Why is Icelandair so cheap?

Discussion in 'General Discussion | Travel' started by disambiguous1, Feb 22, 2015.  |  Print Topic

  1. disambiguous1

    disambiguous1 Silver Member

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    I'm looking up airfares from the DC area to Europe in September, return in October. United, which I have a rewards card with and try to use when possible, starts their fares at about $1300 for one-way. Icelandair, on the other hand, is about $900 cheaper, with fares starting at $400! I get worried when things get too cheap, so I'm checking in here to see if the Milepoint denizens can tell me about any pitfalls.

    I was going to use a United standard award to get me there and pay for a flight back. The Icelandair fares are so cheap that paying for a round-trip would be cheaper than getting a one-way fare with United. In fact, with the extra costs that United tacks onto awards flights, it might be cheaper just to book Icelandic both ways. That's crazy.

    Any info/experiences welcome.
     
  2. Gargoyle
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    Gargoyle Milepoint Guide

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    My very first TATL trip was on the old Icelandic. They were the cheapest at the time, partly because they always had a stopover in Reykjavik. They would package in one to three nights in a hotel which, IIRC, was owned by the same company. I spent one night, explored the town, really enjoyed it, and even with that stopover it was still really cheap.
     
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  3. okrogius

    okrogius Silver Member

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    Possible thoughts:
    -Shorter flights means lower costs (less fuel spent carrying fuel for later flight parts)
    -Simpler fleet offers lower maintenance costs.
    -Less complex alliance and network probably lead to simpler route structure. Large airlines like UA tend to have both someone paying pennies and someone paying a fortune (one way flight, or perhaps without Saturday night stay). Similarly UA pricing can be a bit expensive far in advance. Iceland air tends to have less variance between fares and thus it's more about load factor than extracting a variable amount of money from every passenger.

    UA fares should go down closer to departure, it's just hard to say when they'll go down and by how much. (Also you shouldn't look at international one-way fares on UA, or any other legacy. They're typically far more expensive than a roundtrip fare. Market segregation to optimize revenue extracted from the corporate business traveler and all.)
     
    Last edited: Feb 23, 2015
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  4. traveltoomuch

    traveltoomuch Silver Member

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    Unlike most domestic fares, UA's transatlantic fares still seem to be much cheaper when purchased as round trips, so buying one-way will likely be unpleasant. I would try to avoid Standard awards. Those burn through miles so fast that I'd start to question the merits of using (and paying the fee for) a UA credit card. If the best you can get are standard awards, you might be better off with a fee-free cash back card, like the Fidelity FIA Amex.
     
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  5. GenevaFlyer
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    Back in the late 90's, I did a couple of trips with Icelandic. Their advantage is this excellent sorting hub in the middle of the ocean. They would get 10-12 flights coming in from Europe, shuffle passengers, and send out 10-12 flights to the US and Canada. If you were lucky, you actually got back on the exact same plane as you had just flown in on.

    Plus, IIRC, they were already charging for beer and wine back then.

    Cheers,

    GenevaFlyer
     
  6. YULtide

    YULtide Gold Member

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    I haven't flown them, but I have checked out their product recently and they charge for meals in economy class. Not that United's meal service is worth $900. :eek:
     
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  7. Wandering Aramean
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    Wandering Aramean Gold Member

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    This is about the most expensive way to book a trip to Europe.

    Icelandair is fine, but not particularly special. Relatively tight space (similar to E- on UA) and the short TATL flights via KEF mean less sleep on the way over. But it is a fine airline operationally and quite likely to simply get you there and back without issues.
     
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  8. disambiguous1

    disambiguous1 Silver Member

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    Wandering Aramean-- Yeah, the standard award fares are high, but one is forced to use them if all of the saver award space is used up on all the available flights around the time one needs to use them.

    I plan to be tooling around the continent and I don't really care where I land in Europe or where my return flight comes back from, within certain general parameters. I'm trying to decide if I want to use trains and cheap airline flights once I'm over there, or rent a car. Since it's the shoulder season I'll probably start north and head south.
     
  9. Wandering Aramean
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    Wandering Aramean Gold Member

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    Given that you do not care where you land in Europe and that you're willing to fly in Y and that you're going in shoulder season I'm betting that you could get the whole thing in saver. Or just buy a round trip ticket for less money and save the miles for the next trip.

    Without trying too hard I found Y saver seats from IAD to FRA/CPH/VIE/GVA/IST/LHR/ZRH on 16 September. If that's not your desired travel date give me another one and I'll see what I can see. But I'm willing to bet that you can do this at saver levels without trying too hard.

    I would also pick at least 3 of the cities you want to visit as part of planning the award. You could, in theory, book it as IAD-CPH//CPH-TXL//IST-IAD. And then you're on your own for the TXL-IST part. Or something like IAD-CPH//FCO-IST//IST-IAD where you'd go by train, plane or otherwise from CPH to FCO on your own then get a "free" flight FCO-IST and be able to spend time in Istanbul before returning IST-IAD.

    All subject to finding the inventory, of course, but I'm betting it can be done if you give some specific dates and desires.
     
