Flight Centre has warned it could lose more than CAD $88 million in earnings this year as demand for travel to the US drops quickly.
In a statement to the Australian Securities Exchange (ASX) this week, the Brisbane, Australia-based company pointed to “volatile trading conditions” linked to changes in US entry policies.
The Australian Financial Review said the earnings warning "follows growing consumer fears linked to US immigration checks, reports of tourists being detained, and rising costs.”
Asked for comment on Flight Centre’s operations in Canada, a spokesperson told Open Jaw it has no immediate comment.
The Financial Review said Australian visitor numbers to the US fell by 7% in March compared with the same time last year. That compares to a 17% drop in Canadian visits to the US for March, as well as a 28% fall in visits from Germany, 25% drop in visits from Spain, and an 18% reduction in UK visitors.
“People from Europe, the United Kingdom and Australia really don’t want to go to the States, given what’s happening there. We’re hearing more and more people don’t want to go through passport control,” said Flight Centre CEO Graham Turner, although he added that most travellers with Australian passports were not experiencing significant problems.
Quoting stats from the Airlines Reporting Corporation, the New York Times this week said sales of tickets for summer travel to the States from all countries outside of Canada are down only 2% versus the same period last year. But it said summer sales from Canada were down 21% compared with last year.
“The decline in Canadian travellers, who make up roughly a quarter of all foreign visitors, is enough by itself to threaten tourism-oriented businesses in Florida, New York, Maine and other popular destinations,” The Times said.
As reported this week by Open Jaw, three major North American airlines recently opted to cut back on proposed route expansion between Canada and the US. WestJet has decided not to go ahead with a new YVR-AUS route, while Air Canada has backed away from plans to add more capacity between YUL and SFO. JetBlue says it has cancelled proposed BOS-YHZ service.
Statistics Canada says Canadian resident return driving trips from the US fell by 31.9% in March of this year compared to March, 2023.
