Delta Air Lines Will Not Use AI for Personalized Ticket Pricing
By David Shepardson
WASHINGTON (Reuters) – Delta Air Lines announced on Friday that it will not be utilizing artificial intelligence to set personalized ticket prices for passengers, following backlash from U.S. lawmakers.
Last week, Democratic Senators Ruben Gallego, Mark Warner, and Richard Blumenthal raised concerns that Delta would implement AI technology to adjust prices individually, potentially leading to fare increases based on each consumer’s personal ‘pain point’.
Delta clarified that it intends to implement AI-based revenue management technology across a portion of its domestic network by the end of 2025 in partnership with Fetcherr, an AI pricing company. However, the airline assured lawmakers that no fare product targets customers with personalized prices using personal data.
The senators referred to a statement made by Delta President Glen Hauenstein in December, suggesting that the carrier’s AI pricing technology could determine fares based on predicting what individuals are willing to pay for premium products related to base fares.
American Airlines CEO Robert Isom also weighed in on the debate, expressing concerns that using AI for price setting could undermine consumer trust. Isom emphasized that American Airlines would not engage in such practices.
Delta emphasized that airlines have employed dynamic pricing for over three decades, where fares fluctuate based on factors like overall demand, fuel costs, and competition, rather than specific consumer data.
The airline’s letter to lawmakers highlighted the potential benefits of utilizing AI technology in pricing strategies, noting that it could streamline data analysis processes, accelerate decision-making, and enhance market responsiveness.
As the aviation industry continues to evolve, Delta is committed to leveraging innovative technologies while maintaining transparency and fairness in its pricing practices.
(Reporting by David Shepardson; Editing by Chizu Nomiyama and David Gregorio)
