Icelandic Carrier PLAY Ceases Operations Despite Recent Funding and Strategic Pivot
/https://aviacionlinecdn.eleco.com.ar/media/2024/05/play-airplane.jpg)
The Icelandic ultra-low-cost carrier, PLAY, has ceased operations effective immediately, canceling all its flights. The abrupt end concludes a turbulent four-month chapter during which the company attempted to execute a profound and radical restructuring to save itself from a fate it ultimately could not avoid.
With its base at Keflavik (KEF) and a modern fleet of Airbus A320neo aircraft, PLAY faced a financial crossroads. As reported by aviation media in June 2025, the company's management, led by its CEO, launched a bid to take control, delist it from the stock exchange, and implement a survival plan. The premise was clear: the transatlantic model was not working.
The numbers were stark: while point-to-point leisure routes generated a positive contribution of USD 24 million in 2024, the hub-and-spoke model connecting North America and Europe via Iceland resulted in a USD 20 million loss. Overcapacity in the North Atlantic and the advent of longer-range narrow-body aircraft made the Keflavik stopover unsustainable.
The Chronicle of a Failed Strategic Pivot
The June plan was a complete reinvention. PLAY would entirely abandon its flights to the United States and Canada to focus on two pillars: the leisure market from Iceland with four aircraft operating as a virtual airline, and aircraft leasing under an ACMI (Aircraft, Crew, Maintenance, and Insurance) model with the remaining six aircraft operating from a new base in Malta.
To achieve this, the company would surrender its Icelandic Air Operator Certificate (AOC) to operate under a Maltese AOC, leveraging the Mediterranean island's more favorable regulatory and tax environment for the leasing business. The strategy was hinged on a key asset: fleet lease agreements signed during the pandemic, which were 25-30% cheaper than current market rates.
The projections were extremely optimistic. The plan forecasted a "$58 million turnaround," moving from a pre-tax loss of USD 51.6 million in 2024 to a profit of USD 3.1 million by 2026.
A Race Against Time to the End
Despite the plan's boldness, the following months proved the company was racing against time. The second-quarter 2025 results revealed a net loss of USD 15.3 million, and the cash position had dwindled to just USD 11.9 million.
The last glimmer of hope arrived on September 7, when the company celebrated completing its financing round (a key condition of the June plan), securing USD 23 million. Management hailed it as a confirmation of "investor confidence in the company's future." However, the capital injection turned out to be a temporary patch, not a definitive solution. The money was insufficient to sustain the cost structure while the complex transition to Malta was underway.
Just three weeks after that optimistic announcement, the airline ceased operations. The demise of PLAY is a case study of how even a correct financial diagnosis and a radical restructuring plan can be insufficient when time and cash run out, ultimately replicating, albeit via a different path, the fate of its predecessor, WOW Air.
Para comentar, debés estar registradoPor favor, iniciá sesión