Play, a low-cost Icelandic airline, has shut down. The carrier is telling passengers: “All flights have been cancelled. We are deeply sorry for the disruption this causes and thank you for your understanding.”
Around 500 staff have lost their jobs.
The airline had been in existence for about five years. It follows former Icelandic carriers Primera Air and Wow Air into aviation oblivion. Those airlines failed in 2018 and 2019 respectively.
Play is telling passengers who have forward bookings: “We kindly advise you to check flights with other airlines.”
These are the key questions and answers.
What was Play Airlines?
Play was created in 2019 by two Wow Air executives, after that airline went bust. It started flying on 24 June 2021.
The business model was similar to Wow Air – and, indeed the national carrier Icelandair, which continues to be successful.
The aim was to cater for “point to point” traffic between Keflavik International airport outside Reykjavik and locations in Europe, as well as running a network to the US that capitalised on Iceland’s prime North Atlantic location.
Until Monday morning, Play was serving European destinations including London Stansted, Amsterdam, Paris CDG, Alicante and Faro. The last flight from Reykjavik to Stansted arrived on schedule at 10.40am on Monday. The aircraft is still on the ground, with the return to Reykjavik cancelled.
Departures from Monday afternoon onwards are grounded, including on the sole remaining US route to Baltimore Washington International.
What went wrong at Play?
Prodigious financial losses throughout its brief existence. While many carriers lost money during Covid, most of them have recovered. Not Play.
In February 2025, the chief executive, Einar Orn Olafsson, claimed the airline had been turned around, saying: “The transformation of Play’s business model is becoming increasingly evident … our revised flight schedule is already driving higher revenues and improved financials. Looking ahead to 2025, we are optimistic about continued progress.”
But that was at the end of a year in which Play had lost $66m (£49m), the equivalent of £31 for every passenger carried, which was evidently not sustainable.
Play’s most recent financial results were in August 2025, when it predicted profitability would begin in 2026.
The aviation analyst Sean Moulton said: “Play tried to replicate Wow Air, connecting secondary cities Europe to the US. But the market is limited and low yield.
“Whilst they tried to change strategies by focusing on point-to-point, leisure destinations, the Icelandic population is small and any airline would struggle with this alone.
“The gap will allow Icelandair to expand.”
The Independent estimates around 120,000 passengers have forward bookings with Play.
I am stranded due to the collapse of Play – what should I do?
Sit tight for a few hours or days. Standard airline practice is to offer “rescue fares” to passengers whose carrier goes bust. These are seats at low prices sold to travellers who can prove they have a valueless Play booking. Icelandair and easyJet are expected to offer fares of around £50 between the UK and Iceland.
Between Baltimore and Iceland, Icelandair may offer a fare of around £100. While you are waiting, travel insurance may pick up the bill for your living expenses.
I have a forward booking with Play. What are my rights?
Andrew McConnell, spokesperson at the UK Civil Aviation Authority, said: “It’s always unfortunate when an airline ceases operations, and we understand that Play Airlines’ decision will be unsettling for its employees and customers.
“UK customers seeking the latest information are advised to visit the Civil Aviation Authority’s website.”
The chances are that you paid with a credit or debit card. UK financial institutions will typically refund the payment without fuss.
If you have booked a package holiday for the future that includes flights on Play, the organiser of the trip is obliged to find an alternative way for you to reach the destination, or offer a full refund.
My Play flight last month was late or cancelled. Will I get the compensation I am due?
Sadly not. Even if a claim under air passengers’ rights rules has been approved, if the money has not yet been paid to you then it will not appear. This applies both for cash compensation and for reimbursement of expenses incurred as a result. Travel insurance may help with the latter.
Are other airlines in danger of collapse?
All the airlines that the vast majority of British travellers will fly on – including British Airways, easyJet, Jet2, Ryanair, Virgin Atlantic and Wizz Air – are in good financial shape.
Listen to Simon Calder’s podcast with the Play Airlines CEO from July 2024
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