(Nexstar) — With rising economic concerns and growing global tensions, several major tourist destinations across the nation are fretting about potential visitor shortages this year. However, travel experts suggest that if demand falls significantly, you might benefit from better offers as discounts may become more prevalent.
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.
Consumer hesitance to make travel reservations 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 visitors includes both domestic and international tourists.
U.S. Travel Association
International visits decreased by 14% in March compared to the previous year’s figures, according to reports. The report highlighted significant declines in travelers coming from Canada and Western Europe.
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, several articles have highlighted how tourists are cancelling their visits to the U.S. as a response to what they see as overly strict new trade regulations,” he noted in his client communication. “This could be an additional factor we should take into account when evaluating the impact of these taxes on overall economic actions.
A modest reduction in international travel, triggered by either boycotts or financial instability, could result in significant losses for the US economy amounting to billions of dollars.
Bloomberg
reports.
Will the drop in tourism result in travel deals?
Should demand decline within the travel industry, airlines, hotel groups, and similar businesses might reduce their rates to attract more customers.
Airfares fell in February and March, as reported.
The Bureau of Labor Statistics monitoring
.
Alaska Airlines CFO 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 noted, “While demand remains robust across our sector, it hasn’t reached the elevated levels we expected would persist from last year onwards.”
Before jumping to conclusions, several industry analysts recommend holding off until the April data comes out to determine 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 as well as various other products and services.
In reality, during the 2008 downturn, there were several months when deflation occurred, causing the general price level to drop,” explained Tyler Schipper, an associate professor of economics at the University of St. Thomas. “This effect tends to be especially noticeable for items considered somewhat luxurious for many families, such as traveling. For example, airfare typically sees decreases in pricing leading up to most economic slumps. If another recession hits, I expect we’d observe similar trends.
Nexstar’s Addy Bink and the Associated Press contributed to this report.
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