Amadeus builds up its North American portfolio after scoring key wins with Air Canada and Southwest

Amadeus has scored an important win in North America during 2017 after Air Canada named the company as the supplier of its new passenger service system (PSS).

Air Canada has concluded the Amadeus system provides a full and robust retail platform and dynamic distribution. Prior to Amadeus securing new business from Air Canada, the airline estimated the new system would produce CAD100 million of incremental benefits for the airline.

The important win from Air Canada follows Southwest selecting Amadeus for its new reservation system three years ago. The new system debuted in May-2017, and Southwest believes the implementation has gone well.

Southwest has faced some revenue headwinds associated with the new reservations system, but estimates the Amadeus platform should drive a USD200 million EBIT (earnings before interest and taxes) in 2018. “We remain very pleased with the progress of the rollout,” the airline recently concluded.

The airline has a couple of more software releases for the platform scheduled for 2017, and is working to iron issues associated with recognising revenue from its Upgraded Boarding product. At the end of 2Q2017 Southwest executives stated that product was not working the way the company intended. The airline remarked revenue it derives from that particular product was not huge, but was an example of some of the items that needed resolution.

Another issue Southwest was facing with the new system was challenges in re-opening seat inventory for sale if there are cancellations related to a product Southwest offers for ten or more customers travelling in group. “That’s where we are seeing a revenue penalty, if you will,” said company CEO Gary Kelly.

Mr Kelly stressed the few items that needed to be resolved “has nothing to do with the elegance of the system…there are just a couple of one-off items that we found, that we’ll fix and get behind us”.