Delta Air Lines has recently faced criticism over its use of an AI-driven pricing tool, with some accusing the airline of implementing “individualized pricing” based on personal data. This controversy was sparked by a letter from prominent US senators who expressed concerns about the potential misuse of customer data to set personalized fare prices. In response, Delta has firmly denied these allegations, clarifying that it has no intention of using any system that targets customers with personalized prices based on their personal information. Currently, the AI tool is being used on about 3% of Delta’s domestic routes, with plans to expand its use to 20% by the end of the year.
In a letter dated July 31, Peter Carter, Delta’s Chief External Affairs Officer, addressed the “confusion and misinformation” surrounding the AI tool, which was developed by Israeli tech company Fetcherr. Delta President Glen Hauenstein had previously praised the AI tool for its potential to enhance pricing strategies, but the rollout news led to public backlash. Despite media speculation that Delta might be using personal data like booking history or browsing habits to set individualized prices, the airline has clarified that the AI system is designed to optimize existing fare pricing using aggregated data. Carter emphasized that the AI tool is a decision-support system that provides insights for analysts, who then adjust recommendations to align with Delta’s business strategy.
Delta has also reiterated its commitment to fair pricing practices, stating that it has “zero tolerance” for discriminatory or predatory pricing. The airline ensures that its pricing complies with all relevant regulations, offering the same fares to all customers. Delta’s pricing is influenced by various factors, including customer demand, aggregated purchasing data, competitor offers, route performance, and jet fuel prices. Importantly, customers are not required to log in or provide personal information when booking tickets. The AI tool is intended to streamline and enhance Delta’s data analysis processes, making fare determination more efficient.
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Originally reported by Simple Flying Read More
