How airlines are using customer data and AI to develop dynamic ticket pricing algorithms based on what you can pay
Dec 5, 2024
After the U.S. Senate released a report last week criticizing the airline industry for embedding fees into nearly every aspect of the flying experience, top executives gathered in Washington, D.C., to defend their practices. When pressed on whether they would scale back efforts to extract additional revenue from consumers, the executives avoided giving clear answers about their future plans.
Key takeaways
- Delta Air Lines CEO Ed Bastian highlighted his company’s collaboration with Israeli artificial intelligence company Fetcherr to develop AI-driven pricing algorithms. “We have about 1% of our network currently being priced by the Fetcherr team. This is a complete overhaul of how we price today and how we will price in the future,” Bastian said;
- During the hearing, Senator Josh Hawley (R-Ark.) raised concerns about how airlines use customer data to set ticket prices. He asked, “Why do you require passengers to enter their age, geographic location and gender before they can even see the cost of a seat?”;
- In response, Klein denied that such personal information directly influences fare calculations, though he acknowledged the use of algorithms in pricing decisions. “That’s a different question,” he clarified.
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