By Michael Baginski/ It’s certainly no secret that Canadian travel patterns have changed this year, as many travellers look beyond the U.S. for alternative destinations that are not imposing tariffs or teasing about statehood. Indeed, data from Statistics Canada bears out what we all know anecdotally, but it also provides interesting nuance and perspective on how Canadians really feel about travel to Trump’s America – and where else they’re going.
Speaking on a virtual panel for the Discover America Canada Committee late last week, Jennifer Hendry, senior research analyst at the Conference Board of Canada, laid out an important foundation: “Canadians are a very savvy travel market, and we still are exploring the world. The outbound travel market is actually doing pretty well.”
“However,” she acknowledged, “We all know that travel sentiment towards the U.S. shifted earlier this year.”
In the first nine months of the year, amid the implementation of tariffs and talk of 51st statehood by Trump, Hendry said 745,000 fewer Canadians travelled to the U.S. by land – a figure that was widespread across the country, and represented nine consecutive months of decline, amounting to about 32% overall.
“The last time (such a drop) happened was during COVID when the border was closed,” she observed.
As for air travel, 97% of which includes at least one overnight, Hendry said, “It’s not doing as poorly as auto, (though) it is still down 20% up until September.”
The good news, she said, is that at the same time – and not unrelated – travel by Canadians to overseas destinations jumped 9% year over year, now comprising 47% of all out-bound activity, year to date.
Replacement destinations
So where are they headed?
According to Hendry, “Normally everyone’s in a dreaming state at the beginning of the season and then as their plans firm up or economic realities hit home, the intent to travel drops. (But) we haven’t seen that since the pandemic ended. It actually has stayed quite stable, so the overall demand for travel is definitely there.
“What we’ve all noted though is that the regional distribution of those trips has definitely changed. Canada is still a very large market for the U.S., and it is still the largest outbound volume for Canada. But Canadians that are looking for escape, a lot of it is due to weather, so Mexico for sure – it had a huge increase this summer.
“And depending on the demographic of the traveller, Europe was quite popular, but interestingly a lot of South and Central American destinations that have new capacity are now bucket list options for many Canadians. So, I would say that Latin America and Mexico are the top replacement destinations for Canadian travellers right now.”
She concluded, “Overall, there obviously has been an abrupt and steep decline in transborder activity, but the overall outbound market is still travelling. There has obviously been a notable change in the travel pattern, but we’re not entirely sure yet if that is here to stay.”
Air Canada
Air Canada’s Viktor Spysak said the airline has seen increasing demand for the Caribbean, such as Bahamas, Jamaica, Belize, and “many other destinations in the region.” Additionally, new flights to South America, such as Rio de Janeiro, Lima, and Cartagena, are being launched to meet customer interest, he said, stating, “I think the demand is there; I think Canadian travellers are really looking for value, unique experiences, and a combination of culture and potentially sun…”
Birds-eye view
Noting that “we have a bird’s-eye view of what’s happening across the Canadian travel industry,” Raina Williams of the Expedia Group agreed that the company has seen a “softening” of demand for travel to the U.S., both in air and hotel searches, though observing that the decline in year-over-year hotel searches has been greater.
“When we look at Canadians as a whole, we did see domestic travel is showing sustained growth and actually in Q2 is where we saw it surpass US demand,” she stated, adding that Expedia has also seen a surge in interest in international travel, with Mexico, the Dominican Republic, and Italy, notable among the choices.
Coach touring
Meanwhile, Canada is now tops in motorcoach touring, said Michelle Tupman of Great Canadian Holidays, at least for a company whose “piece of the pie” consists mainly of senior travellers from southern Ontario.
Tupman said GCH previously sent nearly half of its clients to the U.S. on coach tours – a number that has dropped by 95% this year, thereby forcing it to pivot to other options, mainly domestic destinations.
Although eastern Canada has always been a favourite, Tupman said interest in Atlantic Canada and Quebec and the eastern townships has really heightened this year.
Additionally, day tour products in Ontario are proving “super strong” as well, for example going to see the Jays play at home in Toronto rather than following them on the road.
“And to this point (in the year),” she said, “it really hasn’t changed for us. We’re seeing maybe just the odd U.S. tour materialize with sort of break-even level numbers – it really isn’t shifting yet. We’re seeing people still wanting to do things. It’s just taking a little bit different slant right now.”
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