The U.S. travel industry is facing significant challenges as international tourists rethink their plans. This shift is largely driven by President Donald Trump’s trade policies, diplomatic tensions, and controversial statements. According to a report from Tourism Economics, international travel to the U.S. is expected to drop by 5% in 2025, leading to a projected $64 billion loss in travel spending.
Preliminary data from the U.S. Department of Commerce’s National Travel and Tourism Office (NTTO) shows that inbound travel to the U.S. fell by 2% in February 2025 compared to the same time last year.
Economic factors, geopolitical concerns, and changes in public sentiment are all contributing to this decline, especially among travelers from Canada and Western Europe, two of the U.S.’s largest international travel markets.
Canadian Visitors Cancel Trips to the U.S.
Canada, which has long been the U.S.’s top source of international visitors, is seeing a notable decrease in cross-border travel.
Statistics Canada reveals that visits by car from Canada to the U.S. dropped by 23% in February, while U.S. car trips to Canada decreased by 7.9%.
This decline follows Trump’s repeated comments suggesting Canada should become the 51st U.S. state, a statement that has sparked anger among Canadians. In response, former Prime Minister Justin Trudeau urged Canadians to travel within their own country, promoting national parks, historic sites, and local tourism destinations.
Travel from Western Europe Declines Amid Trade Tensions
Western Europe, which made up 37% of all overseas visitors to the U.S. in 2024, is also seeing a drop in travel demand.
Travel from Western Europe fell by 1% in February, with Denmark seeing a 6% decrease compared to the previous year. Tensions between the U.S. and the European Union (EU) have worsened, especially after Trump threatened to impose a 200% tariff on alcoholic beverages imported from the EU, calling the EU “one of the most hostile and abusive taxing and tariffing authorities in the world.”
The U.S. Travel Association, which represents the U.S. tourism industry, has warned that Trump’s trade policies and diplomatic approach could continue to negatively impact visitor numbers. This, in turn, would affect various sectors, including hotels, airlines, restaurants, and national parks.
German Tourists Reroute Their Travel Plans
For some international travelers, the U.S. is becoming a less appealing destination. Jens Muellers, a German tourist who has visited the U.S. four times, decided to cancel his planned summer trip to Seattle, choosing instead to visit Canada.
The Future of U.S. Tourism
Tourism is a major contributor to the U.S. economy, generating over $1.9 trillion annually, according to the U.S. Bureau of Economic Analysis (BEA). However, if the current trend continues, the tourism sector may face severe revenue losses, which could have wide-reaching consequences for businesses that depend on international visitors.
With political instability, changing global alliances, and economic uncertainty, many travelers are now choosing destinations like Canada, Europe, and other politically stable regions over the U.S.
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