LATAM adopts Sabre's intelligent solution Air Price IQ

Rhea-AI Summary

LATAM Airlines Group partners with Sabre to adopt Sabre Air Price IQ™, a cloud-native solution enabling dynamic pricing and personalized offers for travelers through AI and ML models.

Market Research Analyst

The introduction of Sabre Air Price IQ™ by LATAM Airlines Group represents a significant enhancement in the airline's pricing strategy. The adoption of a cloud-native solution that leverages AI to analyze shopping and revenue management data for real-time pricing adjustments could potentially lead to increased revenue through higher conversion rates and more personalized customer offers. From a market research perspective, the ability to dynamically adjust prices in response to market conditions is a competitive advantage. This technology could influence the broader industry trend towards personalized pricing strategies, where airlines differentiate themselves not just through routes and service but also through sophisticated pricing models.

However, the effectiveness of these AI-driven pricing tools will depend on the quality of the data and the algorithms used. If the system can accurately predict consumer behavior and optimal pricing, LATAM could see a positive impact on its bottom line. On the other hand, if the predictions are off, it could lead to customer dissatisfaction or revenue losses. For investors, the critical factor will be monitoring the performance outcomes of this new system, particularly as it relates to LATAM's financial metrics in subsequent quarters.

Financial Analyst

For stakeholders and investors in the airline and travel technology sectors, LATAM's move to implement Sabre's Air Price IQ™ could signify a shift towards more agile and data-driven business models. Financially, this could translate to improved margins if the system enables LATAM to optimize pricing and better match supply with traveler demand. The scalability of the solution implies that it could handle increased transaction volumes, which may be beneficial during peak travel seasons. Investors should watch for changes in LATAM's revenue per available seat mile (RASM) and yield, as these would be direct indicators of the system's impact on financial performance.

It's also important to consider the investment required to integrate such a system and whether the ROI justifies the expenditure. The initial costs may be offset by long-term gains in operational efficiency and customer loyalty if the system delivers on its promise. From a financial analysis viewpoint, the key will be to assess how this technology investment aligns with LATAM's broader strategic goals and its effects on market share and competitive positioning.

Technology Analyst

The technical aspects of Sabre's Air Price IQ™, particularly its use of AI and ML, are central to understanding its potential impact. The system's ability to process large volumes of data in real time to provide actionable insights could be a game-changer in how airlines approach pricing strategies. For the airline industry, which operates on thin margins and faces constant price-based competition, the adoption of such advanced technology solutions could be the differentiator between profitability and loss.

As a technology analyst, evaluating the robustness of the underlying AI models, the system's integration with existing IT infrastructure and its scalability will be crucial. The partnership with Google Cloud suggests a strong technical foundation, given Google's expertise in AI and cloud services. However, the long-term success of such a solution will also depend on continuous improvements and updates to the AI models to adapt to changing market dynamics. The broader implications for the industry include a potential increase in investment in similar technologies by other airlines, aiming to stay competitive in a market that is increasingly driven by data insights.

The cloud-native solution will allow the carrier to generate relevant offers by analyzing its own data in real time along with actionable marketplace insights

SOUTHLAKE, Texas, April 9, 2024 /PRNewswire/ -- LATAM Airlines Group and Sabre Corporation (NASDAQ: SABR), a leading software and technology provider that powers the global travel industry, today announced the carrier's adoption of Sabre Air Price IQ™, an intelligent solution that is part of Sabre's Retail Intelligence suite.

Powered by Sabre Travel AI™ technology, Air Price IQ allows airlines to generate relevant offers by analyzing an airline's own shopping and revenue management data in real time along with relevant marketplace insights. It also enables airlines to bring their own pricing models and define business rules and strategies to set boundaries for airfare pricing within the solution, empowering them to turn data and insights into actionable output.

Air Price IQ can also provide multiple benefits to airline customers like the optimization of air prices to help drive higher conversion rates and improved returns by delivering more relevant offers across different channels as it utilizes artificial intelligence (AI) and advanced machine learning (ML) models. 

"In today's competitive marketplace, it is crucial to offer travelers a more relevant travel experience. Our partnership with Sabre can help us bring the right offers to the right travelers at the right time by using intelligent systems like Air Price IQ," said Rosario Phillips, vice president of Customer and Commercial Solutions, LATAM Airlines Group. "The flexibility and scalability of Sabre's solution allows us to test and learn different pricing strategies, including using our own models, enabling us to move from static pricing to dynamic price, adapting quickly to fast-changing market conditions. It's an important step towards the future we envision for dynamic offers."

