Australians shun US travel as Trump sparks confusion, then backlash

American political chaos spurred by President Donald Trump has dampened demand for US holidays, figures show, as anger and uncertainty around his actions hit Australian travel.

Leisure travel bookings to the United States have dipped as much as 10 per cent in the first quarter, compared with the same period last year, data from Flight Centre shows, as consumers chose Asia and Europe as a destination.

US President Donald Trump has infuriated allies, and made Australians feel unsure of their welcome to the US.Credit: AP

Flight Centre Travel Group chief executive leisure James Kavanagh said the US had long been a favourite for Australians, but “we must acknowledge the political environment in the US and the fact that it may influence Australians’ decisions on where they choose to travel”.

Trump has imposed a range of trade tariffs on partners and a crackdown on immigration that has not only fallen foul of US courts, but created fear and confusion for US-bound visitors. The stories of Australians blocked from entering the US, or being searched and detained, have soured appetite for the US as a destination.

Travel industry leaders said Australians were expected to continue travelling internationally, but increasingly, to Asia and Europe.

Flight Centre Corporate chief operating officer Melissa Elf said: “A reprioritisation could see an impact on travel volumes into the US as we get further into the year, but anticipate this would be replaced with travellers focused on other regions that offer greater opportunity to Australian businesses, such as Asia and the Middle East for example.”

Despite the drop in leisure bookings, Flight Centre said corporate travel to the US actually edged up 2 per cent in the same period.

Equities analysts also saw fallout from the turn against travel to the US.

“US domestic travel demand is weakening, while inbound travel to the US is declining sharply – particularly from Europe – amid political tensions,” Shaw and Partners equities analysts noted.

WEB Travel Group derived an estimated 25 per cent of its total transaction value from the US, Shaw said.

This reliance by the corporate travel wholesale firm (which demerged from Webjet Group in September) would have “some impact” on the company’s total transaction value in fiscal years 2026 and 2027, according to Shaw, though it would be “mitigated by substitution to alternative destinations”.

Shaw lowered its price target on WEB Travel Group’s stock, while maintaining a “buy” rating.

“During a wave of uncertainty, one thing is evident – Trump’s policies and pronouncements have produced a negative sentiment shift toward the US among international travellers,” consultancy Tourism Economics said in early April.

“The correlating decline in international travel to the US is expected to be strongest in 2025, with persisting degrees of impact throughout the remainder of Trump’s second term.”

The Anglo-American consultancy expects a 9.4 per cent decline in international visitor arrivals to the US for 2025, led by a 20.2 per cent drop in Canadian visitors. Trump has pursued a confrontational policy with Canada, deriding it as a 51st state of the US.

The US economy is set to lose billions of dollars in revenue in 2025 from a pullback in foreign tourism and boycotts of American products, adding to a growing list of headwinds keeping the recession risk elevated.

Goldman Sachs Group estimates in a worst-case scenario, the hit this year from reduced travel and boycotts could total 0.3 per cent of gross domestic product, which would amount to almost $US90 billion ($142 billion).

Foreign tourism has been a tailwind for the US in recent years as the cessation of COVID-19 pandemic-era restrictions sparked a resurgence of international travel. But many potential visitors are now rethinking their holiday plans amid increased hostility at the border, rising geopolitical frictions and global economic uncertainty.

Credit: Matt Golding

One of them is Curtis Allen, a Canadian videographer who cancelled a coming US vacation after Trump imposed punitive tariffs on his home country and suggested it should become the 51st US state. Allen and his partner have been on multiple camping trips to Oregon over the years, but this year they will be travelling around British Columbia instead.

“We’re not just staying home,” said Allen, 34. “We’re going to go spend the same money somewhere else.”

International travellers spent a record $US254 billion in the US last year, according to ITA figures. Coming into 2025, the outlook was positive. The ITA projected in early March that the US would welcome 77 million visitors this year, just shy of the 2019 record, before pushing to a new high in 2026.

But those estimates came out just before stories of harsh detentions at US airports, ensnaring travellers from countries such as France and Germany, started making headlines.

“US tariff announcements and a more aggressive stance toward historical allies have hurt global opinions about the US,” Goldman Sachs economists Joseph Briggs and Megan Peters said in a March 31 report.

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