Airlines use AI pricing, reducing cheap seat options

Airlines are rapidly adopting artificial intelligence to set ticket prices, a shift that is narrowing the traditional gaps between cheap and expensive seats and making last-minute bargains on popular routes increasingly scarce. The technology, which analyzes dozens of variables in real time, allows carriers to continuously optimize fares to match demand, moving beyond older, slower methods like manual rules and spreadsheets.

Major airlines including Delta Air Lines and Virgin Atlantic are implementing these AI-driven systems, driven by pressures from rising labor, maintenance, and fuel costs. The core change involves replacing periodic human-led pricing cycles with predictive models that constantly recalibrate based on factors like historical booking patterns, current seat inventory, seasonal trends, and competitors' fares.

For travelers, the immediate effect is a dual-edged sword. On busy, high-demand routes, fares are likely to rise as airlines sell fewer seats below perceived willingness to pay and aim to fill planes closer to capacity. Conversely, the same technology can lead to lower fares on off-peak or less popular routes, as airlines use discounted pricing to stimulate...