Reykjavik's Keflavik Airport and Icelandair are booming but the future is not so clear

Once regarded as a minnow amongst the big Scandinavian and Nordic airports, Iceland's Keflavik Airport has been expanding, and continues to do so at a very fast rate. It is still a minnow relatively speaking - Stockholm Arlanda, Copenhagen and Oslo Gardermoen airports all handle in the region of 25 million passengers each year or more, while Helsinki Vantaa Airport handles around 16 million. Compared to this, Keflavik Airport's 3.9 million passengers in 2014 is small fry indeed in the land of the codfish. But its growth rate of over 20% was more than three times greater than the average rate recorded by those four peer airports. Moreover, Keflavik's monthly passenger growth so far this year (Jan-2015 to Oct-2015) averages almost 26%.

This report looks at what is causing that growth, which airlines are driving it (focusing on flag carrier Icelandair), and how the airport authority is going about catering for it. It also throws some light on what has made Iceland one of the fastest growing tourist - and transit - destinations and how that remains a conundrum for both Keflavik Airport and Icelandair.