Trade tensions, a strong dollar and increased competition from other countries are contributing to a decline in international travel to the United States, according to the latest Travel Trends Index (TTI) from the U.S. Travel Association.
According to the latest TTI, travel to and within the U.S. grew 3.2 percent year-over-year in July—a slight rebound from June's nine-month low. International inbound travel contracted once again that month, falling by 1.2 percent. The decline follows the sector's six-month trend falling below zero for the first time since September 2015 in June. The Leading Travel Index (LTI), the predictive component of the TTI, projects international inbound travel growth will remain negative over the next six months (-0.4%).
The outlook for international inbound travel is consistent with U.S. Travel's forecast, the organization said, which projects America's share of the global long-haul travel market will fall from its current 11.7 percent to below 10.9 percent by 2022, despite a projected annual increase in volume of inbound visitors to the United States. Factors contributing to the market-share slide include the continued strength of the U.S. dollar, prolonged and rising trade tensions and stiff competition from rivals for tourism business, U.S. Travel said.
U.S. Travel said that policy changes such as the long-term reauthorization of the Brand USA destination marketing organization, expanding the Visa Waiver Program to include more qualified countries and improving customs wait times can help reverse the decline.
According to the TTI, however, domestic travel is continuing to expand by 3.8 percent, which kept travel's overall growth afloat. Domestic leisure travel surpassed its six-month average, increasing a robust 4.2 percent. Domestic business travel recovered from its -0.2 percent decline in June, rallying with 2.2 percent July growth.
The LTI projects domestic travel as a whole will expand 2.0 percent through January 2020.