(Nexstar) – With growing concerns about economic instability and global tensions, many popular tourist destinations across the nation are fretting over potential lower attendance this year. However, travel experts suggest that if demand significantly decreases, you might benefit from better deals as these locations try to attract guests.
Where is tourism declining?
A
Las Vegas tourism report
Released earlier this week indicated that both visitation 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.
Due to the decline in travel demand, leading U.S. airlines are cutting back on their flight schedules and adjusting or canceling their financial forecasts 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 progressed into February,” said American Airlines CEO Robert Isom to CNBC.
Customer hesitation about scheduling trips would align with
a new poll
That indicated numerous individuals are afraid the U.S. is under threat.
steered into a recession
Moreover, President Donald Trump’s extensive and inconsistently applied tariffs will lead to increased costs.
The decrease in visitors includes both locals and international tourists.
U.S. Travel Association
International visits decreased by 14% in March compared to the previous year. According to the report, the most significant declines came from travelers originating in Canada and Western Europe.
Michael Feroli, chief U.S. economist at J.P. Morgan, said the travel drop-off could be due to growing anti-American sentiment.
“In recent weeks there have been numerous news stories about tourists canceling trips to the U.S. in protest of the perceived heavy-handedness of recent trade policies,” he wrote in a client note. “This points to potentially another channel to consider in assessing the effects of tariffs on economic activity.”
Even a relatively small drop in foreign tourism, whether it’s because of boycotts or economic uncertainty, would cost the U.S. economy billions,
Bloomberg
reports.
Will the drop in tourism result in travel deals?
Should demand decrease within the travel industry, airlines, hotel chains, and similar businesses might reduce their prices in an attempt to attract more customers.
Airfares fell in February and March, as reported.
Labor Department monitoring
.
The ticket prices haven’t been as robust as they were during the final 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 pinnacle many expected would persist from last year.
Before jumping to too many 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 also exhibited price decreases.
Nonetheless, airline business writer
Brian Summers
told The New York Times, “On the whole, I expect prices will fall and we will see more empty seats.”
If we see the U.S. economy tip into an economic recession this year, that could also make travel — and other goods and services — cheaper.
Indeed, during the 2008 economic 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 noticeable in items considered luxuries for many families, such as travel. For example, airfare typically sees reduced prices leading up to most recessions. If another recession were to occur, I believe we’d witness similar trends.
Nexstar’s Addy Bink and the Associated Press provided contributions for this report.
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