Holiday Travel 2025: Less Spending, More Generational Shifts — Deloitte’s New Forecast

The Deloitte Holiday Travel Survey 2025 reveals that Americans still want to travel during the holiday season but are doing so with greater caution. Financial uncertainty, rising costs, and restrained consumer confidence — even among wealthy households — have made the winter of 2025–2026 look quieter than the previous one.

More Trips, Smaller Budgets

For the first time in five years, over half of Americans plan to travel between Thanksgiving and early January. However, much of that growth comes from those staying with friends and relatives rather than in hotels. The average trip length and frequency have declined, and budgets have dropped by 18%, down to $2,334 per person.

Nearly one in three respondents (31%) say their financial situation has worsened compared to last year. Even households earning more than $100,000 annually are tightening their belts — cutting trip lengths, choosing more affordable hotels, and increasingly opting for road trips instead of flights.

About 57% of travelers admit they’re choosing to drive primarily to save money. For the travel industry, this shift means pressure on key performance indicators — from RevPAR to airline load factors.

The “Cautious Class”: High Earners Scale Back

One of the most surprising trends is the decline in confidence among high-income Americans. In 2024, only 13% of respondents earning over $100,000 said they were worse off financially; in 2025, that number has risen to 19%.

Roughly 80% of these “cautious class” travelers plan to modify their habits to travel more cheaply, compared with 58% among those in stable financial condition. These cuts affect not just airfare but also hotel stays and on-site experiences.

For an industry that relies heavily on premium spenders, this trend poses a challenge: high earners traditionally drive significant revenue in both corporate and luxury travel segments.

Gen Z and Millennials: Now Half of All Travelers

For the first time, Gen Z and millennials account for 50% of all U.S. holiday travelers — a generational milestone reshaping travel demand. Millennials remain the biggest spenders, with an average travel budget of $2,602, while Gen Z continues to expand its travel participation.

They’re not only traveling more — they’re planning differently:

Over half of Gen Z travelers seek inspiration from short-form videos.

Generative AI usage for trip planning has increased 1.5x in just one year.

This digital engagement is redefining how travel brands compete. To win younger audiences, companies must go beyond discounts — offering personalized, tech-driven travel experiences.

Luxury Persists Despite Economic Pressure

Even amid tighter budgets, one in four travelers still falls into Deloitte’s “luxury traveler” category — those who have stayed in hotels costing $400+ per night over the past two years. These travelers are twice as likely to book first-class tickets and place greater emphasis on service quality and loyalty programs.

Experts say retaining this segment will be crucial for airlines and hotel groups. Personalization, flexible programs, and high-end customer experience will define market competitiveness in 2026.

What to Expect from the 2026 Travel Industry

The year 2025 has become one of recalibration. Travel remains an essential part of life, but consumers are behaving more pragmatically under financial pressure. Deloitte predicts that the travel market will continue to adapt — with demand shifting toward shorter trips, road travel, and flexible budgets, while digital tools become the new standard for planning.

Experts at International Investment emphasize:

“Reduced spending doesn’t mean reduced interest in travel. On the contrary, the market is becoming more mature and tech-oriented. The key challenge for airlines and hotels is to preserve the emotional value of travel while keeping it accessible and personalized.”