Delta Air Lines plans to use AI to help the airline significantly improve its profitability by making smarter decisions across pricing, operations, and other areas of the business, CEO Ed Bastian confirmed.
“If we could take two, three, four points of our cost down from making smarter, better decisions over a series of several years — my gosh — you look at a margin at Delta, you go from a 10% margin to a 15% margin, it’s a 50% improvement in your profitability. These things are billions of dollars substantial,” said Bastian during Scott McCartney’s Airlines Confidential podcast.
View from the Wing’s Gary Leff, an expert in miles, points, and business travel, explained that the carrier aims to replace slow decisions made by employees with “constant machine-made decisions across pricing, upgrades, crew recovery, maintenance, fuel, and the back office.”
“…You can make better revenue decisions on how you manage different buckets. So I think the opportunity is there,” Bastian added.
“I think the issues of trust and governance are also really important, and that’s why I never refer to AI as artificial. I always call it augmented intelligence. It’s going to make our people smarter and better.”
Delta already faced scrutiny from lawmakers over AI use
In July 2025, I reported on how, during a second-quarter earnings call, Delta President Glen Hauenstein confirmed the carrier is partnering with tech startup Fetcherr to deploy AI-driven dynamic pricing solutions across its network.
The airline initially rolled out the AI pricing system across about 3% of its domestic network, with a goal of expanding the technology to about 20% by the end of 2025.
Related: A new low-cost airline is launching flights starting at $25
However, the rollout sparked intense political scrutiny. U.S. Senators Ruben Gallego, Richard Blumenthal, and Mark Warner sent a formal letter questioning whether the tool tracks individual browsing history or personal data.
“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,” the senators’ letter to Delta Air Lines reads.
Delta pushed back forcefully against those allegations.
In an official response to lawmakers, Delta stated: “There is no fare product Delta has ever used, is testing or plans to use that targets customers with individualized prices based on personal data.”
There’s a crucial distinction between dynamic pricing and pricing based on personal data. While senators warned against individualized pricing practices that analyze private consumer data to inflate fares, Delta maintains it relies solely on dynamic pricing: analyzing macro supply and demand across thousands of flights simultaneously to set a universal ticket price for everyone viewing that flight.
What Delta Air Lines’ AI-driven dynamic pricing means for consumers’ wallets
AI pricing isn’t just about charging you more. It can actually lead to cheaper tickets, Leff points out.
Airlines generally try to capture more revenue from travelers who are less price-sensitive while offering lower fares to more price-sensitive customers. Previously, it was challenging to distinguish between those different types of travelers when determining how much they were willing to pay.
AI might be able to simplify this. In theory, if the system predicts that a traveler will not buy a $500 ticket, it could recommend a lower fare, such as $275, to encourage a purchase.
In practice, this usually means the AI adjusts how many seats are available at each fare level, rather than showing two shoppers different prices for the same seat at the same moment. So if demand data suggests more price-sensitive travelers are searching for a route, the system can open up more $275 seats for everyone to see; it’s reallocating inventory, not tailoring a price to any one person.
“The airline earns more overall because it discounts where a discount changes behavior and avoids discounting where it does not. That lets airlines offer more discount fares to more people, because they can do so without offering them to people who will pay more,” Leff points out.
While Bastian has described a potentially significant profitability opportunity from AI, Leff suggests that Delta could be overestimating the eventual benefit. Leff argues that other airlines will likely adopt similar AI tools, if they haven’t already, potentially eroding any competitive advantage Delta gains from the technology.
“Other airlines will be doing exactly what Delta is doing — United shed 4% of management staff last year, and expects to do the same this year — and with a lower cost base that results will compete down price,” Leff concluded.
Related: TSA says ‘yes’ to medical marijuana on planes, but there’s a catch
