Summary
This report regards the cruise destination Ísafjörður in the Westfjords in Iceland. Ísafjörður is located on the Westfjords peninsula, in the northwest of Iceland, in the fjord Skutulsfjörður surrounded by steep mountains. The municipality of Ísafjörður is Ísafjarðarbær. It consists of five towns and villages, Ísafjörður being the largest town with around 2750 inhabitants.
In this area, the fishing industry has dominated the economy for centuries. However, the current situation is characterized by a contraction in the fishing sector, such as in fisheries and fish processing.
The tourism and service industry are growing rapidly and is today one of the main industries. Due to its location, transportation to Ísafjörður is challenging, especially during the winter months, as the town is remote and the roads in the Westfjords have not been developed at the same pace as in other parts of the country. Transportation costs are, therefore, high within and to other parts of the country. Ísafjörður has one operating airport that operates flights to and from Reykjavík.
According to the Icelandic Tourist Board, only 10% of international tourists that arrived via Keflavík airport in the year 2019 visited Westfjords, and only 14% of domestic tourists visited the peninsula that year. Land-based tourists are therefore not a substantial part of tourism in Ísafjörður, and cruise tourism is all the more important for the local tourism industry. Due to hard winters and road conditions, the majority of tourists visit Ísafjörður over the summer months, June, July, August. The destination thus deals with high fluctuations in seasonality.
Cruise ships began sailing to Ísafjörður around 1990 and in 1994 the first organized cruise excursions were established for cruise passengers by a local tour operator. Since 2014 the number of cruise tourists has risen steadily, with nearly 100 000 visitors in 2019, the year before the Covid-19 pandemic. The majority of cruise ship passengers are from Germany, North America or the United Kingdom. Most of the ships are small luxurious expedition cruise vessels with less than 500 passengers on board, and many are members of AECO. Both so-called expedition ships and larger, so-called overseas cruise ships come to Ísafjörður. It is interesting to note that practices on land regarding these two different types of cruise vessels do not differ in Ísafjörður. These types of cruise ships use the same port facilities, cruise passengers are offered the same cruise excursions on land and local tour operators work with both types of cruise lines the same way.
The cruise ships usually tour around the whole of Iceland, and Ísafjörður is only one of the stops around the country. Ísafjörður port is the third busiest cruise port after the two largest cruise ports in Iceland, Reykjavík and Akureyri ports. Ísafjörður is conveniently situated between these two major cruise destinations, which is one reason why cruise ships choose to do a stopover in Ísafjörður. The cruise ships spend on average 8-10 hours in port, arriving early morning and leaving in the afternoon. In 2020 and 2021 there were hardly any cruise calls to Ísafjörður due to the global pandemic, but the industry was quick to recover. In 2022 passenger numbers had nearly reached the same number as before the pandemic, with 85 000 passengers arriving, and 260 000 passengers expected in 2023 (Figure 2), which is a major increase.
Figure 3 The numnber of cruise calls and passengers in Ísafjörður from 2014-2022. Source: numbers from the Icelandic Tourist Board.
Ísafjörður port has four accessible piers for cruise ships, but ships can also drop their anchor at a designated anchorage area at the entrance point to the port when all piers are occupied. The port does not contain a terminal building for cruise passengers and transportation possibilities are limited, with no shuttle service or public transportation on site. The town is however easily accessible by foot, only 300 meters away from the cruise piers. Rental cars and taxis are available for passengers at the port area and excursion bus pickups are available at the port, only a few meters from where passengers disembark.
The tourist information office, which is run by the municipality, operates a booth at the port and welcomes and guides cruise guests that have chosen to walk around town independently, without tour operators’ involvement, where to
go, figure 4.
Each cruise guest receives a map of the area, figure 5. In town, cruise ship passengers can visit the old town, local shops, museums and cafés.
There are various options to choose from for cruise visitors while on land. Many cruise tourists join pre-booked cruise excursions, and the main local tour operator is West Tours. The majority of cruise excursion bookings from cruise lines are managed by two major tour agents in Iceland, that is Atlantik and Iceland travel, which collaborate with local tour operators and tourism businesses. The tour agents recruit a local staff member for every cruise season to make sure tours run smoothly. The tour agents and the major tour operators in Ísafjörður work closely together. There are also few independent tourism businesses that operate outside of the pre-booked excursions or guided walking tours without the cruise lines’ or tour agents’ involvement. Those businesses skip the middleman and avoid paying extra commission.
