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While California is still the top destination in the U.S., global tensions are rising.
California tourism leaders have cut billions from this year’s travel spending forecast due to global trade tensions.
Caroline Beteta, CEO of Visit California, said spending was originally expected to reach $166 billion in 2025, nearly 6% more than last year. But the state’s tourism agency recently lowered its estimate by $6 billion. The change reflects strained relationships with key international markets, including Canada and the United Kingdom.
Beteta shared the update with more than 200 business professionals and local leaders at a Wednesday meeting held by the San Francisco Peninsula, San Mateo County’s official tourism bureau. The cuts come even as California continues to outperform the broader U.S. tourism market.
“I hope we don’t have to revise this downward again,” said Beteta, who said she had planned to arrive earlier at the annual meeting but was delayed by an “onslaught” of texts from board members concerned about market volatility. On Wednesday, President Trump paused reciprocal tariffs on nearly 100 countries for up to 90 days, causing stock markets to surge after a week of battering losses.
Beteta focused much of her remarks on Canada, California’s second-largest international tourism market. She noted that some airlines had ended seasonal routes between Canadian cities and Palm Springs earlier than planned. Visit California is in daily contact with its Canadian office, working to ease tensions and maintain momentum, she said.
“We are in a unique position vis-a-vis the U.S.,” she said. “There is more empathy for us in California as being an inclusive, diverse destination. … We will be leveraging that.”
In the United Kingdom and Germany, agency officials say that travelers view California more favorably than the U.S. overall, according to Beteta.
“We are going to continue leaning into it,” Beteta said.
California remains the top travel destination in the U.S., with more than $156 billion in visitor spending last year. The state also added about 24,500 tourism jobs.
Zeek Coleman, vice president of the Americas at Tourism Economics, said trade tensions with Canada have hurt U.S. travel, while broader economic uncertainty is affecting business travel as well. Speaking Wednesday, he said U.S. consumers have shown surprising resilience.
“Somehow, if by some miracle the tariffs are rolled back and egos are restrained, we are in a good spot,” Coleman said. “If not, buckle up.”
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