Iceland’s PLAY Airlines to shift operations to Malta, end U.S. flights

Icelandic budget airline PLAY is preparing to transfer its operations to Malta under a new subsidiary, Fly Play Europe, as part of a shareholder-led takeover bid. If completed, the airline will give up its Icelandic operating licence and move its fleet of 10 Airbus A320neo aircraft to Malta, with the transition expected to finish by next year.

The move marks a strategic shift away from North American routes, which will cease in October, toward a focus on “sunny destinations” and aircraft leasing. Four planes will continue flying from Iceland, while six will be leased out. Despite the shift, PLAY says passengers will not notice changes—aircraft, crew, and branding will remain the same.

PLAY clarified that it does not plan to operate flights to or from Malta, including charters. The airline’s Maltese office will take on a greater operational role, and its parent company will delist from the Icelandic stock exchange, shifting emphasis to Malta and Lithuania.

The airline, which posted $26.8 million in losses in Q1 2025, recently secured a long-term deal to lease four aircraft to SkyUp Malta, a Ukrainian-owned carrier, through 2027.

The takeover is being led by CEO Einar Örn Ólafsson and board vice-chair Elías Skúli Skúlason, with backing of at least $20 million in investment.