Travel outlook steadies as wealthy Americans keep spending

Luxury demand cushions industry while middle- and lower-income travelers scale back

The U.S. travel industry is stabilizing as higher-income consumers continue to drive demand for premium flights and luxury hotels, even as middle- and lower-income travelers cut back or book shorter, last-minute trips. Analysts see resilience at the top end but warn that inflation and tough year-over-year comparisons could weigh on growth.

Key takeaways

• Luxury resilience: Premium airline seats and luxury hotel segments are seeing strong demand, especially for international travel.
• Middle- and lower-income caution: Many travelers are shortening trips, staying closer to home, or skipping travel altogether.
• Investor optimism: Analysts see the outlook improving compared with earlier this year, though growth remains fragile.
• Inflation pressure: Rising prices may further strain discretionary spending, particularly among less affluent households.
• Booking behavior: Travelers at the lower end of the market are booking later, reflecting heightened uncertainty.
• Future boost: Next summer’s World Cup across North America is expected to lift domestic travel demand.

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