AI dominates travel industry investment

Generative artificial intelligence has been a hot topic in travel for more than a year now, but what of the industry’s longer term relationship with AI?

Lufthansa Innovation Hub (LIH) has looked into the investment strategies of 60 corporations in travel to uncover whether investment in the technology is in line with the excitement about it from the technology industry more widely.

To assess the investment level, the innovation hub’s research arm TNMT gathered investment data on 60 corporations in travel and mobility technology and filtered out investments into companies that were not based on a specific key technology. 

The study, which cuts across hospitality, ground transportation, aviation and online travel, reveals that from 2018 to 2023 AI and machine learning represented 65% of investment.

The analysis goes on to find that the AI focus goes across several areas, including autonomous driving, predictive analytics and customer support.

Investment in AI for customer support has been one of the more obvious areas in recent months, but talk has increased of predictive analytics, particularly in aviation.

The TNMT report revealed that investments in this area are “targeted at companies enhancing process optimization using AI and ML algorithms.”

The study also revealed that the investment focus on AI has been at around 60% or greater every year since 2018.

When it comes to generative AI, TNMT said that a minority of companies have begun to explore its potential.

“To date, roughly a dozen notable investments have been made in this area, spread across four primary application fields,” it said.

In addition to customer support, the report highlighted analytics and fraud detection, industrial and maintenance operations.

TNMT also flagged some of the AI companies that are receiving the investment including UrbanFox, which has JetBlue Ventures as an investor for analytics and fraud detection; nlx, used by Copa Airlines in customer support; and sparkcognition, which has worked with Boeing in industrial. 

A number of travel companies jumped into AI last year by buying companies outright. Airbnb acquired GamePlanner.ai in November with Mondee making its move on Purplegrids about a week later.