Delta Airlines increases use of AI for ticket pricing, raising questions and curiosity in the market

Delta Air Lines is preparing to intensify its use of artificial intelligence (AI) in airline pricing. This change was discussed by company executives during its 2024 Investor Day, and according to Delta President Glen Hauenstein, the airline plans to use AI to determine prices more dynamically and efficiently. With Delta expected to implement this technology across 20% of its operations by the end of 2025, the approach raises questions about its implications for consumers. Delta is collaborating with the Israeli company Fetcherr, which has developed a pricing engine capable of granularly forecasting demand and applying frequent pricing methods, similar to those used in financial markets and e-commerce. The use of AI for pricing is not entirely new, as airline revenue management already uses automation to handle a multitude of fare combinations. However, the introduction of a more aggressive AI-based pricing strategy could result in significant changes in market behavior. Fetcherr, for example, claims to have observed a 9% increase in revenue during testing phases, as well as a 60% reduction in manual processes. On the other hand, personalized pricing raises concerns about price discrimination, where factors such as customer loyalty status, such as loyalty level with Delta, could influence the final ticket price. There’s also the possibility that this new strategy could lead to more attractive offers to fill empty seats, but how this will be implemented on price comparison platforms and online travel agencies remains to be seen. Ultimately, it is all part of a constantly evolving market, where demand and supply will determine prices. – https://aeroin.net/delta-airlines-aumenta-uso-de-ia-para-precificacao-de-passagens-levantando-duvidas-e-curiosidade-no-mercado/