Tour Operators

SIC 4725

Companies in this industry

Industry report:

This classification is comprised of establishments primarily engaged in arranging and assembling tours for sale through travel agents. Tour operators primarily engaged in selling their own tours directly to travelers also are included in this industry.

Industry Snapshot

Within the U.S. travel and tourism industry, the packaged tours industry is the second largest revenue-producing sector of the travel services group. In the late years of the first decade of the 2000s, the entire travel and tourism industry was the nation's leading services export and the third-largest retail industry following automotive dealers and food stores. To provide some perspective on the enormity of the economic impact of travel and tourism on the U.S. economy, in 2008 the U.S. travel industry received nearly $800 billion from domestic and international travelers. The industry provided some 7.3 million jobs in the United States with a payroll of $175 billion.

Tour operators earn their revenue from this enormous market by providing a variety of travel services to a travel agent, who sells them to tourists. The types of tours provided differ according to the type of tour operation, ranging from arranging transportation, lodging, meals, and a guide for a week-long, gorilla-tracking expedition in Africa to the simple service of providing newly arrived guests to Hawaii with ceremonial leis. Tour operators frequently offer advantages of lower price, grouped travel with others of similar interests or same socio-economic level, predetermined costs, and pre-planned activities.

Historically, tourists who have chosen to arrange their vacations through a tour operator rather than through a travel agency do so for several different reasons, which over the course of the modern travel industry's existence have fluctuated in their relative importance to the tour operator industry. Initially, tourists were attracted by the inexpensive total price of their vacations when purchased from a tour operator. They also preferred to travel with a group, have the trip's budget determined beforehand, and not worry about what to do, where to go, and how to get there. These benefits, along with economy and ease of travel, motivate consumers to consider a tour package, essentially keeping the industry alive. Throughout the tour operator industry's history, these advantages attracted some of those contemplating travel, although the number of tourists motivated by economy and ease of travel has varied during different phases of the industry's history.

As time progressed and more people found the time and the extra finances to travel, the tour operator industry began to attract a new type of customer not necessarily interested in traveling with a group or particularly interested in saving money. These tourists had traveled to numerous destinations numerous times, becoming somewhat inured to the attraction of a particular destination. For example, instead of traveling to France for the seventh time, a tourist might consult with a tour organizer to arrange a trip to France specifically tailored to the tourist's interests. These types of tourists represented a growing part of the industry's customer base and led to the creation of fantastic, sometimes eccentric, tours.

Organization and Structure

On a broad level, the two types of businesses that generate revenue from arranging transportation and entertainment for tourists are wholesale travel businesses and retail travel businesses. Tour operators generally function as wholesalers, although like travel agencies, they may operate as retailers or as both. Wholesalers in the travel industry secure large blocks of hotel rooms, sections of seats on an airplane, or large volumes of any other travel-related commodity by paying a deposit for such reservations. For instance, by reserving 200 rooms in a particular hotel, the wholesaler receives a discounted price from the hotel operator, primarily because the wholesaler has assumed the risk of having the 200 hotel rooms remain vacant, a risk the hotel operator would otherwise assume. To generate revenue and mitigate its newly assumed risk, the wholesale concern then attempts to occupy those 200 hotel rooms with tourists by selling the rooms through a retail concern. The distinction between the wholesaler selling through the retailer rather than to the retailer directly is an important one, because the retailer, usually a travel agency, does not pay for the block of rooms and assume the risk, but only attempts to find occupants for the rooms for the wholesaler, for which the retailer receives a commission from the wholesaler.

Frequently, as a result of the vertical integration by the travel industry, a travel wholesaler also may own a travel retail business and, if so, functions as a wholesaler and a retailer, reserving large blocks of transportation or lodging space, then selling them directly to tourists through its retail travel agency. Some tour operators operate as such, selling tour packages directly to tourists, whereas others sell tour packages through retail travel agencies. In both cases, the tour operators assume the risk that the tours offered may not attract any customers. Multi-mode tours are increasingly included in travel packages, such as cruise-tours using planes, boats, and buses.

The many types of tours offered by tour operators generally fall under four different tour categories, although a particular tour may incorporate characteristics from more than one category. Tours may be designed and organized to suit the desires of a specific group of tourists, such as a tour of Rome organized exclusively for lawyers, or a tour of the museums in Rome for art lovers. Tours of this type are known as special-interest tours, which may or may not be led by a tour guide. In early 2000, the Yahoo! Web site listed 36 specialized tour categories with 946 listings under all categories. By 2007, Yahoo! showed 10,391 listings in 81 specialized categories under the heading "tour operators." Boat charters led the group with 382 sub-listings, followed by fishing (332), adventure tours (314), hunting (309), and safaris (296). Other popular categories included sailing charters, eco-tours, whitewater rafting, cycling, and scuba and snorkeling. Among the more unusual were bear watching, space tours, storm chasing tours, and naturist tours.