Local tour operators greet cruise passengers that have pre-booked an excursion, where to go, which group to follow or which bus to join. Many cruise passengers hop on a bus right after disembarking and are driven outside of the town to neighbouring towns or nature attractions. Others that join a guided tour without joining a pre-booked activity, join some of the local companies who advertise their tours at the disembarkation area, and leave as soon as enough tourists have joined their tour.
Key cruise stakeholders in Ísafjörður
| Tour agents | There are two major tour agents in Iceland, Atlantik and Iceland Travel, that manage pre-booked cruise excursions for the cruise lines. They serve as a middleman between cruise lines and local tour operators and tourism businesses. |
| Local tour operators | Manage and operate cruise excursions in Ísafjörður. The largest one is West tours. The majority of local businesses are shareholders. Some of them operate their own buses while other collaborate with the local bus company. |
| Local tourism businesses | The great majority of local tourism businesses are involved in cruise tourism in Ísafjörður since the majority of tourists are cruise tourists. |
| Port of Ísafjörður | The port services all cruise ships that arrive to Ísafjörður. Bookings mainly go through cruise agents that manage cruise bookings in Iceland. |
| Municipality of Ísafjörður | The port is part of the municipality. The municipality does also manage the tourist information office and therefore makes sure cruise passengers are welcomed. |
| Community of Ísafjörður | The great majority of the community are involved in the industry in some way. The residents of Ísafjörður are directly involved in the cruise industry by sharing their town’s services and attractions with cruise guests. Many of the local companies not involved in tourism do benefit economically by selling services and products to cruise visitors. |
| Bus companies and guides | The local bus company that services most of the cruise passengers, West Travel, does also operate a public bus service for locals. The tourism industry tries to use only local guides in cruise excursions. |
Popular attractions for cruise visitors are Ísafjörður downtown area which cruise passengers can reach by foot, Ósvör museum and Dynjandi waterfall, which the majority of cruise passengers visit by bus, Hornstrandir nature reserve and Vigur Island, which cruise passengers can access with a local boat transfer company from the port of Ísafjörður, and more.
For excursions in nature areas surrounding town, it is necessary for tour operators to consult with landowners regarding the traffic of people on private land and are expected to treat nature and wildlife with respect. All cruise ship masters receive a guideline on regulations and environmental conservation acts developed by the Environmental agency, Icelandic transport authority and the Icelandic coast guard who have the authority to make sure all laws and regulations are followed. Specific rules apply to the Hornstrandir nature reserve which is located north of Ísafjörður. All vessels are prohibited to go any closer than 115 meters in order to protect seabird habitation areas and no vessels with more than 51 people on board are allowed to go ashore. However, there are no rules on the limit of people allowed at the reserve at the same time. This prevents passenger ships with more than 51 persons on board to go directly to the nature reserve, as was the previous practice, and they must now anchor in Ísafjörður and use the local boat transportation to the reserve. However, since the limit on 51 passanger regards the transportation to and from Hornstrandir, and not how many tourists can be there at the same time, the practice is on busy days to have several groups of 51 people at Hornstrandir simultaneously, and the local boat transportation must go back and forth a lot. This local boat transportation is also used by locals to reach their cabins and summer houses on the peninsula and by hikers and campers.
The port of Ísafjörður is currently under construction, to build a 300 m extension of the existing pier Sundabakki, to a total of 500 m. The total cost of this project is estimated to be 1 billion Icelandic krónur. This project was launched to meet the needs of the cruise ship industry and to increase the port's revenue. With the extension, the port will be able to welcome large cruise ships that have up till now not been able to dock at Ísafjörður port and also more cruise ships at the same time. Cruise lines pay a higher docking fee to the port if they dock at the pier instead of anchoring out in the bay. The port’s revenue is expected to increase by 40 million a year with the extension. Today, a bit more than 50% of the port’s revenue comes from the cruise ship industry. This project is funded by the port of Ísafjörður with subsidies from the Icelandic government. There is a plan to invest in electrification infrastructure for small and medium-sized cruise ships with the extension which will reduce emissions while cruise ships are docked at port. The core businesses located at the port area are related to fishing activities. Other type of businesses and institutions are the University of Westfjords, educational centres, tourism businesses, tourist information office, museums, shops, restaurants and bar, car rentals and car repair shops.