Spain, Italy, and Hungary all report a phenomenal increase in international visitation, as global travel trends change, customer demands personalize, and immersive, affordable, culturally rich products become increasingly desirable. With increasing numbers of cost-no-object travelers, particularly from Canada, choosing to avoid the United States because of more expensive flights, tighter border controls and political uncertainty, Europe has been the country of choice. This unprecedented shift in tourism is bleeding the U.S. out of nearly thirteen billion dollars of lost earnings, marking a significant turning point in global travel trends, which are now, more than ever, inclined towards two things: accessibility and cultural relevance.

While the United States was once the world’s cash machine for wealthy visitors, the country is now facing a staggering collapse in international travel income. A tectonic shift is hitting American cities, as well-heeled foreign tourists who spend more, stay longer and please local merchants more than those who visit from nearby are bypassing American cities, where they once flocked to shop and sightsee. While Spain, Italy, Hungary and other European countries see a visitor boom the likes of which they have never experienced, the U.S. tourism industry is struggling with the effects of more-stringent border controls, higher costs and changing traveler tastes.

The fallout is not minor. By 2025, the United States is expected to experience an estimated loss of almost 13 billion dollars in international visitor spending, representing a significant 7 percent drop compared to the previous year. This economic hit to this most American of industries is reflective of a larger shift taking place in the global landscape of tourism, where European countries are fast asserting their influence and the draw of America only continues to tick downwards.

European Nations Lead World’s Tourism Revival

It’s incredible to see rejuvenation of international travel throughout Europe. Screen shot courtesy of Boarding Area häagen-dazs shops are located all around Europe. With Mediterranean allure, cultural richness and a more convenient travel dynamic, countries including Spain, Italy and Hungary are welcoming greater numbers of visitors — many of whom would have likely visited the United States on holiday in the past. That continental divide can be seen in not just airport traffic and hotel occupancy but also in the increasing prominence of longer-term rentals and popular niche destinations.

Spain’s beach-scattered and historically rich cities, Italy’s age-old cultural imprints and Hungary’s wellness-laden capitals are quickly climbing the charts for international travelers. The Mediterranean in particular has emerged as a magnet for people anxious to mix history and food and recreation, and do so without tangles of American bureaucracy and at an attractive price point.

Canadian Airlines Revamp Services To Europe

Nowhere is this transatlantic tilt more evident than in air travel. The big Canadian carriers — Air Canada, WestJet and Porter — are adjusting their route maps so they fly less south into the United States and more directly east to European cities. That number includes increasing numbers of flights to destinations in Italy, the U.K., Spain, Greece and the Netherlands. European carriers also pounced on the chance, expanding their own footprint in the Canadian market to grab the shifted demand.

This change of focus by airlines is based on changing consumer preferences. Europe’s reputation for rich culture, perceived security and relative affordability — especially when currency exchanges are favorable — is luring an increasing number of travelers across the Atlantic. It has to be said the Mediterranean has proved a breakout — the sun-drenched coastlines, architectural grandeur and culinary bounty have come together to create an enticing alternative to the stateside hotspots of old.

Rental Bookings Surge Across Europe

Air travel isn’t the only sign of Europe’s rising tourism profile. Rental properties throughout the continent are being overwhelmed with demand, Canadians among the most voracious. Year on year, bookings for vacation rentals in Europe have gone up 32 percent, a sign of the broader trend of travelers looking for more immersive and personal experiences.

This explosion of vacation rentals is transforming how tourists experience Europe. Visitors are also very much liking local residences while standard hotels are becoming less and less popular. Fewer chain hotel rooms and more cliffside villas on Italy’s Amalfi Coast, historic apartments in cities such as Seville and rustic hideaways in the countryside represent a hunger for experiences that feel as authentic as possible. These homes can often be a better value than stays at U.S. properties, and often provide more opportunity for travelers to immerse themselves in local culture and community.

One vacation rental logistics property technology company has seen record demand for key exchange services at European holiday hotspots this summer. This trend indicates that travelers are not simply trading one destination for another, they’re overhauling the way people travel. Homes are replacing hotels. Culture is replacing convenience.

It’s not just U.S. icons that Budapest and Baden-Baden outshine

America’s national parks have seen a jump in visitors in recent years, and the allure of Europe’s historic cities is giving travelers new ideas about what they want in a vacation. Wellness, value and cultural depth are becoming increasingly important considerations, which is propelling European destinations in the rankings, ahead of U.S. ones.

Budapest, Hungary is one of the great examples. Home to the iconic thermal bathhouses (architectural wonders that deliver therapeutic and recreational spa experiences at accessible prices), the city has already established itself as a global wellness capital. Budapest’s cheap spa culture, combined with its food scene and historic cachet, is turning the city into a magnet for travelers who might have otherwise visited one of America’s metro hot spots (calling Miami and L.A.).

