(NEXSTAR) — With growing concerns over economic instability and global tensions, many popular tourist destinations across the nation are concerned about a potential shortage of 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 visitor numbers and hotel occupancy rates decreased compared to last year. This was revealed by California’s tourism board.
reported steep drop-offs
beginning in February and March.
Due to the decrease in travel demands, 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 hesitancy to schedule 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 travelers includes both domestic and international visitors.
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, who leads the U.S. economics team at J.P. Morgan, suggested that the decline in travel might be attributed to an increase in negative feelings toward Americans.
Over the past few weeks, many articles have highlighted how tourists are cancelling their visits to the U.S. due to objections over what they see as overly strict new trade measures,” he stated in his report for clients. “This suggests an additional factor we should take into account when evaluating the impact of these duties on overall economic performance.
A modest decrease in international travel, stemming from either boycotts or financial instability, could result in significant losses amounting to billions for the U.S. economy.
Bloomberg
reports.
Will the decrease in tourism lead to better travel offers?
Should demand decrease within the travel industry, airlines, hotel chains, and similar businesses might reduce their prices in an effort to attract more customers.
The cost of airfares decreased in both February and March, as reported.
Labor Department monitoring
.
The fares haven’t been as robust as they were during the fourth quarter of last year and extending into January and early February,” said Alaska Airlines Chief Financial Officer Shane Tackett to CNBC. “While demand remains very strong across the sector, it hasn’t reached the zenith that many 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 experienced 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.
“Indeed, during the 2008 recession, there were several months when we observed deflation as the general price level dropped,” explained Tyler Schipper, an associate professor of economics at the University of St. Thomas. “This phenomenon tends to be quite pronounced for items considered somewhat luxurious for many families, such as travel. For example, airfare typically sees reductions in pricing leading up to and during most economic downturns. If another recession occurs, I believe we will witness similar trends once more.”
Nexstar’s Addy Bink and the Associated Press provided contributions for this report.
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