 20, 2017.

I’m a bit surprised to see the airport out of which American is operating the flight, as I almost certainly expected that any flight to Iceland would be out of Philadelphia, where they can capture connecting passengers efficiently from every part of the US. By flying out of Dallas they’re excluding passengers originating on the east coast.

I suspect American’s motivation for choosing Dallas is that both Icelandair and WOW Air have recently announced that they’ll fly to Dallas, so this is American’s defensive response. However, I’m not sure how logical that is. A majority of Icelandair and WOW Air passengers aren’t actually traveling between North American gateways and Iceland, but rather are using Iceland as a connecting point to the rest of Europe.

So the way I see it, the bigger threat against American with these new flights to Dallas is for traffic between Dallas and mainland Europe, rather than traffic between Dallas and Iceland.

This will be American’s first transatlantic market that they serve out of Dallas but not out of Philadelphia. Ultimately I do think there’s some market for US airlines to fly to Iceland, at least seasonally. While it probably isn’t terribly high yield, there are premium passengers who would prefer a flat bed to Iceland, given that WOW Air doesn’t offer a business class, and Icelandair’s business class is more like domestic first class.

Iceland is an incredible country, and I’m happy to see American fly there.

What do you make of American adding flights between Dallas and Iceland?

(Tip of the hat to @jolesch)

Comments

  1. “This will be American’s first transatlantic market that they serve out of Dallas” – I think you’re mistaken here, Lucky. AA serves Frankfurt, Madrid, London from DFW. Maybe I am not understanding what you’re saying here.

  2. @Tom Schneider – there’s more to that sentence: “This will be American’s first transatlantic market that they serve out of Dallas but not out of Philadelphia.” You’re right they serve other TATL markets but those markets are also served out of Philly while Iceland is not.

  3. @Tom Schneider you left out the rest of the sentence “but not out of Philadelphia.” Meaning it’s the only flight from Dallas that they don’t also fly out of PHL (AA flies to Frankfurt, Madrid, London, etc from PHL too)

  4. This is a strategic move meant to protect AA’s yields to Europe (London, Frankfurt, Paris) in the long term. They’re doing this by diluting yields on the traffic to Iceland. While the majority of the traffic on Iceland/Wow is connecting to Europe, they charge higher fares for the local traffic to/from Iceland. That’s where Icelandair/Wow Air make their money – on the tourist traffic just going to / from Iceland. Adding more seats to just the Iceland market will dilute the fares, endangering Icelandair’s / Wow air’s overall flight. With yields depressed, one of them will drop out. Or maybe both! Then AA will retreat as well, and AA’s yields to Europe will be restored. Classic strategy to hurt competitors, with a twist in this new day and age

  5. There are way too many flights and people going to Iceland these days. Reykjavik is a small city and it doesn’t have the infrastructure to support hordes of tourists. The airport is overcrowded now and all of these extra flights will only make it worse.

    Cheap air fares helped to make Venice the mess that it is these days and I fear Reykjavik is heading in the same direction. I’m glad I went years ago when it was still a unique and quirky place off the beaten path.

  6. @Lea Thanks for the clarity. While I believe I speak and understand English well, it is not my first language. I simply understood it as – It’ll be the first Transatlantic market/route for but DFW while Philadelphia has many other. It’s my misunderstanding. Thanks again and as always great content, Lucky.

  7. “By flying out of Dallas they’re excluding passengers originating on the east coast.”

    They’re not excluding east coast passengers…they’ll just have to backtrack to DFW to get to Iceland on AA. I get your drift, but disagree with the logic.

    Either way, good for Iceland I guess!

  8. Would have thought Chicago was a better connecting point for most AA flyers, and a shorter flight as well

    Too bad it’s a 757. Admitted, IcelandAir uses them too, but Wow uses a A-330.

  9. As someone who lives near PHL, I’ll happily fly Icelandair direct rather than backtracking through DFW. (and get real miles with Alaska to boot!)

  10. They’re only doing this to try to push Icelandair/WOW out of the Dallas market. Having those carriers serve Dallas-Europe via Iceland depresses the high fares AA is able to charge for Dallas –
    Europe traffic. They really dont care if it’s accessible to East Coast AA customers, they’re just looking to saturate Dallas-iceland seats, which will lower fares at what they hope is an unsustainable level for their less well funded Icelandic rivals. Once one, or both, leaves the market, then they will too and increase their fares on Dallas-Europe. True, most of the pax on Dallas- Iceland will go on to Europe (in general, about half are just connecting), but it’s the local traffic (Dallas-Iceland) that makes the flying profitable. AA putting more seats into the market lowers the fares on the local traffic that Icelandair and WOW can charge, which will, AA hopes, threaten their viability. AA doesnt care where the traffic comes from nor if their flights are full – they just want to drive competition out of the market. If they really cared about the Iceland market, they’d probably do a utilization flight from Philadelphia or Chicago. This just shows that they’re willing to spend money to hurt a competitor. End of story.

  11. Agree with Jason’s thoughts but also the East Coast is absolutely saturated with flights to Iceland which makes Philadelphia less appealing for AA. There’s huge demand from Texas to Iceland and currently the itineraries to getting there from Austin, Dallas, and Houston are all sloppy or require multiple ticket bookings.

  12. Ben since this is an international AA flight, does this mean I can earn Alaska miles with AA should I choose to fly with them over Iceland Air on this route.

  13. I live in Tampa and would actually prefer to go through DFW vs PHL because I can actually get some sleep on the flight over. Northeast to Iceland flights are like domestic red eyes that basically equal missing a night’s sleep.

  14. @Mike, please point me to these cheap fares to Venice! And while it’s definitely busier than before the infrastructure has been upgraded and it’s not done yet. From Florida to Venice is never cheap unless you go out of Miami (which is far for me). Can’t wait for some real competition in TPA/RSW (eurowings picked up where Air Berlin Left there).

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