As Market Settles, Corps. Largely Maintain Tentative Approach

After a tumultuous March and April that featured a broad range of new U.S. tariffs, strains in international relations and softening U.S. domestic leisure and some inbound international travel, May brought a bit of relative tranquility, with postponements of some of the most consequential tariffs and a rebounding market. Still, though, many corporates remain hesitant with regard to business travel, eschewing both aggressive increases and deep cuts as they wait for more clarity about future economic conditions, according to observers.

President Donald Trump in April levied a series of tariffs on dozens of nations, including allies, and issued new executive orders governing the screening of visitors and immigrants to the United States. The moves shook the market and led some companies to reconsider business travel, in particular international travel to the United States. But the U.S. and China agreed on May 12 to postpone many reciprocal tariffs, which some observers viewed as the most economically significant, for 90 days to craft a deal. (A three-judge U.S. panel on May 28 additionally ruled that Trump did not have legal authority to levy the Liberation Day tariffs.)

Companies’ reactions to Trump’s policies have varied, as have their approaches to corporate travel in their wake, according to panelists on a May 12 BTN Intelligence News Desk who sought to define the dynamics shaping the current market.

“It’s really hard to draw conclusions right now,” said Greeley Koch, managing director of consulting firm 490 Consulting. “It’s so individualized right now by company that it’s somewhat hard to be making predictions. I’ve talked to some construction companies and they’re like, ‘We’re full speed ahead. Our projects were fully funded, we have no change there.’ I talked to others in architectural design and they’re like, ‘Well, some projects have been put on hold because companies are not sure about the costs of building due to tariffs.’ … Even within certain industries, it’s kind of a mixed bag.”

Areka Consulting SVP of North America Charles Bacharach agreed that firm conclusions on corporate travel demand were difficult to pinpoint.

“We have some clients in the consumer package goods industry that are a bit more concerned than some in oil and gas and some of the more heavy-industry type profiles,” Bacharach said. “Depending on the organization, CFOs are looking at it and saying, ‘Hey, where we can be conservative, let’s do so. Let’s have the right reasons for travel and make sure they’re making the right decisions given this unknown situation that we sit in.’ I think the uncertainty will continue until a full deal is hammered out.”

Bacharach suggested that such a conservative approach to travel could include measures including additional pre-trip approval procedures or more comprehensive communications strategies about directing travelers to exercise restraint, rather than deploying deep spending cuts or travel freezes.

The 90-day pause of the tariffs between the U.S. and China likely isn’t sufficient for many companies to aggressively embrace travel, Koch said, instead waiting for a more permanent resolution.

“We have a 90-day pause now on China, but that doesn’t really give us the complete certainty that companies need,” Koch said. “I think we’ll still see this pausing of travel. In some cases, with those companies that are impacted by the tariffs and are looking at their margins, we might see a reduction, but I think otherwise we’ll just see a pause.”

Bacharach agreed many corporates remain tentative but noted the tariff pause represents a measure of progress.

“I was on a call this morning and with a client, and they characterize their current situation as a traffic light: It isn’t a red light, it isn’t a green light, it’s a flashing yellow light in terms of what they’re doing [in] planning in a travel perspective,” Bacharach said. ” I think we’ll still see that flashing yellow light until there is clarity on developments past the 90-day period of time. But I do think that there’s been a sigh of relief that there’s progress made. The parties are at the table, they’re talking to each other, which in the middle of April we couldn’t say.”

Quantifying Demand

Generally speaking, recent releases of travel statistics of show a mixed bag of corporate demand. Airlines Reporting Corp. managing director of industry standards and best practices Hansini Sharma said the number of air tickets sold by U.S. corporate agencies and settled by ARC in 2025 through the announcement of Trump’s Liberation Day tariffs increased 2.5 percent year over year, but afterward through May 12 decreased 4.6 percent year over year. 

Those figures are a bit noisy due to the timing of Easter, around which business travel traditionally slows and which was March 31 last year and April 20 in 2025. 

“I do think it’s still too volatile to know if tariffs themselves are really impacting corporate travel directly,” Sharma said. “On the leisure side, we’re seeing a little bit of a softening, but there’s still growth overall and globally too.”

Meanwhile, after an April in which the U.S hotel occupancy rate fell nearly 2 percent year over year—a figure again affected by Easter—hotel analytics firm STR noted some softness in demand in the early parts of May, which in a statement it called “a surprise” and speculated about a link to economic uncertainty. 

Looking forward, STR noted “mixed indicators ahead. Forward bookings are softer for the coming months with bookings positive in May, flat in June and then down for July and August.” 

The International Situation

STR also noted that the number of Americans traveling internationally is increasing—a trend it suggested could slow as the strength of the U.S. dollar versus other currencies wanes—but inbound international U.S. travel has slowed. 

Bacharach and Koch noted that the reluctance of some business travelers and meeting managers to travel to or plan international events in the United States could increase demand elsewhere. 

“There is concern about the inbound components, especially around the changes in how the Border Patrol is operating and the documentation you need coming in” to the United States, Bacharach said. “We have one client who took a global meeting that was going to take place in the States and moved it to the U.K. instead just to avoid any kind of friction or issue of their traveling population.”

Koch suggested that “it’s almost like the old shrinking of the balloon: You’re pushing on the balloon, but [the air is] still going to go somewhere. And I think in this case, the impact to the U.S. could be a gain for other countries and other destinations.”

Still, some measures of inbound U.S. international travel rebounded in April. According to preliminary U.S. International Trade Administration data, the number of international visitors to the U.S. in April, excluding those from Canada and Mexico, increased 8 percent year over year. Those entering on business visas or through the Visa Waiver Program in April, again excluding Canada and Mexico, declined 8.7 percent year over year after increasing in March, according U.S. National Travel and Tourism Office, a change that the Easter shift could have contributed.

Trips from Canada to the United States in April remained down, according to Statistics Canada, a Canadian federal government agency. In April, Canadian residents’ return trips from the United States via air declined nearly 20 percent year over year even as return air trips from other countries declined less than 2 percent. Return trips from the U.S. by car in April, meanwhile, dropped 35 percent year over year,

Some Canadian leisure travelers have boycotted travel to the U.S. following word of Trump’s tariffs and his repeated suggestions that the country should join the U.S. as a state. 

Vancouver, B.C.-based corporate travel agency Inspired Travel Group president Max Hansen late last month told BTN that while the situation generated less impact on Canadian business travel than leisure trips, cross-border travel nevertheless was down about 20 percent in the prior months year over year.

“There’s just certain things that you just have to kind of keep the wheels in motion on: You have to go see your suppliers, you have to see your clients,” Hansen said. “But there definitely has been a decrease.”

Hansen said some Canadian companies are reluctant to fund business travel to the U.S. because they’re less sure of a return on investment given the turbulent economic and tariff situation. “I think until that irons itself out, then we can start to see some stability and make some progress because ultimately economies and businesses want stability. They want certainty.”