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The US tourism slump that never happened

  • Automatic
  • 22 August 2025
  • 1 minute read
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This article was written by Hospitality Today. Click here to read the original article

Fears of a summer crash proved overblown as domestic demand held firm — but warnings suggest the real test may lie ahead

Aug 22, 2025

US tourism businesses feared a sharp downturn this summer under Trump’s disruptive policies, but resilient domestic demand — especially from wealthy travelers and budget-conscious families — has steadied the sector. Luxury hotels and cruises are thriving, campsites and RV parks are filling up, while international arrivals and mid-market hotels face mounting pressure.

Key takeaways

  • Luxury resilience: Wealthier Americans, shielded from economic uncertainty, kept luxury hotels, cruises, and higher-end experiences profitable despite fewer overall travelers.
  • Budget strength: Campsites, RV parks, and ultra-budget options saw rising demand as cost-conscious travelers “traded down” instead of canceling vacations.
  • Mid-market struggles: Economy and midscale hotels reported falling revenue per available room, squeezed by inflation, high interest rates, and last-minute bookings.
  • International decline: Foreign arrivals to the US fell nearly 4% in the first seven months of 2025, driven by Canadian boycotts and higher visa costs.
  • Domestic offset: With nearly 90% of tourist spending coming from Americans, the strong domestic market has prevented a wider industry collapse.
  • Uncertain outlook: Analysts warn that tariffs, budget cuts, and reduced international demand could weigh on long-term growth, even as summer demand remained steady.

Get the full story at the Financial Times (subscription required)

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