PLAY, the low-cost Icelandic airline, is making a significant shift in its business model by placing greater emphasis on strong leisure markets out of Iceland, while reducing its focus on connecting passengers between North America and Europe.
The airline’s point-to-point routes, particularly between Iceland and Southern Europe, have been consistently popular and profitable. However, its hub-and-spoke operations across the Atlantic have delivered disappointing results in 2024, partly due to increased competition in the North American market, which has negatively impacted PLAY’s financial performance.
In response, PLAY is cutting capacity on its North Atlantic routes, with a reduction in destinations in North America and Northern Europe by mid-2025. Instead, the airline will focus more on leisure markets in Southern Europe.
In line with this shift, PLAY will begin utilising part of its fleet outside of Iceland, starting with a partnership with U.S. carrier GlobalX in Miami from November 1, 2024, to March 15, 2025. To support this, PLAY has applied for an air operating licence in Malta, expected to be finalised by spring 2025. The first aircraft under the Maltese AOC will operate from Tenerife to Keflavík and Akureyri in Iceland and other destinations. PLAY anticipates operating six to seven aircraft under its Icelandic AOC and three to four under the Maltese AOC.
Despite these operational changes, PLAY’s financial position remains stable, with no plans to raise capital. However, the airline’s EBIT for 2024 is expected to fall below last year’s results, reflecting the greater-than-expected impact of increased transatlantic capacity in spring and summer 2024.
