Amid economic uncertainty, New Mexico's tourism businesses 'cautiously optimistic' for the summer season

Yahoo

18-05-2025

May 18—Tammy Stevenson and her coworkers from Virginia were curiously examining shelves full of alebrijes — colorful Mexican folk art sculptures or figurines — at Oaxacan Zapotec Traditions in Old Town on Wednesday when shop worker Havana Gallegos explained, "They're like a spirit guide."
"I'm trying to find the goofiest one," Stevenson, 54, said before telling Gallegos it was a conference that brought them to New Mexico.
"We absolutely love it," Stevenson said.
Stevenson is among millions of tourists who visit the state each year. Tania Armenta, CEO of Visit Albuquerque, said tourism is "a vital economic driver" for Albuquerque, contributing more than $2 billion and 45,000 jobs to the local economy.
However, the organization and tourism-based small businesses across New Mexico are anticipating a slower summer season compared to years past — a development they attribute to increased competition across destination hotspots and economic uncertainty.
According to recent hotel stay data from Visit Albuquerque, hotel occupancy for the first quarter of 2025, January through March, was down by 3% compared to the first quarter of 2024.
Economic uncertainty was a theme in data presented in a recent National Small Business Association report, showing that nearly two-thirds of small businesses say it is the top challenge their business is facing.
Periods of economic uncertainty have historically pushed consumers to spend less, though data and research in recent years show consumers are increasingly spending more, even as inflation continues and proposed tariffs under the Trump administration pose many unknowns.
But while they're spending, consumers are being pickier with their purchases and aiming to get more bang for their buck.
Such is the case for George Cook, owner of Old Town's Covered Wagon souvenir shop, and Nancy Ouimet, owner of Santa Fe's Canyon Road Contemporary Art gallery. The two say visitor numbers seem to be on track as this tourism season gets underway, but visitors are gripping their wallets a little tighter than usual.
"I do notice that people are buying lower-priced products. They're not spending big amounts of money," said Cook, who owns numerous tourism-based businesses in Albuquerque, Clines Corners and Taos. "They're still buying goods, but they're watching their money a little closer."
Ouimet, who has owned the Santa Fe gallery for 15 years, said she's seeing a similar trend. Some people are still buying art, but "nobody is actually making purchases that are larger than, say, $3,000," she said.
With gallery pieces priced from $50 to $50,000, Ouimet said visitors are happy to talk about the art, but few are making luxury purchases.
"Visiting numbers are on par with what we had last year, but sales are way down," Ouimet said.
Jesse Herron and Mike Silva, co-owners of TourABQ, said they expect the uncertainty to have more prolonged effects for their business' tourist season, which spans April through October — particularly for international travelers.
"People are not going to be coming to America to take tours if they don't feel welcome, and they don't," Silva said, referencing strong immigration stances under the Trump administration.
"We've definitely seen that already, and it's going to continue throughout the rest of the year," Herron added.
Herron's prediction aligns with recent data estimating that the United States may lose $12.5 billion in travel revenue in 2025. The data, released by the World Travel & Tourism Council, shows that visitor spending in the U.S. is estimated to fall to under $169 billion by the end of the year, a 7% drop from last year.
TourABQ is the parent company of many local tourism-based businesses, including ABQ Trolley Co., Albucreepy Ghost Walk, Duke City Pedaler and ABQ in a Box.
While international visitors account for roughly 10% of tours offered by TourABQ, Silva said their international customers usually spend more and leave reviews more often than domestic tourists do.
"The best years we've ever had as a company have been when we've had huge international tourism numbers," Silva said. "... Even if they were 10% of our ridership, that's 10% that's now kind of gone."
In order to fill seats that otherwise would have been filled by international riders, the owners have implemented a new business strategy for this season: reviving and boosting tours geared toward locals and domestic tourists.
While the owners are "cautiously optimistic" about this season, Herron said, how long they've been successful in business gives them confidence heading into this tourism season.
"We're just going to continue to do what we do, which is showcase the best of what Albuquerque has to offer ... and just hope that people are still anxious to get out and see this city," Herron said.
Armenta said Visit Albuquerque and the state's tourism department have many resources and tools available for supporting tourism-based small businesses, adding that she encourages business owners involved in the visitor economy to plug into those offerings.
"We know how important this industry is to our community and (our) focus (is) on resilience as we move through this year," Armenta said.
Business owners say the state's tourism economy hinges on two important actions: shopping local and sharing the city's experiences with friends and family.
"The best way to be reminded what an amazing community that we live in is to get out and about and to be a visitor in your own community," Armenta said.