Delta Air Lines is testing a new AI pricing system that tailors fares to individual customers, a move that could reshape how airline tickets are sold and priced. The system, developed in partnership with Israeli startup Fetcherr, is already being used on 3% of Delta’s flights, with plans to expand it to 20% by the end of the year. Personalized pricing — or surveillance pricing as the Federal Trade Commission (FTC) calls it — is pricing tailored to the individual based on the personal data collected. That’s different from dynamic pricing, which is determined by market factors such as real-time supply and demand and pricing by competitors. While the price changes, everyone sees the same price at a given time. Airlines, ride-sharing and other companies already use dynamic pricing. In a nutshell, dynamic pricing changes based on when a consumer buys. Personalized pricing changes based on who the consumer is. Delta seeks to gain a “first-mover advantage,” President Glen Hauenstein added. “We do believe that we are ahead of our competitors in terms of implementing this and in changing our business processes and rules around it.” Ultimately, this is “a full reengineering of how we price — and how we will be pricing in the future,” Hauenstein said.