Will Dropping Tourism Rates in U.S. Destinations Pave the Way for Cheaper Summer Travel?

(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 offers and discounts appearing 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 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.

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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. 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 objections over 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 taxes on overall economic performance.

A modest decrease in international travel, stemming from either boycotts or financial instability, could result in significant losses for the US economy amounting to billions of dollars.
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 to attract more customers.

Airfares fell in February and March, as reported.
The Bureau of Labor Statistics 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 noted, “While demand remains robust across the sector, it hasn’t reached the elevated levels we expected would persist from last year onwards.”

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Before jumping to too many 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 also exhibited 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 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 phenomenon tends to be especially noticeable for items considered somewhat luxurious for many families, such as travel. For example, airfare typically sees decreases in pricing during most economic recessions. If another recession hits, I expect we’d observe similar trends.

Nexstar’s Addy Bink and the Associated Press provided contributions for this report.

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