Delta Air Lines Reaffirms No Plans for AI-Driven Personalized Ticket Pricing
On Friday, Delta Air Lines announced it would not employ artificial intelligence to determine individual ticket prices after receiving significant backlash from lawmakers.
Recently, some Democratic senators, including Reuben Gallego, Mark Warner, and Richard Blumenthal, expressed concerns, suggesting that the airline might use AI to set custom prices for passengers.
Delta has clarified that it intends to implement AI-based revenue management technology across 20% of its domestic operations by the end of 2025, in collaboration with the AI pricing firm Fetcherr.
In a letter to senators, which was reviewed by Reuters, Delta stated, “There is no fare product that Delta has used so far. There is no test or use plan to target customers at individual prices based on personal data.” They emphasized that personal data does not influence their ticket pricing.
Delta President Glenn Hauenstein had previously commented in December that their AI pricing technology could adjust fares based on predictions of what customers are willing to pay for premium services, linked to the base fare.
In a contrasting statement, American Airlines CEO Robert Isom voiced caution, saying that utilizing AI for ticket pricing might erode consumer trust. “This isn’t about bait and switching. It’s not about tricks,” he remarked during a revenue call. He emphasized that American Airlines doesn’t adopt such practices in the U.S.
Delta pointed out that dynamic pricing has been a standard practice for over 30 years, adjusting based on various factors such as customer demand, fuel costs, and competition, but not personal information about individual consumers.
The airline’s letter further explained, “With tens of millions of fares and routes to sell, AI can significantly enhance the analysis process by quickly accommodating changing market dynamics.” They added that such technology could streamline pricing analyses, making them quicker and more efficient.
