Delta Air Lines defends use of AI in airfare pricing tactics – The Points Guy

Delta Air Lines fired back at lawmakers this week, defending its use of artificial intelligence in pricing airfare.

In a letter to three lawmakers reviewed by TPG, the Atlanta-based carrier again insisted it’s not tapping into customer data or targeting individual consumers as part of a new AI-assisted pricing program.

Delta specifically disputed concerns raised by three Democratic senators who, last month, accused the airline of “individualized” and “surveillance” pricing.

“This is incorrect and this assumption, unfortunately, has created confusion and misinformation in the public discourse,” Delta Chief External Affairs Officer Peter Clark wrote in a letter Thursday. “Furthermore, we have zero tolerance for discriminatory or predatory pricing and fully comply with applicable laws in privacy, pricing and advertising.”

Delta first revealed it was using AI on a small portion of domestic bookings last fall, likening the technology to a “super analyst” assisting its human revenue management workers.

By last month, the carrier had integrated AI on about 3% of its domestic routes through a partnership with tech firm Fetcherr, Delta President Glen Hauenstein said, noting the carrier hoped to increase its AI usage to about 20% of routes by the end of 2025.

That revelation drew scrutiny from Capitol Hill to the C-suite of top competitors.

Senators Mark Warner (a Democrat from Virginia), Ruben Gallego (a Democrat from Arizona) and Richard Blumenthal (a Democrat from Connecticut) penned a letter to the airline last month, demanding more clarity about the company’s AI pricing tactics.

Then, last week, American Airlines CEO Robert Isom said Delta’s use of AI was “not appropriate” and contended American didn’t plan to use AI in its fare-pricing practices.

Responding this week, Delta said its new AI program was merely a “decision-support tool” that forecasts demand and recommends fares based on many of the same business considerations that have dictated fares for decades, from booking patterns to route competition and fuel prices.

In some cases, Delta’s AI tool recommends cheaper fares — presumably when seats aren’t selling.

Delta noted it’s also integrating AI into other parts of its business, including in customer service and in predicting when a plane or aircraft part might need maintenance.

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