Latest news with #Hauenstein
The Hill
a day ago
- Business
- The Hill
Airfare by algorithm: Delta leans into AI pricing — but is it a good thing?
What you pay for a Delta Air Lines ticket may soon depend less on timing and more on what an algorithm thinks you're willing to spend. About 3 percent of Delta's domestic ticket prices are now determined by artificial intelligence (AI), with plans to raise that to 20 percent by year's end, President Glen Hauenstein said on an earnings call last week. During an Investor Day presentation in November, Hauenstein described the new AI pricing technology as a 'super analyst,' calling it a 'full reengineering of how we price and how we will be pricing in the future.' That enthusiasm stems from the airline's partnership with Fetcherr, an Israeli tech company that uses AI to process millions of data points instantly 'to set the perfect price every time,' according to a company blog post. Delta's embrace of AI is the latest example of dynamic pricing, where companies adjust prices in real time based on factors like supply, demand and even individual consumer behavior. The concept isn't new, but the technology is making it far more sophisticated. Fetcherr's website says its algorithms tailor prices based on factors like customer lifetime value, past purchase behaviors and 'the real-time context of each booking inquiry,' all of which, the company says, help create 'a truly personalized offer.' In theory, hyperpersonalization meets customers where they are, offering a custom experience every time. But critics warn that the new pricing tactics may exploit rather than benefit consumers. Sen. Ruben Gallego (D-Ariz.) called Delta's practice 'predatory pricing,' in a post online, while accusing the airline of using AI to 'find your pain point' and 'squeeze you for every penny.' Last year, Wendy's planned to test an AI-driven dynamic pricing model that many likened to Uber's surge pricing. The plan faced intense backlash online before the burger chain clarified that menu prices would not increase during its busiest hours. It remains to be seen whether Delta will face similar pushback. Airlines already adjust fares based on seasonality and demand, so travelers may be accustomed to seeing wide price swings, with or without AI. NewsNation reached out to Delta for more details about its AI pricing strategy. In response, a spokesperson pointed to the company's latest earnings call. Early results suggest Delta's AI pricing strategy has successfully driven revenue, but it may still be some time before it's the norm. 'We're in heavy testing phase. We like what we see,' Hauenstein told investors. 'But we're going to take our time and make sure that the rollout is successful.'
Daily Mail
2 days ago
- Business
- Daily Mail
Delta Airlines shifts to AI-driven pricing strategy
Published: | Updated: Delta Airlines is letting AI take the controls — for pricing, that is. America's second-largest US airline by daily flights says it's expanding a pilot program that uses generative AI to help set fares. So far, just 3 percent of tickets have been priced with help from the bots. But consumer advocates are warning that the program could be 'predatory' for consumers and could spell the end of 'fair' pricing. The AI fare model has a projected runway of 18 to 24 months before a full-scale launch. If the tech lands smoothly , Delta says it could eventually hand over nearly all pricing decisions to its new digital co-pilot. Hauenstein said the AI is still in a 'heavy testing phase,' and reiterated the company will not rush the program out to its customers if issues arise. But, if successfully rolled out, the pricing model could represent a major departure from the traditional model used by the company for years. Delta previously relied on fixed and fair pricing models, where customers in similar seats largely paid the same price. Tickets were mostly determined by shared flight metrics like time, fuel prices, route, and demand. Executives believe the new system will strike a smoother balance between customer budgets and airline profitability. But it might also make passengers in the same aisle pay wildly different prices. 'It's all about giving people more choice, more pricing options, and more products and services in every cabin,' Hauenstein said. But others are warning that this pricing model could be harmful for consumers. Arizona Democratic Senator Ruben Gallego called the practice 'predatory pricing,' adding, 'I won't let them get away with this.' 'For consumers, this means the era of "fair" pricing is over. The price you see is the price the algorithm thinks you'll accept, not a universal rate.' Delta declined to comment on this article. The AI announcement comes as Delta made some major news about its profits forecast. In April, the company pulled its financial guidance, saying the American economy was going through too much turmoil to determine how much money the company would make. At the time, Congress hadn't passed President Donald Trump's tax and spending bill, tariffs were still up in the air, and markets were balking at uncertainty. Ed Bastian, the company's CEO, said consumer confidence 'certainly took a big dip in the early part of the year and then again in April, after the Liberation Day announcements were made.' But now the company has reinstated its profit guidance after it beat Wall Street's expectations for the second quarter of the year. Still, the company is facing some customer headwinds. Delta said that domestic economy seat sales fell 5 percent in the previous quarter. It will cut some domestic flights from the schedule in August.
