Two months into operations, Icelandic startup airline PLAY is faring better than it had hoped. The airline is in a stronger cash position than planned, as it looks to start turning its European network into a hub and spoke model connecting Europe to North America from Spring 2022.
With many airlines struggling to survive during the COVID-19 pandemic, many thought that launching a new airline right now would be foolish. PLAY’s CEO disagreed, arguing that favorable lease rates, tied with a lack of accumulated debt during the pandemic, meant that now was the perfect time to launch an airline. So far, it looks as though he was right.
Almost 10,000 passengers in the first month
Play reported that in July, it met its fundamental goals of flight operation. These were to operate safely and reliably while maintaining a focus on keeping customers happy. In total, during July, the airline carried 9,899 passengers, meaning a relatively meager load factor of just 41.7%. PLAY revealed that a mid-July rise in COVID-19 cases had prompted some passengers to postpone their travel plans.
August treated the airline better as it continued its European rollout. Last month the airline carried more than 17,300 passengers. Despite this, the airline’s load factor remained relatively low at 46.4%. This means that while PLAY carried more passengers, it also operated a similar increase in flights. Moving forwards, PLAY expects both metrics to rise once more in September as COVID-19 cases in Iceland continue to fall.
Expanding the fleet
As of today, the PLAY fleet consists of three Airbus A321neo aircraft. The planes are leased from AerCap and were all previously operated by Mexico’s Interjet. In August, the airline signed two letters of intent to triple its fleet size by spring 2023, including running a more diverse fleet.
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At terms better than anticipated in the PLAY business plan, two Airbus A320s are included in the first LOI, due to be delivered by March 2022. Interestingly, PLAY is now also eyeing its first brand new aircraft. From the second LOI, PLAY is expecting three more A320neos and an A321neo. All four of these aircraft would be delivered directly from Airbus to PLAY by spring 2023. The airline is additionally looking at even more aircraft to bring the fleet to 15 jets by 2025.
Extending the network
Currently, PLAY is only flying from Keflavik in Iceland to destinations in Europe. This means that the airline is primarily restricted to flying people to and from the island, as it is not practical to fly from London to Berlin via Iceland.
This is all set to change early next year. With a fleet of six aircraft by spring, the airline is looking to launch flights to the west. These new North American destinations would allow the airline to tap into more Iceland-bound passengers.
More importantly, though, the airline will be able to tap into sixth freedom traffic. That means passengers flying on a PLAY plane from North America to Iceland, then changing to another PLAY plane bound for Europe, and vice-versa. For this reason, the airline isn’t planning to fly to the furthest North American destinations such as Los Angeles.
What do you make of PLAY’s start to operations and expansion plans? Let us know what you think and why in the comments!