(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 deals emerging as a result.
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 moved 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 drop in travelers is both domestic and foreign. The
U.S. Travel Association
reports international visits were down 14% in March when compared to the same month a year prior. The biggest drops were in visitors from Canada and Western Europe, the group said.
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.
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 to entice customers back.
Airfares fell in February and March, as reported.
Labor Department monitoring
.
Alaska Airlines Chief Financial Officer Shane Tackett informed CNBC, “The ticket prices have weakened compared to those in the final three months of last year extending through early February.” He further explained, “While demand remains robust across the sector, it hasn’t reached the elevated levels we expected following the previous year.”
Before jumping to conclusions, several industry analysts recommend holding off until the April data is published 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 observe more unoccupied seats.”
Should the U.S. economy slide into a recession this year, it might lead to lower prices for travel and various other products and services.
In reality, during the 2008 economic downturn, deflation occurred for several months with overall pricing levels dropping,” 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 decreases in cost leading up to most recessions. If another recession were to hit, I believe we’d observe similar trends.
Nexstar’s Addy Bink and the Associated Press provided contributions for this report.
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