Hún heldur báðum höndum á stýrinu þegar umferðin er mikil.

Heldur is the 3rd person singular present tense of the verb halda.

Because the subject is hún (she), Icelandic uses the she/he/it form of the verb:

• ég held – I hold/keep
• þú heldur – you hold/keep
• hún heldur – she holds/keeps

So Hún heldur ... means She holds/keeps ...

One extra note: heldur can also be a different word meaning rather or appearing in expressions like ekki ... heldur (not ... but rather / nor). In this sentence, though, it is clearly the verb form of halda.

Because both words are inflected.

• báðum is the dative plural form of báðir (both)
• höndum is the dative plural form of hönd (hand)

So:

• dictionary form: hönd
• here in the sentence: höndum

This is especially worth noticing because hönd is an irregular noun. Its plural forms are not fully predictable, so höndum is a form you should just learn as part of the noun’s pattern.

Because the verb halda often takes a dative object when it means hold or keep.

So in this sentence, báðum höndum is in the dative because it is linked directly to heldur.

A useful way to think about it is:

• halda e-u = hold/keep something
  where e-u stands for a dative form

That is why you get báðum höndum, not nominative or accusative forms.

Because á can take either the dative or the accusative, depending on meaning.

• á + dative = location, being on something
• á + accusative = movement onto something

Here the meaning is static: her hands are on the steering wheel, not moving onto it. So Icelandic uses the dative:

• á stýrinu = on the steering wheel

Compare:

• Hún hefur hendurnar á stýrinu. – Her hands are on the wheel.
• Hún setur hendurnar á stýrið. – She puts her hands onto the wheel.

Stýrinu is the dative singular definite form of stýri, a neuter noun.

Here it means the steering wheel.

A quick breakdown:

• stýri – steering wheel / wheel
• stýrið – the steering wheel (nominative/accusative singular definite)
• stýrinu – to/on the steering wheel (dative singular definite, depending on context)

So á stýrinu literally means on the steering wheel.

Because Icelandic often omits possessive words like her, his, or my when the owner is obvious, especially with body parts and often with clothing.

So:

• Hún heldur báðum höndum á stýrinu
  naturally means
  She keeps both of her hands on the steering wheel

Icelandic does not need to say her here, because it is already clear that the hands belong to her.

This is very common and sounds natural.

Umferðin is the definite form of umferð (traffic), so it literally means the traffic.

In Icelandic, the definite form is often used when talking about the traffic in the current situation or the traffic around you at that moment. So:

• umferðin er mikil = the traffic is heavy / traffic is heavy

Even if English might sometimes prefer just traffic, Icelandic often uses the definite form in this kind of real-world context.

Because adjectives in Icelandic agree with the noun they describe in gender, number, and case.

Here the noun is umferðin:

• umferð is feminine
• it is singular
• here it is nominative

So the adjective mikill (big, much, great, heavy) must appear in the matching form:

• mikil

That is why the sentence says:

• umferðin er mikil

In this context, mikil is best translated as heavy or busy, as in heavy traffic.

Þegar means when here. It introduces a time clause:

• þegar umferðin er mikil = when traffic is heavy

So the sentence has:

• a main clause: Hún heldur báðum höndum á stýrinu
• a subordinate time clause: þegar umferðin er mikil

This is a very common structure in Icelandic.

Because after a subordinating conjunction like þegar (when), Icelandic normally uses regular subject + verb order inside the subordinate clause:

• þegar umferðin er mikil

That is completely normal.

If the þegar-clause comes first, then the main clause usually shows inversion:

• Þegar umferðin er mikil, heldur hún báðum höndum á stýrinu.

So:

• subordinate clause first -> main clause verb comes before the subject
• subordinate clause last -> no special change is needed in the main clause

Either can work, depending on how naturally you want to phrase it in English.

A fairly literal reading is:

• She holds both hands on the steering wheel
• She keeps both hands on the steering wheel

But more natural English would usually be:

• She keeps both hands on the steering wheel
• or She holds the steering wheel with both hands

So the Icelandic structure is not always translated word-for-word. The core idea is that she maintains both hands on the wheel.

Yes, but it would be a slightly different structure.

This sentence says:

• Hún heldur báðum höndum á stýrinu.

Another natural way to express a similar idea is:

• Hún heldur í stýrið með báðum höndum.

That means more literally:

• She holds the steering wheel with both hands.

So:

• báðum höndum in the original sentence is tied to the verb halda
• með báðum höndum is a separate with both hands phrase

Both are possible, but they are built differently.