Icelandair Group has decided to integrate the operations of both Icelandair (FI, Reykjavik Keflavik) and subsidiary Air Iceland Connect (Reykjavik Domestic), which operates scheduled domestic flights and services to Greenland.
All supporting functions, such as sales, marketing, operations, finance, human resources, and information technology will be integrated into Icelandair’s operations, the group said in a statement on March 31.
The Air Operator's Certificate (AOC) of Air Iceland Connect will remain separate, however, and its crew members will still be employed by that company.
The role of managing director Air Iceland Connect will be discontinued. Arni Gunnarsson, who had fulfilled that role, has instead been appointed managing director of another Icelandair Group subsidiary, the tour operator Iceland Travel, replacing Bjorn Viglundsson who had been in this position since June 2019.
Gunnarsson joined Air Iceland Connect in 1999 as sales and marketing manager, taking on the role of managing director in 2005.
Icelandair Group had already indicated in an update on March 23 that due to the Covid-19 outbreak Icelandair was operating 14% of its planned flight schedule and that capacity was expected to decline even further. Air Iceland Connect, it added, had also witnessed a significant impact on its operations.
The group has temporarily shifted 92% of its employees to part-time employment, 240 of its 4,715 employees have been laid off, and a 20% salary cut has been applied to the remaining full-time employees. Executive management will get a 25% pay cut, the CEO and board of directors a 30% pay cut.
Air Iceland Connect had been reducing its fleet from three Dash 8-200s and three Dash 8-400s to two of each type, a process Gunnarsson confirmed to ch-aviation in October 2019. It currently owns three -200s and two -400s, the ch-aviation fleets module shows.