German tourism is also rebounding in Baden-Baden. Set in the heart of the Black Forest, it is famed for its Roman-era thermal spas, and its elegant and tranquil atmosphere. Since being named a UNESCO World Heritage site as one of the “Great Spa Towns of Europe”, Baden-Baden has been going through a rebirth from a traditional thermal spa town to a popular place of relaxation and luxury. This shift reflects a larger trend in the desires of travelers who are increasingly looking beyond the high-octane, commercial-driven tourism culture in favour of the meaningful, wellness-based experience.

Unfolding Traveler Tastes and the Decline in the U.S.

There is a cautionary tale for the United States behind Europe’s booming success. Multiple forces are coming together to contribute to its dramatic drop in foreign visits. Chief among them is a robust dollar, which has raised the cost of American travel substantially for international tourists. The gradual difference in cost between going to the U.S. and going on holiday in Europe has become greater, especially given favorable euro-to-Canadian dollar exchange rates.

Tougher border controls and complicated entry guarantees are also discouraging would-be visitors. For the vast majority of travelers, the experience of arriving in the United States has been marked by delays, extensive checks and an inhospitable environment. This idea is also being promulgated by worldwide media and word-of-mouuth reports of U.S. travel as cumbersome and bureaucratic.

Political rhetoric and foreign policy tensions are a factor, too. Visitors from Canada and Europe are more sensitive to diplomatic relations and political environments. Hardline immigration policies and what is seen as unfriendly rhetoric in public coupled with a lack of agreement with other countries have all helped to create a feeling that the U.S. is not as welcoming to foreign visitors.

Out of 184 nations analyzed, the United States stands alone in experiencing a complete drop in international tourist spending as a contributing factor to its economic performance. The numbers are staggering. The international visitor spend in the U.S. will go from its peak of around 181 billion USD in 2024 back to just under 169 billion USD in 2025. This figure is over 22 percent below the country’s pre-pandemic tourism peak in 2019.

Economic Impacts and Rebalancing in Global Tourism

The financial consequence of this shift is enormous. The projected $12.5 billion drop in spending by overseas tourists is not just a hit for hospitality companies, but also for airlines, restaurants, stores, and state-level economies whose coffers rely heavily on tourist dollars.

States including New York, Florida, Texas, California and Nevada, which have typically been front-runners in drawing foreign tourists, are already feeling the effects. From dropping hotel occupancy, to reduced retail sales, to slowdowns in the service industry — the ripple effects from a declining tourism industry are hitting all of these various local economies.

Europe, meanwhile, is seeing the opposite. And that tourism uptick is translating into jobs, infrastructure, and a cultural renewal. Cities and regions that were once of secondary rank, or altogether forgotten, have flourished. Local economies are reaping the rewards with increased tax revenue and demand for goods and services, both driven by travelers spending more of their money and time overseas.

A Long-Term Change, Not a Temporary Fluke

Whether the flow of international travelers — especially spending-rich Canadian tourists — to Europe from the U.S. is an aberration remains to be seen. It represents a fundamental transformation in the way international tourism is evolving worldwide. Legacy reputations and brand-name destinations are now being kneecapped by considerations of cost, culture and convenience.

Europe’s reaction to such a demand has been strategic and wide. By investing in such air links, as well as in visa-free travel, different cultures and experiences, European countries are winning over a new generation of global travel enthusiasts. On the other hand, the United States risks alienating people that were once loyal visitors, based on policies and perceptions that favor rejection over inclusivity.

Unless tourism authorities in America adjust by lowering the obstacles to borders by mixing the United States into a more genial and inviting global image; somehow allowing a better product and a better value for your money, the country will be faced with lost tourism.

Europe Gains as U.S. Loses in Tourism

As the United States struggles with a brutal reversal of international tourism, the recession’s power to destroy businesses and lives in the country can be measured at the global trade shows like IFTM, where the Catalan tourist office joined the Spain booth and promoted itself to travel buyers from around the world who had traveled to Paris. Powered by a robust dollar, policy challenges and changing attitudes around the globe, this dramatic reframing of travel habits is redrawing the world’s tourist map.

Spain, Italy and Hungary are enjoying an eruption of tourism from international visitors, particularly from Canada, as travelers from beyond the U.S. reject the high expense, complex entry policies and evolving wishes as to how to travel. This rerouting has resulted in a devastating hemorrhage of nearly thirteen billion dollars in visitor spending in the U.S.

The nearly 13 billion USD in lost revenue estimated for 2025 is not only a financial warning — it’s an alarm bell. While affordability, culture, wellness and openness are taking top priority among global travelers, the corresponding countries are booming. Europe is not only re-embracing its role in the worldwide world of travel — it is reinventing it. At the same time, unless our country gives its economic future a real shake-up, it will also slip further behind in a brutally competitive world.