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The American erevenge travelf surge is over. Fear and uncertainty are big factors
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Francisco Ayala and his wife have canceled the cruise they planned to take to see the Northern Lights this year. The reasons are complicated.
Ayala is a natural-born US citizen, and his wife is a naturalized citizen. But given reports of people@even with legal status@being detained and questioned at US borders, Ayala said taking a trip out of the country for fun doesnft seem worth the potential risk.
Ayala also sees another problem: the economy. gThe writing is on the wall c The moment I saw the market volatility, Ifm like, eYep, this is not going to be good.fh
Travel advisers are seeing the impact of that uncertainty. More than 80% of the 460 advisers surveyed recently by TravelAge West were gveryh or gsomewhath concerned about the impact of a possible economic downturn on their business, and more than half were gveryh concerned about the impact of government policies.
Their clientsf top concern was economic uncertainty, followed by worries about the treatment of Americans abroad, safety and security, fears of cost increases due to tariffs, immigration and border policies, and travel restrictions.
gYou canft just take one angle and say, eOh, the economy is having an issue. So letfs find something less expensive,fh said Beci Mahnken, CEO of MEI-Travel. Other clients say, geI donft want to travel to the United States,f or eI donft want to travel outside the United States.f c Itfs like a rock tunnel, going and going.h
One shaft of light at the end of that tunnel could be savings on last-minute summer trips as travelers increasingly take a wait-and-see stance with their plans.
Hitting a ebrick wallf
Mahnken first saw signs of trouble in early April, when US stocks plunged over fears of a chaotic trade war.
Mahnken and her travel agency staff started getting phone calls from clients, calling to cancel vacations they had booked or seeking refundable trips. She said they were fearful because their 401(k)s and other investments had taken a dive. That uncertainty, she says, made them pause on discretionary spending like a summer trip.
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Until that moment, Mahnken said, the frenzy of heightened grevenge travelh activity that started after pandemic restrictions lifted had not slowed over the course of four years.
gWe were still on this incredible high,h Mahnken said. gAnd then c it almost hit a brick wall.h
Flight analytics firm Cirium pulled flight booking data from online travel agencies from the end of January through early May, when people typically book summer trips. That data, which Cirium shared with CNN, indicates that bookings for travel in June, July and August are down nearly 10% when looking at flights from major US airports to favorite European destinations, compared to the same period last year.
Flights booked in the opposite direction from Europe to the US are down 12% in the same period. That substantial drop is unusual, according to Jeremy Bowen, CEO of Cirium.
gWe donft often see it as wholesale as this and over such a short period of time. Really, that Q1 booking is really quite substantially lower since the beginning of the year,h said Bowen.
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