As President Donald Trump continues his second term, a major shift in North American travel trends is reshaping the tourism economy — and the financial impact is reaching into the billions.
New data shows that Canadian visitors are pulling back from U.S. vacations in significant numbers, redirecting their travel dollars elsewhere — particularly to Mexico.
The result? A measurable economic shift that is boosting Mexico’s tourism sector while pressuring parts of America’s travel industry.
Canadian Travel to the U.S. Plunges 24%
According to official figures from Statistics Canada, Canadian return trips to the United States dropped 24% year-over-year in January, totaling just 1.6 million visits.
Breaking that down:
- 🚗 Automobile travel declined 27%
- ✈️ Air travel fell 18%
This downturn coincides with ongoing trade tensions and political friction between the U.S. and Canada.
After President Trump implemented tariffs on certain Canadian exports and publicly floated the idea of Canada becoming the “51st state,” then–Prime Minister Justin Trudeau encouraged Canadians to “buy Canadian” and reconsider travel south of the border.
The ripple effects are now showing up in airline schedules, hotel occupancy rates, and tourism revenue projections.
Mexico Tourism Surges as Canadians Redirect Travel
While U.S. destinations see softer bookings, Mexico is experiencing a noticeable surge.
Data from Mexico’s civil aviation agency and Anáhuac University’s tourism research center reveals:
- Toronto–Cancún is now the busiest international route into Mexico.
- Travel from Toronto to Cancún jumped 26% year-over-year.
- Montreal–Cancún travel surged 24%.
- Six of the top ten U.S.-Mexico Caribbean routes saw passenger declines.
In short: Canadian tourism dollars are shifting south — but not to the United States.
Billions at Stake for the U.S. Economy
The financial consequences are substantial.
Forbes estimates the drop in Canadian visitors could cost the U.S. economy $4.5 billion in 2025 alone.
Meanwhile, the U.S. Travel Association projects that reduced international tourism spending contributed to a $5.7 billion hit last year.
For American businesses — especially:
- Border-state hotels
- Restaurants
- Retail centers
- Theme parks
- Snowbird vacation markets
— the slowdown represents real revenue pressure.
Why Are Canadians Staying Away?
A YouGov survey commissioned by Flight Centre Travel Group found:
- 62% of Canadians say they are less likely to visit the U.S.
- 57% cite the current political or cultural climate.
- 37% prefer domestic Canadian trips for 2026.
- Many are choosing Europe, Mexico, or Asia instead.
Airlines are adjusting accordingly.
Canadian carriers have reduced U.S.-bound seat capacity by nearly 10% in early 2026 — roughly 450,000 seats removed from the market.
At the same time, Air Canada is expanding Mexico service by 18%, adding routes to:
- Guadalajara
- Cancún
- Mexico City
- Monterrey
- Puerto Vallarta
The market is reacting to consumer demand — and demand is moving away from U.S. destinations.
Is This Temporary — Or a Long-Term Shift?
Industry analysts remain divided.
Some argue this is short-term turbulence tied to trade negotiations and political rhetoric.
Others warn it could permanently reshape Canadian travel spending patterns.
Either way, the numbers are clear: Mexico is currently benefiting from a redirection of North American tourism dollars.
The Bigger Picture for President Trump’s America
Supporters of President Trump argue that economic nationalism, tariff leverage, and trade realignment are designed to strengthen America’s long-term economic position — even if short-term sectors experience pressure.
Critics argue the tourism industry is an early casualty of trade disputes.
But in global markets, money flows where consumers feel most comfortable spending it.
Right now, billions in Canadian tourism dollars are flowing to Mexico.
FAQ: Canada Travel Decline and U.S. Tourism Impact
Why are Canadian visits to the U.S. down?
Travel data shows a 24% year-over-year drop, coinciding with trade tensions and political disagreements.
How much could this cost the U.S. economy?
Estimates suggest losses of $4.5 billion to $5.7 billion tied to reduced Canadian and international tourism spending.
Which country is benefiting most?
Mexico has seen double-digit increases in Canadian travel, particularly to Cancún and other resort destinations.
Are airlines reducing U.S. flights?
Yes. Canadian carriers have cut U.S.-bound seat capacity by nearly 10% while expanding routes to Mexico.
Final Takeaway
North American travel patterns are shifting — and the financial implications are real.
Whether this proves to be a temporary reaction or a longer-term restructuring of tourism flows remains to be seen.
But at this moment, Mexico is capturing travel dollars that once flowed heavily into the United States.
And in a competitive global economy, those billions matter.