A sharp one reject in Canadian travel to the United States will reshape the North American tourism landscape by the end of 2025. The downturn – one of the steepest in recent years – is mainly affecting US border states and tourism-dependent cities.
According to new data from the travel industry Canadian air traffic to the US fell 27.1% in September 2025 compared to the same month last year. The number of cross-border car journeys has fallen even further 35.8% annualized from July. These figures point to a broader decline in cross-border mobility between the two nations.
Why are fewer Canadians visiting the US?
Experts attribute the decline to a combination of economic pressures, currency fluctuations and evolving traveler behavior. A strong U.S. dollar and rising travel costs have made vacations south of the border less affordable for Canadian families. Meanwhile, inflation and higher fuel prices have discouraged leisure travel.
Policy-related hurdles – including longer border wait times and stricter visa and entry requirements – have also exacerbated the problem, creating additional friction for cross-border tourism.
Economic impact on US border regions
Local economies in tourism-dependent US states are starting to feel the pressure. In MontanaHotel occupancy rates have fallen by almost 40% since last summer, while the retail and hospitality sectors are reporting a significant drop in turnover.
Small businesses that once thrived on weekend traffic from Canadian visitors are now struggling to adapt to the reduced number of visitors. Industry leaders warn that without strategic marketing efforts, some border cities could face a long-term decline in their tourism revenues.
Canada’s domestic travel boom
Interestingly, while outbound traffic decreases, domestic tourism in Canada is reaching record heights. A report from the World Travel and Tourism Council (WTTC) projects CAD$104 billion in domestic expenditure for 2025 – the highest in the country’s history.
Canadian travelers are opting for homegrown experiences, exploring destinations like British Columbia, Quebec and Atlantic Canada, which are witnessing a surge in bookings and extended stays.
What is the future for cross-border tourism?
Tourism agencies in both countries are working on this reviving travel between Canada and the US through targeted campaigns and special offers. Experts predict that once currency values stabilize and inflation cools, travel volumes could begin to recover in 2026.
However, changing traveler priorities – such as sustainability, local culture and purposeful travel – suggest this The era of frequent short cross-border trips may make way for fewer, longer and more meaningful trips.
