Las Vegas Records a Dip in Air Travel amid US-Canada Trade War

Tariffs announced by the United States for Canada and Mexico raised a range of concerns across different industries. Not unexpectedly, tourism, gaming and hospitality sectors were among the ones that were significantly concerned about the impact of the tariffs.

Air Travel Decreases in February

Further exacerbating the already intense situation was President Donald Trump’s suggestion to make Canada the 51st US state. But has the subsequent boycott on US goods and traveling by Canada had any material impact on the former country and the casino and hospitality industry in particular?

So far, it is too soon to say what the impact of the tariffs would be as it has only been a month, and the situation seems to be still in development. However, data from Harry Reid International Airport, based in Las Vegas, Nevada, showed a notable decrease in domestic and a slight dip in international travel.

Per this data, visitors to the gambling capital of the world were just above 4 million in February this year. In contrast, arriving and departing passengers monthly total in February 2024 were 4,336,169. This means that last month, a year-over-year decrease of 7.5% was recorded.

Further breakdown shows that domestic travel decreased notably by 7.7% from nearly 4 million passengers in February 2024 to 3,679,787 last month. When it comes to international carriers, Harry Reid International Airport recorded a 2.6% decrease in the number of passengers to 270,651.

Details released by Canadian airlines pointed to notable year-over-year decreases, with Flair reporting a drop of 55.2% year-over-year in February. Similarly, Westjet recorded a significant 17.3% year-over-year decrease in the number of passengers this February.

Canada Responds to the Tariff

While the political and economic changes might be bad for business, that’s certainly not the case for Canada’s Prime Minister and Liberal Party leader, Mark Carney, who has better odds of winning the next election. Betting markets data from Polymarket highlights this chance, showing the PM’s odds improving from 32% to 41% in a matter of several weeks.

Amid the talks about tariffs on Canada, Alberta announced the ban on US slot and video lottery terminal purchases earlier this month. The action reaffirmed the growing trading tension between the two North American countries.

Previously, the US Travel Association has estimated that a potential decrease in travel spending by Canada tourists may result in significant losses. An approximate 10% drop in the travel spending in the US may jeopardize some 14,000 jobs and result in $2 billion harm to America’s economy, the Association warned.