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US Transportation Department Probing Potential Use of AI for Personalized Airfares

By  |  August 5, 2025

The U.S. Department of Transportation is closely monitoring how airlines use artificial intelligence in pricing, following concerns that the technology could be deployed to tailor fares to individual passengers. Transportation Secretary Sean Duffy said Tuesday the agency would take swift action against any carrier that attempted such a practice, according to Reuters.

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    “To try to individualize pricing on seats based on how much you make or don’t make or who you are, I can guarantee you that we will investigate if anyone does that,” Duffy stated. He added that Delta Air Lines has assured officials it does not and will not use AI to determine ticket prices for individual consumers. Per Reuters, Duffy said he was willing to accept that assurance “at face value.”

    The remarks follow public speculation from Democratic Senators Ruben Gallego, Mark Warner, and Richard Blumenthal, who suggested late last month that Delta might use AI to set fares for each passenger, potentially charging up to a person’s “pain point” threshold.

    Delta has confirmed it intends to roll out AI-driven revenue management tools — developed in partnership with pricing technology company Fetcherr — to 20% of its domestic network by the end of 2025. According to Reuters, Fetcherr advertises its services as being “trusted by the world’s leading airlines,” naming Delta, Westjet, Virgin Atlantic, Viva, and Azul among its partners.

    While Delta maintains that dynamic pricing has been part of the airline industry for more than 30 years — with ticket costs fluctuating due to demand, fuel costs, and competition — the company insists that such systems do not draw from personal consumer data. American Airlines CEO Robert Isom has also warned that relying on AI to set individual ticket prices could damage customer confidence.

    In Congress, Democratic Representatives Greg Casar and Rashida Tlaib have introduced a bill aimed at prohibiting the use of personal data in setting prices or wages. The legislation would specifically forbid airlines from raising fares after detecting sensitive search activity, such as inquiries related to family emergencies.

    Source: Reuters