(Nexstar) — With growing concerns over economic instability and global tensions, many popular tourist destinations across the nation fear they might see fewer visitors this year. However, travel experts suggest that if demand significantly decreases, you might benefit from better offers and discounts as these locations try to attract travelers.
Where is tourism declining?
A
Las Vegas tourism report
Released earlier this week indicated that both visitor numbers and hotel occupancy rates decreased compared to last year. This data comes from California’s tourism board.
reported steep drop-offs
beginning in February and March.
As a result of dropping travel demand, major U.S. airlines are reducing their flight schedules and revising or withdrawing their profit outlooks for the year.
“We concluded with a robust fourth quarter, experienced reasonable activity in January, but noticed a significant decline in domestic leisure travel as we moved into February,” said American Airlines CEO Robert Isom to CNBC.
Customer hesitation about scheduling trips would align with
a new poll
that showed many people fear the U.S. is being
steered into a recession
Moreover, President Donald Trump’s extensive and inconsistently applied tariffs will lead to increased costs.
The decrease in travelers includes both local and international visitors.
U.S. Travel Association
Reports indicated that international visits decreased by 14% in March compared to the previous year. The largest declines came from travelers originating in Canada and Western Europe, according to the organization.
Michael Feroli, who leads the U.S. economics team at J.P. Morgan, suggested that the decline in travel might be attributed to increasing hostility toward Americans.
Over the past few weeks, many articles have highlighted how travelers are cancelling their visits to America as a reaction against what they see as overly strict new trade measures,” he noted in his report for clients. “This suggests we should also take into account this additional avenue when evaluating the impact of taxes on business.
A modest decrease in international travel, stemming from either boycotts or financial instability, could result in significant losses totaling billions for the U.S. economy.
Bloomberg
reports.
Is the decrease in tourism likely to lead to better travel offers?
Should demand decline within the travel industry, airlines, hotel chains, and similar businesses might reduce their prices in an attempt to attract more customers.
The cost of air travel decreased in February and March, as reported.
Labor Department monitoring
.
The ticket prices have not been as robust as those during the fourth quarter of last year extending into January and early February,” said Alaska Airlines Chief Financial Officer Shane Tackett to CNBC. “While demand remains elevated across the sector, it hasn’t reached the zenith we expected would persist from last year.
Before jumping to conclusions, several industry analysts recommend holding off until the April data comes out to evaluate whether the typically bustling spring break and Easter travel periods exhibited similar decreases in prices.
Nonetheless, airline business writer
Brian Summers
stated to The New York Times, “Overall, I anticipate that prices will drop, and we’ll notice more unoccupied seats.”
Should the U.S. economy slide into a recession this year, it might lead to lower prices for travel as well as various other products and services.
“Indeed, during the 2008 downturn, we observed deflation for several months when the general price level dropped,” explained Tyler Schipper, an associate professor of economics at the University of St. Thomas. “This phenomenon tends to be especially pronounced for items considered somewhat luxurious for many families, such as travel. For example, airfare typically sees reduced prices leading up to most economic slowdowns. If another recession were to occur, I believe we’d witness similar trends once more.”
Nexstar’s Addy Bink and the Associated Press provided contributions to this report.
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