The UK’s Office for National Statistics (ONS) last week released its preliminary statistics on overseas travel and the data confirmed what many in the U.S. tour and travel industry had suspected through much of 2017: Last year was an underperformer.
For 2017, total departures for North America (the USA usually accounts for about 90 percent of the total market) were down 5 percent vs. 2016. This contrasts with a 2 percent increase in the overall number of international travelers from the UK, and a 3 percent increase for UK travel to Europe.
If there is any single culprit that, more than any other factor, contributed to the decline in the market, it was probably the performance of the British pound sterling vs. the U.S. dollar. The pound fell 17 percent against the dollar in 2016, much of the decline following the June 23rd “Brexit” referendum, in which Britons voted to withdraw from the European Union. The weak pound during the latter part of the year influenced the purchasing decisions of British travelers for 2017.
For 2017, the pound rebounded—it closed 2017 at $1.35 vs. the dollar, up 10 percent from $1.23 at the end of 2016, but still down 9 percent from the $1.48 exchange rate that closed out 2015. The ONS data on UK overseas travel are significant in that they are the first numbers for 2017 from a major U.S. overseas source market. It will likely be another couple of months before the U.S. Department of Commerce’s National Travel and Tourism Office (NTTO) releases full-year figures on arrivals to the U.S. from the major source markets for international travelers. The table below (remember, the latest data are preliminary) puts the performance of the UK market for travel to North America into a five-year perspective.
Notes on the latest ONS data release:
- December 2017: UK departures to N. America were 200,000 (vs. 247,000 in December 2016) = Down 14 percent
- Last quarter of 2017, UK departures to North America totaled 920,000 (vs. 1,021,000 in Q4 2016) = Down 10 percent
- For the full 12 months of 2017, UK departures to North America totaled 3,940,000 (vs. 4,133,000 for = Down 5 percent