Delta Air Lines said on Friday it would not use artificial intelligence to set personalized ticket prices for passengers after facing sharp criticism from lawmakers.
Last week, Democrats Reuben Gallego, Mark Warner and Richard Blumental said they believe the Atlanta-based airline will use AI to set individual prices.
Delta says it plans to deploy AI-based revenue management technology to 20% of its domestic network by the end of 2025 in a partnership with AI pricing company Fetcherr.
“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,” Delta told the senators on Friday in a letter seen by Reuters. “Our ticket prices do not take into account personal data.”
The senator cited a comment from Delta President Glenn Hauenstein in December. The carrier's AI pricing technology says it can set fares based on forecasts of “amounts that people are willing to pay for premium products related to the base fare.”
Last week, American Airlines CEO Robert Isom said using AI to set ticket prices could undermine consumer confidence.
“This isn't about bait and switching. It's not about tricks,” Isom said in a revenue call, “I don't think it's appropriate to talk about AI use. And certainly from the US, that's not what we do.”
Delta said airlines have used dynamic pricing for over 30 years, with pricing fluctuating based on a variety of factors, including overall customer demand, fuel prices and competition, but not personal information for a particular consumer.
“Given tens of millions of fares and routes to sell hundreds of thousands of routes at any time, the use of new technologies like AI is committed to analyzing the process of analyzing existing data and the speed and scale that can accommodate changing market dynamics,” the Delta letter states.
It added that AI can “help analysts with pricing by reducing manual processes, accelerating analytics, and improving time to market for pricing adjustments.”
