US President Donald Trump on Wednesday unveiled a sweeping set of tariffs that will affect products from a long list of countries.
Among the proposed tariffs: 25% on all imported cars and reciprocal charges in at least 50 countries that could reach almost 50%. The plans go further than many expected. Reciprocal tariffs are not based solely on other countries’ tariffs: “We will calculate the combined percentages of all their tariffs, non-monetary barriers and other forms of cheating,” Trump said at an event in the Rose Garden of the White House.
For the travel industry, the impact is indirect according to an analysis by Skift. Tariffs apply to imported goods, cars, washing machines and even champagne. They are not added to the prices of airline tickets, hotel rooms or tours. But the impact could be significant. Tariffs could lead to higher prices making America a more expensive destination for visitors.
The impact on hotels
Hoteliers face two potential areas of additional costs: the cost of new construction and the cost of furniture, fixtures and fittings. Tariffs on construction materials, such as steel, may eventually push prices up, as noted.
“If tariffs lead to higher costs, builders may again face economic hurdles that could slow down project timelines,” wrote Pranavi Agarwal, senior analyst at the survey. U.S. Hotel Supply Outlook: How Slowing Growth Is Shaping the 2025 Market.
Hoteliers may also face rising costs for furniture, fixtures and fittings. Among extended stay hotel operators, there is cautious optimism. The relocation of production to the US could benefit the due to increased demand for temporary worker housing near new projects.
The effect on airlines
Tariffs have begun to affect travel between the US and Canada. United Airlines CEO Scott Kirby told an investor conference in March that there is a negative impact on Canadian travel to the U.S. Boeing chief financial officer Brian West said the company does not expect a major impact “directly” from the tariffs. The U.S. aircraft maker has a huge backlog of orders, which West said would shield the company in the short term. However, he added that there is some concern that the tariffs could have an impact on parts availability.
Airbus could prioritise deliveries to customers outside the US as a result of the tariffs, the company’s chief executive said in February, according to Reuters. “We have a lot of demand from the rest of the world, so [if] we face very significant difficulties to deliver in the US, we can also adapt by accelerating deliveries to other customers who are very keen to acquire planes,” Airbus CEO Guillaume Faury said. Speaking to Skift last week, Ryanair chief executive Michael O’Leary highlighted the level of uncertainty: “There are a lot of unintended consequences built into what Trump is doing. We honestly don’t know whether it will be purely positive or purely negative – we’ll have to wait and see.”
