Economic Slump Derails America’s Tourism Boom

IPK International is forecasting that US outbound travel will be hit harder in 2009 than inbound travel. IPK will release extensive details on America’s inbound and outbound travel performance during the ITB Future Day, March 11, at ITB Berlin.

According to the upcoming ITB World Travel Trends Report 2009 tourist arrivals growth into the USA was running at 8% until August 2008. September was flat. While final figures are still being collated, the report says declining arrivals in Q4 will drag America’s overall performance for 2008 down from 8% to 6%.

“A figure of 6% is well above the world average,” said Dr. Martin Buck, Director of the Competence Center Travel & Logistics at Messe Berlin, which commissions the ITB World Travel Trends Report. “However, the abrupt change is worrying as it tells the US travel industry what to expect in early 2009. Weak demand from foreign markets seems likely to continue, especially if the dollar stays strong.”

According to official US data, before the abrupt Q4 2008 global economic downturn, European arrivals into America had been surging ahead at an average of 17%, led by Spain (+36%), Italy (+29%), France (+28%), the Netherlands (+26%) and Germany (+20%).

Travel from Asia to the USA, however, stagnated in 2008, attributable in large part to a 6% decline in travellers from Japan, the USA’s largest market in Asia.

The contraction in American outbound travel has been even more severe. Despite a strong start to 2008, growth in US outbound travel slowed fairly dramatically in March, and turned negative in June, the beginning of the outbound slump. By September, the monthly decline was over 7%.

As Americans reduce their travel, Europeans are being hit the hardest, according to Dr Buck.

“Europe and other destinations dependent on travelling Americans need to go on alert and adjust their strategies,” he said. “What we’re seeing in the ITB World Travel Trends Report is a continued decline in American consumer and business confidence combined with higher unemployment and lower disposable incomes – despite the otherwise positive Obama effect.”

Dr Buck added, “Americans seem likely to trade down in terms of destination choice and type of trip. Business travel, especially travel for meetings and conventions, is the new weakest link.”

He said that for leisure travel, the new preference among Americans is to take shorter trips closer to home. “The destination is almost irrelevant,” said Dr Buck. “It simply depends on the overall deal available.”

ITB Berlin 2009 will be taking place from Wednesday, 11 to Sunday, 15 March, and will be open to trade visitors from the Wednesday to the Friday. Parallel with the trade fair, the ITB Berlin Convention will be taking place from Wednesday, 11 to Saturday, 14 March 2009.

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