President Donald Trump’s tariffs on imports from Canada and Mexico took effect Tuesday, igniting a trade war. He also doubled a tariff previously placed on some Chinese goods.
The actions have prompted retaliation from the countries – America’s biggest trading partners – and U.S. consumers could see higher prices on a wide range of products, from fertilizers to printed books and sugar.
Those planning vacations could feel the effects, too. Trump’s latest tariffs are likely to have some impact on travelers, though it won’t be as immediate or noticeable as the rise in prices in other areas.
Here’s what travelers should know.
How will the tariffs affect travelers?
According to Steven A. Carvell, a professor of finance at the S.C. Johnson College of Business at Cornell University, business travel will likely take the biggest hit first.Need a break? Play the USA TODAY Daily Crossword Puzzle.
“This is going to have multiple rounds of impacts, and we are going to see business travel, group travel, corporate travel, decline as a result of it,” Carvell told USA TODAY. “There will be less cross-border travel and less demand for hotel room nights because of that. Group travel will be down because of that, meetings maybe.”
He added that large trade shows like the annual Consumer Electronics Show (CES) in Las Vegas could be affected if businesses decide to prioritize exhibiting in other countries.
Will tariffs make travel more expensive?
While Carvell said it’s unlikely that tariffs will have a noticeable, immediate impact on hotel room prices or airfares, a trade war could affect the supply chain and cause longer-term impacts on the travel industry.
The tariffs could have “major” implications for aircraft manufacturers, added Scott Keyes, founder of Going.
“Planes have thousands of components, many of which are manufactured outside the U.S., and all of which need to be regularly serviced or replaced,” he said in an email. “The longer tariffs last, the more likely we’ll see air travel impacted in the form of higher costs for Boeing and airlines, fewer overall flights, and higher fares.”
In addition to the potential decrease in business travel – leading to fewer flights and higher fares to Canada and Mexico – he said fares could rise because of lost revenue airlines earn from selling empty cargo space to goods shippers. Carriers may attempt to offset that by raising ticket prices.
If the tariffs lead to a recession, however, those costs would likely decrease. “That’s because demand for travel typically falls during economic hard times, and with less demand, airlines would be forced to drop prices in order to fill planes,” Keyes said.
Tariffs can also strengthen the U.S. dollar, benefitting American travelers, he added – though the dollar fell to a three-month low on Tuesday.
