(Nexstar) — With growing concerns over economic instability and global tensions, many popular tourist destinations across the nation are apprehensive about attracting visitors this year. However, travel experts suggest that if demand falls significantly, you might benefit from better deals 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.
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 progressed into February,” said American Airlines CEO Robert Isom to 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
Reports indicated that international visits decreased by 14% in March compared to the previous year. The organization noted 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, various reports have highlighted how many travelers are cancelling their visits to the U.S., objecting to what they see as overly strict new trade regulations,” he noted in his communication with clients. “This could indicate an additional factor we should take into account when evaluating the impact these taxes may be having on business operations.
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 drop in tourism result in travel deals?
Should demand decrease within the travel industry, airlines, hotel chains, and similar businesses might reduce their prices in an effort to attract more customers again.
Airfares decreased in 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 through early February.” He further noted, “While demand remains robust across the sector, it hasn’t reached the levels everyone expected would persist from last year onwards.”
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 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, 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 quite pronounced for items considered luxuries by many families, such as travel. For example, airfare typically sees declines in pricing leading up to most economic downturns. If another recession hits, I expect we’d observe similar trends once more.”
Nexstar’s Addy Bink and the Associated Press provided contributions for this report.
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