NDTV
3 days ago
- Business
- NDTV
Delta Airlines May Adopt AI Fare System: What It Would Mean For Travellers
Delta Airlines may soon become the first carrier to use artificial intelligence (AI) to set ticket prices. It will test the AI-driven pricing system over the next 18-24 months, the airline has said, as per The New York Post. If the AI technology yields positive results, Delta Airlines may implement it permanently, travel site View From The Wing reported. To get things started, the airline plans to use AI to set ticket prices for up to 20 percent of its domestic flights by the end of 2025. Delta Airlines President Glen Hauenstein said that the company was evaluating how ticket prices should be set up to offer more personalised and relevant options to each traveller. He added that the goal was to benefit the customer and offer the right ticket at the right price, as per View From the Wing. He said, "[It's] a full re-engineering of how we price, and how we will be pricing in the future," adding, "[It's to] get inside the mind of our consumer and present them something that is relevant to them, at the right time, at the right price." The airline earlier announced it would experiment with AI to set prices for 1 percent of its tickets based on how much the customer was willing to pay. So instead of offering a fixed price, the AI would suggest a fixed price customised as per each individual based on things like demand, timings and customer behaviour, reported the outlet. Mr Hauenstein told The Street, "What we have today with AI is a super analyst. We have an analyst that's working 24 hours a day, seven days a week, and trying to simulate in real time, given the same inputs that an analyst sees today, what should the price points be?" This implies that the pricing of one flight out of every five will be determined by an AI program that calculates the maximum amount that customers are willing to pay for their ticket. "We like what we see. We like it a lot, and we're continuing to roll it out," said Delta. For the seventh consecutive year, Delta Airlines was named the top US airline. It was also recognised as the nation's most reliable airline for on-time flights, according to The Points Guy.
Time of India
11-07-2025
- Business
- Time of India
Delta Airlines' shocking AI upgrade: It could soon set ticket prices based on what you can afford
What Is Delta's AI Pricing System? Who Built It? Live Events What Makes This AI Different From Normal Fare Algorithms? Is the AI Working For Delta? What's an 'Offer Management' System? FAQs (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel If you've ever paid more than your friend for the exact same Delta flight, the reason might be something much smarter and high-tech than just happening by chance because the culprit is artificial intelligence, as per a Air Lines is in the process of using a powerful AI-driven pricing system that could make airfare more personalized than ever before, as per an Investopedia the company's 2024 Investor Day and the second-quarter 2025 earnings call, Delta President Glen Hauenstein revealed that Delta Air Lines is currently using an AI pricing tool on 3% of domestic flights and now plans to expand it to 20% by the end of the year, according to the READ: AeroVironment and Kratos share prices surge over 10% after Pentagon's surprise drone buying spree The AI technology, which is developed by Israeli tech company Fetcherr, is designed to predict exactly how much a customer is willing to pay and set ticket prices accordingly, as reported by described the new AI tool as a 'super analyst' that never stops working, according to the report. It doesn't just look at supply, demand, or travel dates, instead, it analyses data to predict each individual customer's maximum acceptable price, as per the report.'The more cases we give it, the more it learns,' Hauenstein said during Thursday's earnings call, reported Investopedia. While still in a heavy testing phase, the AI is already shaping pricing decisions and will become a central part of Delta's future strategy, as he even said at the company's Investor Day in November that it is ushering in 'a full reengineering of how we price,' as quoted by READ: Want to moonlight and double your income? Head to this Chinese province offering incentives to side hustlers As per a transcript made available by AlphaSense, Hauenstein said in November that 'The initial results show amazingly favorable unit revenues,' reported Investopedia. While Fletcherr had said at a 2022 conference that its product had been shown to boost revenue 9%, Investopedia reported, citing the travel site One Mile at a expects that Fetcherr will set prices and determine how many seats are available at those prices, which eventually will create what Hauenstein called an 'offer management' system, reported said in November that, 'We will have a price that's available on that flight, on that time to you, the individual–not a machine that's doing an accept-reject, and a static price grid,' as quoted in the READ: NIO stock surges over 4% after Morgan Stanley says Buy following new SUV Onvo L90 launch To maximize revenue by offering each customer the highest price they're likely to accept, based on personal data and behavior especially if the AI predicts that one traveler is willing to pay more than the other, as per the report.
Yahoo
11-07-2025
- Business
- Yahoo
AI May Determine the Price of Your Next Delta Ticket
Delta is using AI to set prices for 3% of domestic flights and plans to ramp this up to 20% by the end of the year, President Glen Hauenstein said Thursday. The tool, from the company Fetcherr, is designed to identify the maximum an individual would pay for a ticket. Fetcherr is helping Delta do a "full reeingineering" of how it prices, Hauenstein said at the company's Investor Day in to snag the cheap Delta ticket everyone else on your trip got? AI might be to blame. Delta Air Lines (DAL) uses an AI pricing tool on 3% of domestic flights and aims to apply it to 20% by the end of the year, President Glen Hauenstein said on an earnings conference call Thursday. Delta is incrementally deploying technology designed to identify the maximum a traveler will pay because 'the more cases we give it, the more it learns,' Hauenstein said. Though technically in a 'heavy testing' phase, the AI tool—from the Israeli company Fetcherr—figures into Delta's plans. Fetcherr functions like a constantly-on 'super analyst' and is ushering in 'a full reengineering of how we price,' Hauenstein said at the company's Investor Day in November. 'The initial results show amazingly favorable unit revenues,' Hauenstein said in November, according to a transcript made available by AlphaSense. (Fletcherr said at a 2022 conference that its product had been shown to boost revenue 9%, as reported by travel site One Mile at a Time.) Delta wants Fetcherr to set prices and how many seats are available at those prices—eventually creating what Hauenstein called an 'offer management' system. 'We will have a price that's available on that flight, on that time to you, the individual–not a machine that's doing an accept-reject, and a static price grid,' Hauenstein said in November. After soaring on better-than-expected results Thursday, Delta shares were recently off by about 2% and have fallen 8% so far this year. Read the original article on Investopedia Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
