‘Save what we can': Economic uncertainty, Trump rhetoric hits US travel

Al Jazeera

a day ago

New York, US: Miguel Olave lives in a quiet suburb outside Wichita, Kansas, called Derby. Every year, along with his wife Alexis, Olave takes his four boys on a vacation somewhere around the United States, like Disney World or New York. This year, however, the family's annual tradition is on pause.
'We kind of decided a few weeks ago that we just weren't going to be doing a trip this summer because of all the unknowns,' Olave told Al Jazeera.
Olave said one of the reasons for the cuts in travel is the sheer cost of goods his family needs on a daily basis. Any extra income is no longer going towards indulgences like travel but towards the increasingly expensive grocery bill.
'Typically … by the 15th of every month, we're hitting around $350 to $400 in grocery expenses. This month, we're nearing $600,' Olave said.
As per data from the Bureau of Labor Statistics (BLS), while grocery prices have come down by 0.1 percent, the biggest drop in nearly five years, they are still 2 percent higher than at this time last year.
Amid uncertainty about how long the job market will hold steady for him, Olave, who works in marketing, feels it is best to save the money coming in rather than spend it on travel.
'We think it's just wise to, you know, buckle down and save what we can,' Olave said.
He is far from alone. With consumer confidence hitting a 13-year low, otherwise reliable travellers like Olave are not taking to the skies.
A survey of travel advisers by Travel Weekly, a travel industry publication, found that 57 percent of travel planners saw a decline in business, and 63 percent of advisers cited economic uncertainty as one of the top three reasons for travel hesitancy.
'It's very clear that consumers are waiting to make decisions, including for the summer,' Southwest Airlines CEO Robert Jordan said at the Bernstein Annual Strategic Decisions Conference in late May.
That trend is echoed in a Bank of America report, which shows that consumers are holding off on spending on lodging and flights. According to Flighthub, an online travel agency, bookings have declined by 10 percent compared with this time last year.
Travel booking site Expedia, in its first-quarter earnings report, showed that booking growth has stalled in the US, citing weaker domestic demand, a contrast to trends in the rest of the world.
'US demand was soft, driven by declining consumer sentiment,' said Ariane Gorin, CEO of Expedia, during an earnings call.
As a result of lower demand, flight ticket prices have tumbled. The BLS's most recent Consumer Price Index report, released on Wednesday, showed airline prices decreased by 2.7 percent in May following a 2.8 percent decline in April, a continuation of a trend from March's report, which showed a 5.3 percent decrease.
Even for those still opting to travel, according to a survey by MMGY, a tourism marketing agency, 24 percent are looking for cheaper modes of transport, and 22 percent are looking for shorter stays, all of which will help cut costs.
The flow of tourists to the US is also stemming, but more so because of rhetoric by US government officials and policies surrounding immigration and trans-rights than economic concerns.
Blaming it on the Trump administration's 'globally controversial and globally divisive … rhetoric and policy', Adam Sacks, the president of Tourism Economics, a division of Oxford Economics, an economic forecasting firm, said, 'If you start to go through a catalogue of issues, you've got the condescending rhetoric toward Canada as a 51st state, the posturing of taking over Greenland, even if by military force, the turning away from historic alliances, the perceived softening toward Russia, and then the trade war itself, which is combative, just by its very nature, and it becomes us versus them.'
'That really affected the perception. It affected the brand of the country and sentiment toward the country.'
According to the US Travel Association, international travel to the country declined by 14 percent overall in March. If this trend continues for the rest of this year, it could cost the US travel industry $21bn.
The most significant drop has been from Canada, as overnight land travel from the northern neighbour fell by 26 percent this March. Data from Statistics Canada shows a 35.2 percent drop in car return trips to the US in April compared with the same time last year. It was also the fourth month of year-over-year declines.
'Everywhere we look, we do see continued signs of a pullback in travel to the US,' Sacks added.
The Trump administration's immigration policies have also raised alarms among international travellers, fuelled by troubling stories of detention and deportation.
Jasmine Mooney, a Canadian actress, was held by US Immigration and Customs Enforcement (ICE) for 12 days when she went to the San Ysidro centre at the Mexico-US border to apply for her visa. German teenagers Maria Lepere and Charlotte Pohl were deported upon arrival in Hawaii for vacation, reportedly because they did not have a hotel reservation. And a French scientist was denied entry en route to a research conference near Houston after US officials found messages on his phone critical of the president.
