American Airlines CEO Does Not Hold Back on Delta's Controversial Move

Earlier this week, Delta Air Lines President Glen William Hauenstein told reporters that the company was moving forward with expanding the use of AI in its pricing. However, American Airlines CEO Robert Isom is not a fan of that plan.

This week, Hauenstein told reporters that about 3 percent of the airline's domestic ticket prices are already set using AI, and the company hopes to expand that to 20 percent by the end of the year.

In his comments, Hauenstein also spoke highly of Delta's partnership with Fetcherr, a tech company that claims to be able to "set the perfect price every time" using AI.

"The convergence of AI, machine learning and real-time data processing completely transforms how airlines approach pricing strategy," a Fetcherr post on dynamic pricing in aviation reads. "Gone are the days of rigid pricing rules and manual adjustments. Welcome to the era of true dynamic pricing, where artificial intelligence can process millions of data points instantly to set the perfect price every time. Welcome to the modern age of AI dynamic pricing."

Some lawmakers have already expressed concerns about the move, citing concerns about privacy and "pricing discrimination." It sounds like Isom isn't a fan of the move, either.

"I don't think it's appropriate," Isom said during American Airlines' earnings call on Thursday, according to The Points Guy.

Isom went on to make it very clear that this is not something that American Airlines will pursue in the future.

"I quite frankly think that some of the things I've heard are just not good," Isom said.

"Consumers need to know that they can trust American, ok? This is not about bait and switch. This is not about tricking," Isom added. "And certainly, from American, it's not something we will do."

In the statement, Delta denied any plans to use personal information to target customers with individualized offers and claimed that the new AI technology is simply streamlining its process for setting its fares.

"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 or otherwise," the airline told Newsweek in a statement late Monday. "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. Delta always complies with regulations around pricing and disclosures."

Clearly, Isom does not think AI should be used in pricing air fares.