Compared to pre-pandemic levels, airports in large American markets are still lacking international tourists. The shortfall is most noticeable in Honolulu, which is disproportionately impacted by changes in the Asian economy, especially in China.
Since China only recently allowed its citizens to travel freely again, it will take a while for the number of Chinese travelers to return to pre-pandemic levels. Hawaii and West Coast markets such as Los Angeles and San Francisco will need to rely more on domestic travelers and visitors from other international regions to make up the shortfall.
Downtown hotels in many West Coast markets have yet to recover to 2019 demand levels, and the lack of international travelers compounds the domestic demand shortfall.
The U.S. Commerce Department, through its International Trade Administration, publishes international inbound and outbound traveler counts. According to the Commerce Department, “the information collected provides non-stop point-to-point air traffic totals between the U.S. and all other countries and the U.S. and foreign airports.” The point-to-point air traffic totals, therefore, exclude travelers who landed in a different airport and switched to a connecting, domestic flight to terminate at their final airport. This notwithstanding, the magnitude of change compared to the first four months of 2019 is telling. Only Dallas recorded a very slight increase compared to three years earlier. Traffic to other major airports dropped approximately 20%.
A different picture emerges in the tally of American travelers going abroad at the beginning of 2023. Outside of some markets in China, the number of U.S. visitors to major foreign markets has either fully recovered or is on the cusp of doing so.
Rome and Paris stand out as European markets with strong appeal to leisure travelers. American passenger counts increased over 10% in both markets compared to 2019. Amsterdam and London passenger counts from the U.S. are on par with 2019 results. Dubai and Frankfurt have almost fully recovered. Outliers are two markets in Asia — Hong Kong and Tokyo. Even though China is fully open to travelers, visitation to the mainland and Hong Kong is still depressed. In Japan, which also opened to foreign travelers more recently, international inbound passenger counts soared.
The impact of positive international air traffic growth from U.S. leisure travelers was likely negative for the U.S. hotel industry. Hoteliers used to catering strictly to domestic demand over the past three years should therefore once again spend time and energy attracting international visitors.
Looking ahead, American traveler counts will possibly be impacted by a slowing in the U.S. economy. But any slowing in the global economy will likely also impact travel to the U.S. from abroad. According to the major domestic airlines’ earnings calls, demand in the summer months will likely be brisk from foreign and domestic customers. The outlook for fall and winter is more difficult to predict.