Three Worrying Signs for Summer Travel in the U.S.
Key Takeaways
- Trust in air travel is declining in the wake of high-profile incidents — the share of travelers who say they trust airports “a lot” is down 7 points since February.
- 31% of U.S. adults say financial factors — their own financial situation and the economy as a whole — have a negative impact on their leisure travel plans.
- The share of millennials who plan on taking a domestic trip is down 8 points since December, with the generation increasingly considering international destinations.
It’s a tough time to be in the travel industry. After a long recovery from the depths of the COVID pandemic, things were finally feeling a bit more normal and predictable. Then 2025 hit.
There has been no shortage of travel coverage related to a potential downturn in the coming year, but most of it (ours included) has been centered around international arrivals. While a decline in tourists from abroad will have a significant impact on the U.S. travel industry, many in the sector have had some hope that domestic tourism could fill some of the gaps. Recent data, however, suggests the outlook may be bleaker than expected.
Trust in air travel is faltering after high-profile safety incidents
The first challenge facing the industry is wavering trust amongst U.S. travelers. Trust is often fairly consistent, and rooted in brands providing the basics — delivering on services paid for and protecting travelers’ safety. The problem is that, for various reasons, many travel brands haven’t been perceived as doing that in the past few months. So after slowly climbing upward throughout 2024, trust in air travel and accommodation companies is falling. Among U.S. adults with a domestic leisure trip planned in the next three months, the share who say they trust sectors of the travel industry “a lot” has dropped an average of 4 points in the last month alone.
After cresting earlier in the year, trust in major travel subsectors is declining
The most high profile industry issues have certainly been related to air travel this year. Most recently, alarm bells were raised about communication blackouts at Newark Liberty International Airport, spurring coverage in just about every major news outlet and even a spoof on Saturday Night Live. The issues resulted in major delays and cancellations, and even concern among travelers that it may be unsafe to transit through the airport. Newark hasn’t been the only airport that has experienced disruptions, but it certainly has raised awareness of issues related to the FAA and overall air travel. At the same time, trust in airlines is also faltering potentially due to a ripple effect from airport news, particularly close calls on the runway and other safety-related concerns.
On the accommodations side, the picture isn’t quite as bleak. But there was still downward movement for all accommodation types in recent months. Consumers have a greater variety of choice than ever before when it comes to accommodations, so a trust decline may have more of an impact in the way of shaking up the consideration set than it does on air travel.
The worst case scenario for the industry as a whole is that untrusting consumers decide to stay home altogether. Given other factors at play, this may not be an unrealistic assumption.
Financial circumstances have a negative impact on leisure travel plans
It’s not just shaken faith in the industry that may be inhibiting travelers’ plans. An uncertain economic situation is also at play. No matter consumers’ current financial circumstances, it’s difficult to ignore the news of an uncertain economy. And with travel being an expensive, discretionary category, it’s a logical place for cash-strapped consumers to cut back.
Economic factors are more likely than any other consideration to have a negative impact on U.S. adults’ leisure travel plans. Roughly 3 in 10 consumers (31%) say their personal financial situation and the U.S. economy as a whole are negatively influencing their desire to take a leisure trip in the next three months, 10 points more than the next most influential factor (concerns about other travelers’ behavior).
Personal finances and the economy are the most likely factors to have a negative impact on travel plans
Sentiment varies across different consumer groups. One demographic split worth noting is that millennials are the least likely generation to say that both economic factors weigh negatively on their willingness to travel for leisure. This could be reflective of their wholehearted commitment to travel (and willingness to spend even if their finances aren’t in the best shape) or, alternatively, it could be related to their growing financial security.
Either way, this might suggest good news for the industry. However, this same group is also increasingly likely to eye destinations outside of the U.S. rather than traveling domestically.
Millennials are taking their money outside the U.S.
While U.S. travel brands may be hoping for millennials to carry the travel banner this summer, in reality their interest in domestic travel is trending down. In December 2024, looking to the year ahead, 91% of millennials with leisure travel plans said they’d take a trip within the U.S. That number now sits at 83%, up slightly from a low of 79% in March, but hovering around the same measure since January. At the same time, the shares who said they’d go to international destinations have ticked up, primarily in the Americas and Europe.
Interest in South America has grown the most, up 8 points since December, with Central America, the Caribbean and Northern Europe up 7 points each, and other destinations following close behind.
Millennials are increasingly considering international destinations
Again, reasons for this shift may vary. Financial confidence could be playing a part, as international travel is often more expensive (in some areas) than a domestic trip. But it may also be reflective of the larger political landscape that is also impacting inbound international travel, or perhaps just a desire to get away from the chaos for some time. No matter the cause, travel brands must do what they can to court millennial travelers with international aspirations, especially given hesitancy from other generations of travelers.
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Lindsey Roeschke is an analyst whose work focuses on behavior and expectations of consumers in the travel & hospitality and food & beverage categories, particularly through a generational and cultural lens. Prior to joining Morning Consult, she served as a director of consumer and culture analysis at Gartner. In addition to her research and advisory background, Lindsey has more than a decade of experience in the advertising world. She has lived and worked in seven cities across four continents.
