According to the numbers in the latest monthly report from the UK’s Office for National Statistics (ONS) on preliminary figures for overseas travel by UK residents, it seems as if the combination of Brexit anxiety, an anemic performance by the British pound on international currency markets and a distaste for U.S. President Donald Trump seems to be guaranteeing that 2017 is going to be a lost year for growth for the USA’s largest overseas source market, the UK.
Released before the Thanksgiving Holiday in the U.S., the ONS report, which covers international travel departures for the peak travel month of August, shows that:
- In August 2017, UK departures to North America—usually, about 90 percent of North American traffic visits the U.S.—were 520,000 (vs. 543,000 in April 2016), which is down 3 percent from a year ago.
- For the latest three months, total traffic to North America was 1,210,000 (vs. 1,231,000 in 2016), a decline of 2 percent from last year.
- Year to date for 2017, North American arrivals reached 2,580,000 (vs. 2,679,000 YTD in 2016), a number that is off 4 percent year-on-year vs. 2016.
Below is a table we’ve prepared which tracks monthly UK arrivals in North America over a five-year window.
These Numbers are no Surprise: Such a disheartening accounting is hardly a huge surprise, with the August figures coming—as they did—following the recent World Travel Market during which a number of reports revealed that more British travelers than usual were forgoing long-haul travel in favor of close-in holidays of shorter duration because of a UK pound that seems to be the victim of fatigue as the country’s citizens await closure of discussions surrounding the withdrawal of the UK from the European Union—a process that is schedule to be completed in early 2019. In the meantime, the British pound has yet to recover fully from the hit it took in the immediate wake of the June 23, 2016 vote in which UK voters approved a referendum to exit the EU. The graph below shows why the USA has been a costly expenditure for UK holiday makers.
Source: Xe.com
And Trump Doesn’t Help the Outlook: The British travel trade journal, TTG reported last week that the average room rate at President Donald Trump’s 13 Trump-branded hotels in the U.S. had fallen, year-over-year, at all but one of the properties, by up to 63 percent. Analysis by FairFX , a London-based firm that specializes in currency cards and international transfers, showed that a standard double room at Trump Las Vegas in January 2017 prior to Trump’s inauguration was priced at £637 ($850) but one year later, a two-night break in January is being offered for on offer for £237 ($316).
TTG subsequently asked its readership—comprised mostly of travel agents and other travel trade professionals—whether they would stay in a Trump hotel. Eighty-seven percent replied “no,” stating that they did not want to support Donald Trump or any of his businesses. Only Just 12 percent said yes, indicating that “it was just a hotel and politics has nothing to do with it.”
FairFX cautioned that other factors may be involved, such as currency exchange rates (i.e., a strong U.S. dollar), pointing out that the falling prices were suggestive of a widespread fall in demand.
