Fortune reports that Delta Air Lines will be doing away with fixed fares on its flights altogether and will instead start using AI to individualize its fare offers on a per-passenger basis. It’s one move as part of a long-term strategy to boost profitability.
AI will determine the highest possible price that each individual passenger is willing to pay for their flight ticket. Delta has been piloting the new pricing strategy over the last year, with 3 percent of the airline’s fares being set by AI. The results have been “amazingly favorable.”
Delta now aims to have 20 percent of all fares individually set by AI by the end of 2025. But in the long term, the plan is for AI to completely take over the pricing of Delta’s flight tickets.
The new pricing scheme has already faced a lot of criticism, with one consumer organization in California accusing the airline of more or less trying to “hack” passengers’ brains. However, there are certain laws that the AI must adhere to with its pricing, and US airlines are not allowed to charge differently for flight tickets based on gender or ethnicity.