Play and SkyUp Malta Redefine Airline Business Models

How Play and SkyUp Malta Are Redefining Airline Business Models

The aviation industry continues evolving as carriers adapt to shifting travel patterns and economic pressures. Icelandic low-cost carrier Play and Ukrainian operator SkyUp Airlines demonstrate this transformation through their new partnership. By deploying four Airbus aircraft to SkyUp Malta and prioritizing leisure routes, these airlines exemplify how operators are building resilience through hybrid business models.

This strategic shift comes as carriers worldwide balance seasonal demand fluctuations and geopolitical challenges. For Play, moving toward wet-lease operations creates stable revenue streams while maintaining its core leisure focus. SkyUp Malta’s expansion into scheduled EU flights illustrates how airlines leverage subsidiary structures to maintain operations during airspace restrictions.

Play’s Strategic Pivot

Play Airlines is transitioning from a pure low-cost carrier to a hybrid model combining leisure routes with aircraft leasing. The airline will deploy four A320-family jets to SkyUp Malta through 2027 under an ACMI (Aircraft, Crew, Maintenance, Insurance) agreement. This deal increases from three originally planned aircraft, reflecting strong demand for leasing services.

The shift follows Play’s Q1 2025 results showing reduced transatlantic capacity but improved cost control. While passenger numbers fell 18% year-over-year to 286,000, net losses narrowed slightly to $26.8 million. CEO Einar Örn Ólafsson emphasizes that wet-lease operations provide “stable, predictable income” to offset seasonal variations.

“This part of the business will provide us with a stable, predictable and profitable income.” – Einar Örn Ólafsson, Play CEO

Play’s summer 2025 schedule shows strategic rebalancing: 80% of 492,000 available seats target 28 European leisure destinations like Faro and Antalya. Transatlantic routes shrink to just three U.S. cities, reflecting higher yields in vacation markets versus competitive North Atlantic corridors.

SkyUp Malta’s European Expansion

SkyUp Airlines‘ Maltese subsidiary becomes crucial to both companies’ strategies. Established in 2023 with a Maltese AOC, SkyUp MT enables EU operations despite Ukraine’s airspace closure. The airline plans scheduled flights from Chișinău, Moldova to European destinations starting April 2025.

With 11 aircraft and experience serving 116 destinations, SkyUp brings operational expertise to the partnership. The Ukrainian carrier transported 2.5 million passengers in 2021 before adapting to wartime challenges through ACMI contracts. CEO Dmytro Seroukhov notes their Maltese subsidiary helps “connect Ukrainians worldwide” while maintaining fleet utilization.

“This return to regular flights is a step forward in connecting Ukrainians, wherever they are.” – Dmytro Seroukhov, SkyUp CEO

The Play-SkyUp Malta collaboration creates synergies – Play gains year-round aircraft utilization through European peak seasons, while SkyUp MT accesses modern Airbus jets to expand its EU network. This model proves particularly valuable as Eastern European travel demand rebounds.

Industry Implications of Hybrid Models

The aviation sector increasingly embraces hybrid strategies combining scheduled service with charter/ACMI operations. Data shows ACMI leasing grew 23% industry-wide since 2022 as airlines seek flexible capacity solutions. Play’s simultaneous focus on leisure routes and wet-leasing reflects this dual approach to revenue generation.

Analysts note such models help airlines:

• Mitigate seasonality through stable leasing income
• Maintain fleet utilization during off-peak periods
• Access new markets via partner networks

For smaller carriers like Play (10 aircraft) and SkyUp (11 aircraft), collaboration becomes essential against legacy competitors. Their partnership demonstrates how regional airlines can pool resources while maintaining brand identities – a trend likely to accelerate as fuel costs and sustainability pressures mount.

Conclusion

The Play-SkyUp Malta agreement highlights aviation’s evolving landscape, where adaptability determines survival. By blending scheduled leisure routes with aircraft leasing, both carriers create complementary revenue streams. This approach proves particularly effective for airlines operating in constrained markets or facing geopolitical challenges.

Looking ahead, expect more carriers to adopt hybrid models combining core operations with ancillary services. As travel demand fragments into leisure/VFR/Business segments, flexible fleet deployment strategies will separate resilient airlines from vulnerable competitors. The success of this partnership could inspire similar collaborations across Europe’s competitive aviation market.

FAQ

Why is Play Airlines reducing transatlantic flights?
Play is focusing on higher-yield European leisure markets while using wet-lease deals to maintain fleet utilization during off-peak periods.

How does SkyUp Malta’s AOC help both airlines?
The Maltese air operator certificate allows EU operations despite Ukraine’s airspace closure, enabling SkyUp to maintain revenue streams through European flights.

What percentage of Play’s business comes from wet-leasing?
While exact figures aren’t disclosed, the four aircraft deployed to SkyUp Malta represent 40% of Play’s 10-jet fleet during summer 2025.

Sources: Aviation Week, Aviacionline, Wikipedia