Considering customer segmentation and travel purpose, Air Price IQ supports airlines in their efforts to provide a seamless experience to its travelers while maximizing revenue opportunities. This cloud-native, scalable travel technology solution supports seasonal and time-of-day increases/decreases in shopping requests, allowing airlines to adjust their prices in real time based on capacity, competition and traveler context. Air Price IQ helps them improve pricing precision by analyzing marketplace, pricing and revenue management strategies, as well as booking velocity.

"LATAM has been a highly engaged partner that has collaborated in designing and providing feedback to our solution. We are excited to see the fruits and benefits of this partnership materializing with their adoption of Air Price IQ, as we share a commitment to innovation. The airline industry is constantly evolving, and airlines require intelligent systems to manage increased complexity and channel fragmentation to deliver a seamless, personalized experience to travelers while improving profitability," said Darren Rickey, senior vice president, Global Airline Sales, Sabre Travel Solutions. "Enabling airlines to dynamically price their airfares and offers based on the travelers' propensity to purchase, customer profile or current market conditions is key, and requires intelligent systems that analyze large volumes of data at scale to deliver actionable insights."

In partnership with Google Cloud, Sabre Travel AI™ provides AI solutions and automated machine learning tools that sense, analyze and predict consumer behaviors – using real-time shopping and sophisticated travel-specific business insights. Its capabilities enable airlines, agencies, corporations, hoteliers and other travel partners to take their retailing and digital customer experience strategies to the next level by delivering highly relevant and personalized content more quickly, to better meet the demands of today's traveler and create expanded revenue and margin growth opportunities.

About Sabre Corporation   
Sabre Corporation is a software and technology company that takes on the biggest opportunities and solves the most complex challenges in travel. The Company connects travel suppliers and buyers around the globe and across the ecosystem through innovative products and next-generation technology solutions. Sabre harnesses speed, scale and insights to build tomorrow's technology today – empowering airlines, hoteliers, agencies and other partners to retail, distribute and fulfill travel worldwide. Headquartered in Southlake, Texas, USA, Sabre serves customers in more than 160 countries around the world. For more information visit www.sabre.com.  

About LATAM Airlines Group S.A.
LATAM is Latin America's leading airline group, with presence in five domestic markets in South America: Brazil, Chile, Colombia, Ecuador and Peru, along with international operations within Latin America and to Europe, US and the Caribbean. The group operates a fleet including Boeing 767, B767F, B777, B787, Airbus A319, A320, A320neo and A321 aircraft, the most modern models of their kind. LATAM is recognized for its sustainable practices, based on three criteria: economics, social and environmental. In 2021, following the S&P Corporate Sustainability Assessment, LATAM was recognized as the most sustainable airline in the region and fourth worldwide, as well as being included in the 2022 Sustainability Yearbook in the Bronze category. Likewise, the group was part of the Dow Jones Sustainability Index for six consecutive years, being cataloged as one of the most sustainable in the world. The shares of LATAM Airlines Group are traded on the Santiago Stock Exchange. Due to its Chapter 11 filing, the ADR program is no longer listed on the NYSE and LATAM's ADRs are traded in the OTC (over-the-counter) markets. For further information, visit www.latam.com. For financial information: www.latamairlinesgroup.net.  

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Investor Contact:

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SOURCE Sabre Corporation

FAQ

What is the name of the intelligent solution adopted by LATAM Airlines Group from Sabre ?

LATAM Airlines Group has adopted Sabre Air Price IQ™, an intelligent solution that allows airlines to generate relevant offers by analyzing their own data in real time along with marketplace insights.

How does Air Price IQ enable airlines to set boundaries for airfare pricing?

Air Price IQ enables airlines to bring their own pricing models and define business rules and strategies to set boundaries for airfare pricing within the solution, empowering them to turn data and insights into actionable output.

What benefits does Air Price IQ provide to airline customers?

Air Price IQ provides benefits like optimizing air prices to drive higher conversion rates, delivering more relevant offers across different channels using AI and ML models.

How does Air Price IQ support airlines in providing a seamless experience to travelers?

Air Price IQ supports airlines in providing a seamless experience by analyzing marketplace, pricing, and revenue management strategies to improve pricing precision based on capacity, competition, and traveler context.

With whom has Sabre partnered to provide AI solutions and automated machine learning tools?

Sabre has partnered with Google Cloud to provide AI solutions and automated machine learning tools through Sabre Travel AI™, enabling travel partners to deliver highly relevant and personalized content more quickly.