    Last edited: Feb 23, 2015
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  10. edekba

    edekba Gold Member

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    I have a trip to KEF in 3weeks and checked my ticket/website again... I was surprised that I'll probably need to buy a sandwich on the way there and back. Maybe its a nordic thing; as Norwegian you need to buy food on board as well... but at least they have have 787s (if they arent broke) vs 757
     
  11. iolaire
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    iolaire Gold Member

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    I enjoyed our Business "Saga" class flight IAD - AMS - https://milepoint.com/forums/threads/iceland-air-saga-business-class-iad-kef-ams-august-2012.44689/. Their Amenity Kit contains good natural moisturizers and the like, my favorite lotions from all the airlines I've flown, CX, SQ, AF, QR etc... and I continue to use their kit bag for my toiletry bag when I travel. If you fly business or premium economy you get lounge access and food/drink. When we flew they used the Air France lounge at IAD. At times the business or business or premium economy seats are lower cost than coach on other airlines or a very small premium in cost. Also look for buy up opportunities to premium economy.
     
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  12. Wandering Aramean
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    Wandering Aramean Gold Member

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    Keep in mind that the Business product is a step below the legacy carriers in terms of seat comfort. Plus it is a much shorter flight to KEF from the USA. Net result is less of a chance to sleep which is mostly why people seem to pay for business class on TATLs eastbound.
     
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  13. 365RoadWarrior

    365RoadWarrior Silver Member

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    The other factor behind Icelandair pricing is the desire to get people to go to Iceland, whether for a night, or for two weeks (as I did, many years ago). It's the flag carrier for a country that isn't "on the beaten path". And, it's a country that was devastated by the 2008 financial crisis.
     
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  14. TravelBear

    TravelBear Gold Member

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    This is very true. I noticed that even layovers tend to be long enough so you can take advantage of going to the Blue Lagoon for a quick soak. I have even seen it advertised as such. People often ask me how I ended up choosing to go to Iceland a couple of years ago and I can truly say I think it had to do with the country's aggressive marketing at the time. Everywhere I looked I was seeing an article or blurb about Iceland. It worked. And I don't regret it at all, cool place!
     
  15. MSPeconomist
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    MSPeconomist Gold Member

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    One suspects that Icelandic might get subsidized landing fees at KEF....or very subsidized costs for their layover package offers.

    They don't face the expense of maintaining a huge global network or a significant FF program (or major partnerships or alliance commitments). In these ways, it's similar to a budget carrier but with business class, some interlining, etc.

    TO THE OP: Please be very careful before committing to using miles in one direction TATL and purchasing a one way ticket in the opposite direction. Long haul international one way coach fares can cost more than double the price of a RT. You waste your miles withoout saving any money.
     
  16. mattsteg
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    mattsteg Gold Member

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    as others have mentioned, this course of action means you pay too much in miles, and also in coach. one way tatl fares are typically very high.

    You talk about icelandair being so cheap you'd consider paying both ways....price out round trips rather than 1-ways and see how everything prices out, includibg on united of anyone else.

    And you're never *forced* to use miles. Use them when they make sense (and almoat surely given your flexibikity here you can get saver both ways)
     
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  17. iolaire
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    iolaire Gold Member

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    Like making people pay for food and booze in coach...

    It should also be noted that the good planes are from the US to Iceland and the planes from Iceland to Europe are older - at least circa our flight in 2010. The business class is non flat seats and even more so non flat seats on the Europe sections.
     
  18. HaveMilesWillTravel
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    HaveMilesWillTravel Gold Member

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    Well, the other carrier in this comparison, United, charges for booze in coach across the big pond, too :)

    Who is "one" ?
     
  19. eponymous_coward
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    eponymous_coward Gold Member

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    If I'm saving a couple hundred on the flight, I'll live with paying $15 for a beer and a meal. It would buy me MUCH better food and drink on the ground.

    My friends (not particularly frequent fliers, but they fly some) didn't mind flying FI at all to KEF. Of course they've never done the Krug and caviar thing in hyper-premium F, so they don't know what they're missing, but for most airlines Y is Y... it is what it is, not glamorous, at best functional, at worst cramped and miserable and meant to be tolerated until you get to your destination.
     
  20. iolaire
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    iolaire Gold Member

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    See I've managed to not fly a US carrier coach across the pond for a quite a few years so I forget about that! I think all international flights are like AF where you get a tiny menu, drinks and a roll in coach...
     
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  21. HaveMilesWillTravel
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    HaveMilesWillTravel Gold Member

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    It's hard to put a price on coach airline food served by United (I have no recent experience with their US-based competitors, but I assume the difference is negligible). Maybe 50 cents? I suspect the cost divides equally between packaging and content. (of course, I am excluding the human labor to serve it and the fuel to fly it around, but that would be the same whether I get charged for it or not).
     
  22. HaveMilesWillTravel
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    HaveMilesWillTravel Gold Member

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    On United the tiny menu would have three words.

    Chicken

    or

    Pasta
     
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  23. milchap
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    milchap Gold Member

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    Air Canada also provides drinks and a meal in economy TATL
     
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  24. WilliamQ

    WilliamQ Gold Member

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    Delta provides meals and alcoholic beverages in Y when flying international too.
     
  25. eponymous_coward
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    eponymous_coward Gold Member

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    LH gives you Warsteiner. And hot cabins and 30" pinch, er, I mean, pitch.
     
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