(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 decreases significantly, you might benefit from better deals as these locations try to attract 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 came off a strong fourth quarter, saw decent business in January, and really domestic leisure travel fell off considerably as we went into the February time frame,” American Airlines CEO Robert Isom told CNBC.
Customer hesitance 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 local and international tourists.
U.S. Travel Association
International visits decreased by 14% in March compared to the previous year at the same time. 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 suggests an additional avenue worth exploring when evaluating the impact of these taxes on overall economic action.
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 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.
The cost of airfares decreased in both February and March, as reported.
Labor Department 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 into January and 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 too many conclusions, several industry analysts suggest holding off until the April data comes out to evaluate 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 recession, 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 pronounced for items considered somewhat luxurious for many families, such as traveling. For example, airfare typically sees decreases in pricing leading up to most economic downturns. If another recession hits, I expect we’d witness similar trends once more.”
Nexstar’s Addy Bink and the Associated Press provided contributions for this report.
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