Low-cost airlines have a turbulent history, with many coming and going over the years. Recently, PLAY airlines, which had been in operation for four years, announced its closure. The airline had flown over one million passengers to Iceland and various European destinations, but issues such as poor ticket sales, internal conflicts, negative media coverage, and problems with their North American market ultimately led to its demise. The fate of its fleet of ten Airbus A3 20neo aircraft is currently uncertain.
The low-cost, long-haul airline industry is incredibly competitive and challenging. While some recent start-ups like Norse Atlantic, Breeze, and JSX have shown promise, the industry is also littered with the failures of carriers who attempted to offer affordable flights to millions of people over thousands of miles. PLAY initially saw success, with high load factors of 87% and hundreds of thousands of passengers. The airline operated flights from several airports in North America, such as Baltimore/Washington, Boston Logan, and New York Stewart International Airport, to 30 European destinations, including popular cities like Berlin, Paris, and London.
In an interview in 2023, PLAY’s CEO Birgir Jónsson attributed their success to their “hub-and-spoke model” that connected passengers between North America, Iceland, and Europe. Iceland’s strategic location made it an ideal stopover for short flights between the two continents, and it was also a popular destination on its own.
However, PLAY is not the first low-cost airline to fail with this business model. WOW Air, another Icelandic carrier, also operated flights between Europe and North America and eventually collapsed in 2019 due to financial losses and an inability to secure funding or merge with another airline. The sudden closure left thousands of passengers stranded, and the same fate befell PLAY’s passengers when the airline ceased operations. PLAY had already been scaling back its transatlantic flights for several months before ultimately ending all of its US routes in June of this year.
In its final months, PLAY attempted to focus on the European market and even offered its planes and personnel for wet leases to other carriers. However, news of their struggles spread, and the negative media coverage and internal conflicts within the company were cited as contributing factors to their ultimate failure. Some passengers were left stranded, and PLAY’s board of directors advised them to check for special “rescue fares” with other airlines or seek refunds through their credit card companies or tour operators.
Upon reflection, PLAY faced several challenges that may have contributed to its downfall. For example, instead of flying out of major international airports like JFK or Newark, PLAY operated out of Stewart Airport, which required a two-hour bus ride from Manhattan. This strategy, previously used by Norwegian Airlines, also faced difficulties, and the airline was forced to restructure and focus solely on European operations. Fortunately, Norwegian Air Shuttle is now one of the top low-cost airlines in Europe, and its reputation with customers has improved significantly.
Sadly, PLAY’s customer reputation was