Travel tech association warns of US crackdown on dynamic pricing

Major travel tech companies claim proposals to regulate AI-driven dynamic pricing by up to 20 US state legislatures will “raise operating costs and increase prices”.

The Travel Technology Association, whose members include Airbnb, Booking, Expedia, Skyscanner, Amex GBT and GDS owners Amadeus, Travelport and Sabre, has warned that state lawmakers “across the country” are “advancing ‘price surveillance’ bills aimed at restricting algorithmic and AI driven pricing” and limit or prohibit use of consumer search data in pricing. 

This comes amid growing demands for regulation following “federal scrutiny of ‘surveillance pricing’”.

Travel Technology Association chief executive Laura Chadwick described travel as “dependent on real-time pricing tools” and said: “Nearly 20 states have introduced proposals that would restrict or even ban the use of algorithms and AI in pricing.”

She claimed: “The impact would be severe. Dynamic pricing is essential for managing travel. These bills would undermine the industry’s ability to align prices with real time market conditions.” 

Chadwick argued: “The travel industry should be paying close attention.

“State lawmakers are moving quickly on a new wave of ‘price surveillance’ bills. The result would be higher operational costs, less efficient revenue management and a shift toward one-size fits all pricing that ultimately harms consumers.”

She warned “higher operating costs may likely result in higher prices” and said the association “is working to ensure policymakers understand the real-world consequences before lasting damage is done”.