PLAY Airlines ceases operations after four years amid financial struggles

PLAY Airlines, the Icelandic low-cost carrier known for its red livery and based at Keflavik International Airport, has ceased operations after a little over four years. The airline had recently shifted its focus from transatlantic flights to European routes and increased its wet-lease operations as scheduled flights were reduced.

In 2025, PLAY transitioned to being a privately held company while seeking new business opportunities. Despite these efforts, the airline faced multiple challenges that led to its closure. In a statement released earlier today, PLAY’s board announced the end of operations and the cancellation of all flights. Passengers were advised "to check flights with other airlines, [as] some may offer special 'rescue fares' considering the circumstances."

For reimbursement, PLAY directed passengers who booked with credit cards to contact their card issuers and those who booked through tour packages to reach out to their travel agents. The airline stated it "will work closely with authorities and employees to implement necessary measures to wind down operations." The board added: "Every effort was made to reach a different outcome. This decision is the most painful one imaginable in this situation and has only been taken because all other options were deemed exhausted. The Board sincerely apologizes to everyone negatively affected by this outcome."