Delta Air Lines is set to expand the use of artificial intelligence to determine airfare after testing a pilot program which used AI to set 3 percent of the airline’s airfare, but privacy advocates and government officials are concerned that it could lead to price hikes and discriminatory pricing.
The airline was one of the first to consider using AI to determine airfare, a measure that was announced back in 2023 by the airline’s president, Glen Hauenstein. They’ve partnered with Israeli company Fetcherr to use AI to set prices.
According to Fortune, Hauenstein told investors during the latest financial call that Delta will expand the use of AI from setting 3 percent of ticket prices to 20 percent by the end of the year, with a goal of doing away with static pricing altogether.
“This is a full reengineering of how we price and how we will be pricing in the future,” he said on the call. Eventually, he told investors, “we will have a price that’s available on that flight, on that time, to you, the individual.”
Yet what does that mean, exactly?
While Delta maintains that their fares are public and based on trip-related factors, travel websites have a history of changing fares based on factors like web browser or ZIP code.
The expansion of AI into determining fares, some critics say, could end fair pricing because travelers will never see a universal rate, only the rate that the AI algorithm predicts a traveler will pay based on a variety of factors about that specific traveler.
“They are trying to see into people’s heads to see how much they’re willing to pay, Justin Kloczko, who analyzes so-called surveillance pricing for California nonprofit Consumer Watchdog told Fortune. “They are basically hacking our brains.”
There are laws protecting consumers from being charged different rates based on their sex or ethnicity, but Consumer Watchdog and others warn that pricing could become predatory for people of different classes.
Lawmakers are also taking note. Senator Ruben Gallego (D-AZ) tweeted this message about it on X on July 15: “Delta’s CEO just got caught bragging about using AI to find your pain point — meaning they’ll squeeze you for every penny. This isn’t fair pricing or competitive pricing. It’s predatory pricing. I won’t let them get away with this.”
The integration of AI into businesses and travel brands has been a conversation topic that repeatedly returns to the issue of ethical implementation as worries about it replacing people’s jobs and stealing protected information becomes top of mind.
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