Try to diversify with Maltese AOC as competition forces transatlantic withdrawal

Icelandic budget airline Play plans to obtain a Maltese air operator certificate to diversify its operations as its transatlantic operations come under pressure.

The aim is to support its southern European services and to use the Maltese AOC to base aircraft in Tenerife, serving both Icelandic and other destinations.

Chief Executive Einar Orn Olafsson had hinted at such a strategy in a conversation with FlightGlobal earlier this year, suggesting the airline could use Spanish crews to operate opposite sectors from southern Europe to Iceland.

The airline, which operates a fleet of Airbus single-aisle jets, expects to complete the Maltese AOC process by spring next year.

It states that three or four aircraft will be allocated to the Maltese AOC and six or seven aircraft will be reserved for the Icelandic AOC.

Although the airline says its financial position is “safe” and it has no plans to raise additional funds, it says its full-year profits are likely to fall below last year’s levels.

It attributes this to increased competition, greater capacity and lower yields on transatlantic routes and says that in response it is “reducing” its transatlantic operations and reducing the number of North American destinations “significantly” next year.

In contrast, Play says its point-to-point services have been “popular and profitable from the start” and will focus on that area instead.

“We have observed changes in the market and believe that the Via route network is no longer as profitable as it used to be,” says Olafsson.

He says the diversification plan involves temporarily leasing one of its 10 aircraft to Miami to fly on behalf of US airline GlobalX from November to March.

Olafsson adds that Play is “exploring a year-round project,” without elaborating.