(Nexstar) — With growing concerns over economic instability and global tensions, several major tourist destinations across the nation are fretting about potential lower attendance this year. However, travel experts suggest that if the demand decreases significantly, you might benefit from better offers and discounts as these locations try to attract more guests.
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 hesitancy to reserve 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
Reports indicated that international visits decreased by 14% in March compared to the previous year. The largest declines came from travelers originating in Canada and Western Europe, according to the organization.
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 news 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 noted in his report for clients. “This could indicate 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 for the U.S. economy amounting to billions of dollars.
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 rates to attract more customers.
Airfare dropped in February and March, according to
Labor Department monitoring
.
The fares haven’t been as robust as they were during the fourth quarter of last year 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 levels we 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 determine whether the typically bustling spring break and Easter travel periods also experienced price decreases.
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 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 effect tends to be quite pronounced for items considered luxuries by many families, such as travel. For example, airfare typically sees declines in pricing leading up to and throughout 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 to this report.
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