The U.S. Tour Operators Association advised members of the possible impact of President Donald Trump’s sweeping tariffs announced Thursday.
USTOA president and CEO Terry Dale said in an email to members that he asked the association’s government affairs firm, Elevate, for its take.
Near-term, Elevate said the tariffs could influence foreigners’ views of traveling to the U.S. and affect the reputation of American travelers abroad.
Longer-term, Elevate said higher product prices caused by tariffs have the potential to decrease consumers’ purchasing power, making discretionary purchases like travel less affordable. Tariffs also could increase costs for hotels, airlines and cruise ships.
There also is the potential for increased prices of imported beverages and other goods associated with leisure, said Elevate, affecting the bottom line of event venues, nightlife and restaurants.
Elevate added words of caution about its forecast of possible effects: the U.S. is in relatively uncharted territory.
“As the new tariffs have raised import taxation levels to historic rates, there is still not a consensus among experts on the effects on global markets, trade, and ultimately, travel and tourism,” Elevate said. “Similar tariff rates have not been implemented for nearly a century, with global trade and commerce having dramatically changed since then. We cannot be certain about impacts at this time.”
A U.S. trade war with Canada that began in February has already affected travel. In late March, aviation data company OAG reported a decline of more than 70% in advanced flight bookings for the summer between Canada and the U.S. For each month from May through September, advanced bookings are down between 71.4% and 72.2%.
A Travel Weekly survey found that 52% of travel advisors are very concerned about the long-term impact of federal government changes on their travel businesses. Fifty-nine percent reported that their clients are concerned about anti-American sentiment while traveling.
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