While Delta experiments with AI fare models, American Airlines CEO Robert Isom says the move risks customer trust
Stefani Reynolds/AFP via Getty Images
Is American Airlines policing the pricing war — or just playing catch‑up? On an earnings call this week, American Airlines CEO Robert Isom took aim at Delta’s recent AI-powered fare strategy, saying that opaque AI tactics risk alienating consumers who expect honest, transparent pricing.
“Consumers need to know that they can trust American,” Isom said. “This is not about bait and switch. This is not about tricking. Others that talk about using AI in that way — I don't think it's appropriate. And certainly, [at] American, it’s not something we will do.”
Isom doubled down, emphasizing that while American Airlines would attempt to leverage AI for operational efficiency — such as improving customer service and optimizing flight schedules — it would never use the technology to exploit customers or make them pay more. He added that “some of the things I’ve heard [about AI use] are just not good.”
On a recent earnings call, Delta’s president, Glen Hauenstein, said the company has rolled out its AI-powered pricing on a small portion (about 3%) of its domestic routes and is aiming to expand its AI use to 20% of its network by the end of the year. The technology, designed to adjust ticket prices based on demand and customer profiles, has been praised by the company for its potential to maximize revenue. However, the technology has also raised eyebrows — especially among competitors and lawmakers.
U.S. Senators Ruben Gallego, Mark Warner, and Richard Blumenthal have demanded answers from Delta. In a letter made public on Tuesday, the three wrote, “Delta’s current and planned individualized pricing practices not only present data privacy concerns, but will also likely mean fare price increases up to each individual consumer’s personal ‘pain point’ at a time when American families are already struggling with rising costs.”
Delta has since tried to walk back some of Bastian’s comments, saying the company is just experimenting with AI to refine its dynamic pricing model — a tactic airlines have relied on for years to adjust fares depending on demand, timing, and other factors. The airline stressed that the technology isn't being used to tailor prices based on customer data, maintaining that all passengers see the same fares across all platforms.
“There is no fare product Delta has ever used, is testing, or plans to use that targets customers with individualized offers based on personal information,” the airline said in a statement. “A variety of market forces drive the dynamic pricing model that’s been used in the global industry for decades, with new tech simply streamlining this process.”
Join 500,000+ readers who start their day with Quartz.
By subscribing, you agree to our Terms of Service and Privacy Policy.
