1938 January 24 Ceremony to begin work on the new AA hangars at Spilve.
April 23 Bandenieks crashes the VEF/Irbitis I-14. Although he was essentially unhurt, the aircraft was destroyed.
May 14-22 International Aircraft Exhibition in Helsinki, with VEF/Irbitis I-12 prominently on display.
On May 18, Karlis Lesinskis and his passenger crash and die during a demonstration flight.
June 2 The prototype KOD-2 is delivered, followed shortly by two more. June 5 K.Stojazs makes his first parachute jump, at the Krustpils Aviation Festival.
July 3H.Pakulis makes his first parachute jump, at the Valmiera Aviation Festival. July 10J.Rudzitis makes his first parachute jump, at the Kuldiga Aviation Festival. July Philip d.W.Avery flies the VEF/Irbitis I-12 nonstop from London to Riga in 9 hrs. and 5 minutes, beating the previous record by a margin of an hour and 40 minutes. July VEF is awarded a contract to construct six SV.5s. The decision to turn to VEF for future aircraft needs leads to the shutdown of LKOD's aviation division.
Summer LKOD aviation branch closes, leaving five of the 12 KOD-2s ordered unbuilt. Summer VEF/Irbitis begin work on the I-15a and I-15b prototypes.
September 30 - Four VEF I-12s are presented to the AA. Two were gifts from the ministry of agriculture, one from an association of plywood manufacturers, and one from VEF dealers.
- The two AA hangars at Spilve are completed.
Autumn A new hangar, with a small workshop attached, is built at Spilve for VEF.
DecemberP.Sotnieks is relieved of his duties at the Riga Aviation school.
- Eriks Sraders sets a Latvian sailplane endurance record of 3 hours, 15 minutes.
- Latvians purchase four Hawker Hinds from Great Britain.
- G.Norvickis joins the Air Transport Branch of the Ministry of Transport, with responsibility for the government-run airline.
- In recognition of his achievements developing aircraft for the AA, Georgs Novickis is awarded the Aizsargu Merit Cross.
- R.Kandis becomes commander of the Aviation Regiment.