The two airlines’ route networks, sales, and marketing will merge under the current Icelandair brand.
The airline explains that the move will strengthen key destinations all over the country and benefit customers in the form of higher flight frequency and better service.
After the change, destinations all over Iceland will become visible on the Icelandair website through the same search, for a single ticket to and from any European or North American destination. Icelandair’s domestic destinations will be Akureyri, Egilsstaðir, Ísafjörður, and Vestmannaeyjar, the same as today with Air Iceland Connect.
Source: RÚV
Q&A: https://www.icelandair.com/flights/campaign/icelandair-and-air-iceland-connect-integration/