The company had offered low fares and charged fees for seat assignments, baggage, and onboard food.
The low-cost, Iceland-based airline Play shut down all flying abruptly on Monday, stranding thousands of passengers. Passengers with bookings to fly the airline that day were told that the airline had ceased operations that morning, and that competing airlines may offer special “rescue fares” to accommodate passengers with now-worthless tickets.
Icelandair, the country’s longtime flagship carrier, has announced that it will add flights to accommodate passengers affected by the disruption, but will not offer special fares to Play ticketholders. Icelandair has already added flights to Copenhagen from Reykjavik and will add more flights in the coming days. Condor Airlines is offering rescue fares to Play passengers—including those with travel plans between the U.S. and Europe.
Keflavik International Airport, Play’s main base of operations, noted that a total of 12 flights were cancelled on Monday, impacting approximately 1,750 passengers. The airport stated that it had staff on site to assist passengers affected by the shutdown.
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Formed by executives from Wow Air, another Icelandic low-cost airline that similarly ceased operations in 2019, Play began service in 2021, eventually growing to serve destinations in the United States and Europe from Iceland. The company offered low fares and charged fees for seat assignments, baggage, and onboard food. Initial plans to focus on connecting passengers between the United States and Europe via Iceland didn’t yield expected results, and the airline went through several rounds of changes in its business model.
Play had anticipated ending all service from the U.S. to Iceland by fall 2025 to focus on flying passengers between Iceland and sunny destinations in southern Europe and northern Africa, but the airline’s complete cessation of service ended those routes early. The airline had flown to Baltimore, Boston, Washington Dulles, and Newburgh, New York.
In a statement from the company’s board of directors, the airline’s management blamed weak ticket sales and negative media coverage of its operations. The statement also noted that the closure would result in the loss of 400 jobs.
The business model of airlines seeking to connect passengers between Europe and the US at a discount appears to be faltering. Play is the second Icelandic low-cost airline to shutter operations in the past six years. Iceland has offered a cheap (albeit slower) route from the U.S. to Europe for years, but lower fares on major carriers and more nonstops from the U.S. to secondary markets in Europe have eaten into passenger demand for travel via Iceland.
Passengers who have paid for tickets on Play using their credit card can contact their card issuer for a refund, as long as their flights were scheduled for after the company ceased operations. Passengers who paid for their tickets via electronic bank transfer or debit cards should also contact their financial institution for assistance, but refunds could be more difficult.
Because Play was subject to the EU consumer protection regulation known as EU261, passengers can also file a claim for monetary compensation in addition to a refund of their tickets, but it may be challenging to collect if the company doesn’t have enough assets to cover their outstanding debts, including refunds owed passengers who paid with debit cards or bank transfers, employee wages, and airport rents and usage fees.
Play has also advised passengers to contact their travel insurance carriers to cover their losses, but many insurance carriers will not cover companies for financial default unless they’re on a preapproved list of suppliers. Play was not on the list of covered suppliers for the insurance provider Allianz at the time of its closure.
