Delta Air Lines Defends AI Pricing Amid Legislative Scrutiny

Delta Air Lines has responded to recent concerns raised by lawmakers regarding its use of artificial intelligence (AI) in airfare pricing. In a letter addressed to three Democratic senators, the Atlanta-based airline emphasized that it does not utilize customer data for targeted pricing, countering accusations of “individualized” and “surveillance” pricing practices.

Peter Clark, Delta’s Chief External Affairs Officer, clarified that the airline’s AI-assisted pricing program is designed to enhance revenue management without infringing on customer privacy. “This is incorrect, and this assumption has unfortunately created confusion and misinformation in the public discourse,” he stated. Delta maintains a strict policy against discriminatory or predatory pricing and adheres to all relevant laws concerning privacy and advertising.

Delta first announced its use of AI for a limited segment of domestic bookings last fall, describing the technology as a “super analyst” that supports human revenue management teams. As of last month, AI had been integrated into approximately 3% of Delta’s domestic routes through a collaboration with tech firm Fetcherr. Delta President Glen Hauenstein expressed ambitions to expand AI usage to around 20% of routes by the end of 2025.

The airline’s AI implementation has attracted attention from both Congress and competitors. Senators Mark Warner of Virginia, Ruben Gallego of Arizona, and Richard Blumenthal of Connecticut sent a letter last month seeking further clarification on Delta’s pricing strategies. In response, American Airlines CEO Robert Isom criticized Delta’s AI approach, asserting that American does not intend to adopt similar practices.

Delta has described its AI program as a “decision-support tool” that forecasts demand and suggests fares based on traditional business factors such as booking patterns, route competition, and fuel prices. Interestingly, the AI tool can also recommend lower fares when demand is weak, potentially benefiting consumers.

In addition to pricing, Delta is exploring AI applications in various operational areas, including customer service and predictive maintenance for aircraft and parts. This broader integration of AI is part of the airline’s strategy to enhance overall efficiency and service quality.

As the conversation around AI in the airline industry evolves, Delta’s commitment to transparency and adherence to ethical pricing practices will be crucial in maintaining consumer trust and regulatory compliance.