Icelandic low-cost carrier PLAY ceases operations

Icelandic low-cost airline PLAY has abruptly ceased operations, cancelling all flights effective immediately. In a short statement addressed to passengers, the company confirmed that all services have been suspended and advised affected travellers to seek alternatives with other airlines, some of which may offer special “rescue fares” given the circumstances.

Passengers who booked flights directly with credit cards are advised to contact their card issuers for refund procedures, while those who purchased package holidays through travel agencies in the European Economic Area (EEA) should reach out to their travel agents.

Some rights may also apply under EU Air Passenger regulations. In case of bankruptcy, claims will have to be directed to the appointed administrator. Further guidance is available via the Icelandic Transport Authority and Keflavík Airport.

PLAY was launched in 2019 by former WOW Air executives Arnar Már Magnússon and Sveinn Ingi Steinþórsson under the initial project name WAB air (“We Are Back”). Backed by Irish and Icelandic investors, the airline was formally rebranded as PLAY in late 2019, adopting a bright red livery and Airbus A321neo aircraft as its fleet backbone.

Commercial operations began in June 2021 with flights from Keflavík International Airport to London Stansted. The airline quickly expanded its network to European cities such as Paris, Berlin, Copenhagen and Tenerife, later launching transatlantic services to the United States (Boston and Baltimore in 2022) and Canada (Hamilton, Ontario in 2023). In 2024, PLAY announced further expansion to Marrakesh in Africa and Antalya in Asia.

However, financial pressures soon mounted. In 2025, PLAY announced significant restructuring, including the creation of a Maltese subsidiary (Play Europe), the reduction of its transatlantic operations, and a pivot toward European leisure destinations. Several routes were terminated, and part of its fleet was allocated to wet lease operations for other carriers. Plans to privatize the company and transform into a virtual airline were later abandoned.

Despite multiple restructuring attempts, PLAY ultimately ceased operations in September 2025, marking the end of Iceland’s most recent attempt to sustain a low-cost competitor in the transatlantic and European markets.

The airline’s collapse echoes the fate of WOW Air, which went bankrupt in 2019, leaving Icelandair once again as the country’s dominant carrier.