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Delta Air assures US lawmakers that it will not personalize its fares by using AI

Delta Air Lines announced on Friday that it would not use artificial intelligence in order to determine the personalized price of tickets for its passengers, after being criticized by U.S. legislators.

Last week, Democratic senators Ruben Galego, Mark Warner, and Richard Blumenthal stated that they believed Atlanta-based airlines would use AI in order to set individual prices. This would "likely" mean that fares would increase up to the individual consumers' personal "pain points."

Delta plans to deploy AI revenue management technology on 20% of its domestic networks by 2025, in partnership with Fetcherr.

Delta informed the Senators via a Friday letter that it had never used or tested fares that target customers with personalized prices based upon personal data. "Our ticket prices never take into account personal information."

The senators cited comments made by Delta President Glen Hauenstein in December that Delta's AI-based price-setting system is capable of setting prices based on "the amount of money people are willing pay for premium products compared to base fares."

Robert Isom, CEO of American Airlines, said last week that using AI to determine ticket prices could harm consumer confidence.

This is not about trickery. Isom stated on a earnings call that "this is not about tricks" and added, "talking about AI in such a way, I do not think it's right." It's certainly not something that we will do from American.

Delta Airlines said that airlines have been using dynamic pricing for over three decades. Pricing fluctuates depending on factors such as overall demand, fuel costs, and competition, but not the personal information of a particular consumer.

"With tens and millions of fares, hundreds of thousands routes available at any time, using new technology is a must."

Delta's letter stated that "AI technology promises to streamline our analysis of existing data, and to increase the speed at which we are able to respond to changes in market dynamics." The letter said that AI could "assist [our] analysts with pricing, by reducing manual process, accelerating analyses and improving time-to-market for pricing adjustments." (Reporting and editing by David Shepardson, Chizu Nomiyama, and David Gregorio).

(source: Reuters)