Icelandic Low-Cost Carrier PLAY Enters Administration
Icelandic airline PLAY has officially entered administration, resulting in the immediate grounding of all its flights. The low-cost carrier, headquartered in Reykjavík, ceased operations on September 29, 2025, leaving around 400 staff members facing redundancy.
Immediate Cessation of Operations
The airline announced the termination of all services with immediate effect, confirming the news through a statement on its official website. "Dear passenger, Fly PLAY hf. has ceased operations, and all flights have been cancelled," the statement read. This abrupt shutdown has left passengers stranded and employees uncertain about their future.
According to reports from local media outlet RUV, the company is attempting to settle outstanding wage payments to affected staff. However, it remains unclear whether all employees have received their full entitlements following the administration process.
Background and Expansion
PLAY was established in July 2019 and commenced operations from its base at Keflavík International Airport in Reykjavik in June 2021. The carrier initially served six key European destinations: Alicante, Tenerife, London, Paris, Copenhagen, and Berlin. It also operated services between London and Reykjavik, though seats were no longer available for sale after November 1, prior to the official announcement.
Board Statement and Strategic Challenges
The board of PLAY issued a detailed statement explaining the decision to wind down operations. "The board of Fly Play hf. has decided to terminate operations, and all of the company's flights have been cancelled," they stated. The company pledged to work closely with authorities and employees to manage the necessary steps for an orderly shutdown.
The board cited multiple factors contributing to the airline's downfall, including prolonged underperformance, poor ticket sales in recent weeks and months exacerbated by negative media coverage, and internal disagreements among employees regarding strategic changes. These issues collectively strained the airline's financial stability.
Failed Business Model Changes
Further information from the board highlighted unsuccessful modifications to the business model. "Last fall, Play introduced a new business model that initially inspired significant optimism," they noted. However, it became apparent that these changes were insufficient to address the airline's deep-seated financial troubles.
In hindsight, the board acknowledged that such measures would have needed to be implemented much earlier to potentially avert the crisis. The inability of these strategic shifts to deliver the required results ultimately led to the decision to enter administration and cease all operations.