US Vice President JD Vance also joked during a news conference on the upcoming FIFA World Cup, which the US is set to co-host in 2026, about deporting visitors for that event who overstayed their welcome.
One case that has spooked some foreign travellers is that of Kilmar Abrego Garcia, a Maryland resident who was deported and sent to a notorious mega-prison in El Salvador.
Initially, the administration claimed his deportation was an administrative error. Department of Justice records show no criminal convictions against him. However, officials later reversed course, asserting that he was a member of the international criminal gang MS-13, an accusation the US president tried to substantiate using a digitally altered image of Garcia's knuckles.
Another case that may have frightened travellers is that of Juan Francisco Mendez, the Massachusetts man who was detained by ICE in a case of mistaken identity.
A Mexican national who frequently visits the US for work and was on a trip to New York in April told Al Jazeera on condition of anonymity that it was his last trip for a while, citing stories like these as deterrents.
'I don't want to be walking down the street on the way to a business meeting, being mistaken for someone else and not being able to prove myself otherwise,' the traveller said.
This comes as the White House doubles down on its hardline immigration stance. Stephen Miller, White House deputy chief of staff for policy, known for his anti-immigration views, has said the Trump administration is considering suspending habeas corpus, the legal right that protects people from unlawful detention.
Although Miller claimed the move would target undocumented migrants, eliminating the legal framework could bar people from seeing a judge, challenging evidence or defending themselves, and could ultimately impact anyone on US soil.
Miller has justified the proposal by claiming that there is a migrant 'invasion'. However, undocumented migration to the US has actually been steadily declining for more than a year since March 2024, long before Trump took office.
'This administration's actions just really have injected a new level of apprehension for people visiting the United States, and definitely, sort of, led to more caution,' Noor Zafar, a senior staff lawyer for the Immigrants Rights Project at the American Civil Liberties Union (ACLU), told Al Jazeera.
'We've been advising people, especially those who are noncitizens, to make sure that they consult with a lawyer before they travel, or to at least have the number of a lawyer on hand for when they are at the airport and seeking to re-enter, just because there is just a heightened unpredictability about what's going to happen.'
Looking ahead, Oxford Economics forecasts that visits from Canada to the US could fall by as much as 20.2 percent this year. Overall, it projects a 9.4 percent decrease in international visitors in 2025, a stark contrast to December's forecast, which predicted an 8.8 percent increase.
Online communities of travellers have been vocal about avoiding the US, opting instead for destinations in Europe and Canada. Al Jazeera reached out to several of the posters, none of whom responded to interview requests.
Confirming the trend, Airbnb's chief financial officer, Ellie Mertz, said in an investor call that Canadian travellers were visiting the US less while spending more in Europe, Latin America, and Asia.
Hotel bookings are also falling sharply. HotelPlanner, a hotel booking platform, showed a 61 percent drop in US hotel bookings from international travellers in April, compared with the same period last year. The biggest declines came from the Canadian and British markets, 52 percent and 33 percent, respectively.
Air France-KLM has lowered prices on economy-class transatlantic flights. Air Canada's CEO, Mike Rousseau, noted a 'low teens' percentage drop in bookings to the US over the next six months during the company's recent earnings call. Both Air Canada and Air France-KLM declined to provide further comment.
'We think it's going to be pervasive and severe in the months to come,' Sacks said, explaining the decline in inbound travel.
Even the traditional allies, including the United Kingdom and Germany, have issued travel warnings related to visits to the US, citing policies that have created a more hostile atmosphere for foreign travellers.
Passengers are already noticing emptier flights.
'I don't know if I've ever seen a flight that empty,' said Garen Kazanc, a Los Angeles resident who recently travelled home from Rome.
Kazanc, a frequent flyer, said his family members who live in different countries across Europe are now reluctant to travel to the US due to safety concerns.
'It's kind of traumatic to see people getting kidnapped off the streets like that, especially when you're a noncitizen. If the country's not following the basic rules of its highest law, which is the constitution, you kind of get sceptical as a tourist to come visit the United States,' he said.
Zafar, the ACLU lawyer, added: 'There is a general level of fear about how much the ground has shifted in terms of what the government is going to try to do.'
The White House did not respond to Al Jazeera's request for comment.