(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 and discounts as these areas try to attract tourists.
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 hesitance 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 visitors includes both local and international tourists.
U.S. Travel Association
International visits decreased by 14% in March compared to the previous year’s data. 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 increasing hostility toward Americans.
Over the past few weeks, many articles have highlighted how tourists are cancelling their visits to the U.S. due to dissatisfaction with what they see as overly strict new trade measures,” he stated in his client memo. “This suggests we should take into account yet another factor when evaluating the impact of these duties on overall economic performance.
A modest reduction in international travel, triggered by either boycotts or financial instability, could result in significant losses for the U.S. economy amounting to several billion dollars.
Bloomberg
reports.
Is the decrease in tourism likely to lead to better travel offers?
Should demand decrease within the travel industry, airlines, hotel chains, and similar businesses might reduce their prices to attract more customers.
The cost of air travel decreased in both February and March, as reported.
The Bureau of LaborStatistics 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 would persist from last year onwards.”
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 as well as various other products and services.
“Indeed, during the 2008 downturn, we observed deflation for several months where 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 noticeable in items considered somewhat luxurious for many families, such as travel. For example, airfare typically experiences declines in pricing leading up to most economic recessions. 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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