Global air traffic grew in 2025, but IATA’s RPK data show that the recovery became increasingly uneven. Total revenue passenger kilometers (RPK) increased by 5.3% in 2025. Africa saw the largest growth with 9.4%. Asia Pacific and Latin America also posted strong results at over 7%. Europe matched the global average at 5.3%, but North America was the clear outlier with RPK growth of just 0.4% internationally. The weakness was even more striking in the U.S. domestic market, which declined by 0.6% in RPK terms (see chart below).

US Domestic Market Performance

The domestic market was at the heart of the U.S. underperformance. Domestic passenger traffic declined by 1.3% in 2025, and the weakness was visible across several of the largest carriers. Southwest, American Airlines, Spirit, and JetBlue showed lower domestic volumes in 2025 than in 2024, while Delta was stable, United grew, and Alaska, Frontier, and Allegiant were broadly flat to modestly positive.

The U.S. domestic market had a strong post-COVID recovery in 2022-2024. Unlike Asia-Pacific, Latin America, or Africa, the country had less remaining catch-up demand. In 2025, domestic traffic resumed the characteristics of a mature market, with growth dependent on confidence, disposable income, air fares, and airline capacity.

These drivers all weakened in 2025. U.S. GDP grew, but consumers became more cautious due to inflation concerns, tariff uncertainty, and weaker expectations. As a result, airlines cut capacity to protect yields. This was concentrated in price-sensitive domestic leisure demand. Low-cost carriers (LCCs) were hit hardest by the weaker demand because they rely more heavily on price-sensitive leisure passengers, while full-service carriers were better supported by premium, loyalty, and international long-haul revenue streams.

This trend continues into 2026, although slightly more moderate. Data from the first two months of the year shows a 0.3% reduction in domestic passengers compared to 2025. Higher fuel costs add a further risk, requiring airlines to pass on costs where demand allows, and reduce capacity where it does not. For airports, this means that large hubs and resilient leisure/VFR routes may grow, but smaller, LCC-dependent and price-sensitive domestic markets remain more vulnerable.

US International Market Performance

A contrasting trend was seen in the international market, where passenger numbers in 2025 were broadly stable compared with 2024. However, the composition changed. U.S. citizens continued to make up an ever-larger share of the market, while foreign-origin passengers declined (see chart below). The number of foreign passengers traveling to the U.S. fell by 3% in 2025, whereas U.S. outbound grew at roughly the same rate.

Looking at Q1 2026, there was a continuation of this trend, with foreign visitors falling by 4% compared to the same period last year, and now also a small decline of 0.1% for U.S. citizens traveling internationally.

The reasons for the reduction in foreign travelers were mixed: a strong dollar effect, weaker foreign sentiment toward the U.S., visa/border concerns, and geopolitical/policy uncertainty. Canadians, Mexicans, and Colombians, in particular, traveled less to the U.S.

The growth of Americans traveling abroad can be explained by the following reasons:

• While the domestic slowdown was concentrated in price-sensitive leisure and budget-carrier demand, premium and higher-income travel held up better
• International trips, especially long-haul Europe/Asia trips, are more often taken by higher-income households that are less affected by inflation and consumer confidence pressures
• Where domestic pricing power weakened, airlines concentrated on maintaining capacity in stronger international and premium markets, thereby facilitating foreign trips.

As can be seen in the statistics per country (see chart above), besides Canada, where a strong decline in visitors could not be offset by U.S. citizens, other key markets held up relatively well in 2025. These destinations saw more U.S. citizens while foreign travel to the U.S. weakened. On balance, the growth trend of recent years was broken, and international passenger volume did not grow.

Looking forward, airports and tourism destinations that rely heavily on U.S. outbound demand may still benefit, particularly in leisure/VFR and premium segments. However, Q1 2026 shows that this is also under pressure and growth is likely to be more elusive, and more sensitive to fares, exchange rates, and airline capacity decisions.