According to the United States Tour Operators Association (USTOA), new trends in specialized tours include packages aimed at baby boomers, homosexuals, and history buffs. The group claimed one of the fastest growing niches for consumers and the industry was minority travel. It also noted an increase in the number of Hispanic agents. In addition, there was a growing trend for adopted children and their U.S. families to visit their native lands of Asia, Europe, and Latin America. In 2005, Trafalgar Tours introduced a product line called "Trafalgar Experiences," reflecting the trend to capture the essence of destinations with activities such as cooking lessons, wine tastings, and language classes.

Tours that are led by a tour guide and are comprised of a group of tourists not necessarily familiar with each other are classified as escorted tours. During these tours, a tour director travels with the group and assumes responsibility for confirming hotel reservations, scheduling transportation, overseeing the handling of baggage, leading sight-seeing excursions, and providing language translation when necessary. During escorted tours, travelers generally follow a scheduled itinerary created by the tour operator and travel as a group to appointed destinations at predetermined times.

Foreign independent tours (FIT) or domestic independent tours (DIT) allow travelers more freedom to vacation on their own without following a scheduled itinerary or traveling with a group, yet these tours offer the traveler the convenience of paying for all facets of a trip prior to departure, including transportation, transfers, lodging, sight-seeing excursions, and often some meals. This type of tour is divided into two varieties: those tourists traveling on an independent tour outside their home country are on a FIT, and those traveling inside their home country are on a DIT.

Group inclusive tours (GIT) are the fourth category of tours offered by tour operators and are comprised of groups of travelers that share a particular mutual affiliation, such as belonging to the same club or business organization. This type of tour differs from an escorted tour in that the travelers in a GIT share a commonality, while the members of an escorted tour share no common bond other than perhaps living in the same region. GITs also are different from special-interest tours, not because of the composition of the tour members, but because of differences in the tours themselves. Tourists on special-interest tours travel to a particular destination for an experience that reflects their mutual interests, and travelers in GITs form a group merely to pool their purchasing power and realize savings.

Some tour operators offer travel services only after the tourist or group of tourists arrive at their destination. These tour operators, known as ground operators, often specialize in a particular destination, and consequently are located near the particular destination. As a result, many tour operators are in regions of the United States that are typically thought of as popular tourist destinations, such as California, Florida, and Hawaii.

Although the tour operator industry is densely populated, the capital required to enter the business is relatively high, making entry into the industry more difficult. Because tour operators generate revenue by paying large deposits for travel commodities that they anticipate will be paid for by future customers, the fledgling tour operator must have enough capital to secure the necessary reservations without first having generated any revenue. Moreover, the tour operator is required to pay in full for reserved travel commodities, whether or not the tour attracts any tourists, putting the large deposits at risk. Consequently, the number of tour operators is constantly in flux because some companies fail, particularly small ones with limited cash reserves, and new companies are established.

Professional Associations.
There are two principal associations for tour operators. The USTOA membership consisted of more than 700 members representing more than 125 of the most influential brand names in the travel industry in 2011. Members generated more than $9 billion in sales and more than 11 million passengers for the industry. Members must meet the industry's highest standards. They must provide 18 references from a variety of industry sources and financial institutions and meet specific minimums in terms of tour passengers or dollar volume. They also must participate in the USTOA Travelers Assistance Program. The million-dollar security is in the form of a bond and is used solely to reimburse consumers for tour payments or deposits lost in the event of bankruptcy, insolvency, or cessation of operations involving an active USTOA member. As of 2011 the National Tour Association (NTA) had 1,500 tour operator members and 600 destinations. In 2003, it began an effort to support effective funding for state and local tourism offices or destination marketing organizations. The group also stressed the importance of not using travel taxes as a way to make up for lost revenue. Membership increased quickly in 2006 due to the organizations's efforts at diversification. The nations of Kazakhstan, India, and French Polynesia joined the group in 2006.

Background and Development

The concept of traveling for pleasure is a relatively recent phenomenon that emerged in the last half of the twentieth century, when society became more affluent, achievements in aviation made inexpensive air travel available to the masses, and the basic desire to spend vacations away from home combined to make travel, and particularly long-distance travel, a popular and widespread activity. It is unclear whether this transformation of the human mindset was merely the product of people suddenly and inexplicably eager for travel, or the result of effective marketing by national governments and commercial interests. Whatever the root of the new desire to travel, it did not surface until the beginning of the jet age.

For Americans, travel by plane became available in the 1930s when airline service was established. However, many could not afford to fly, and perhaps even more felt no desire to fly, preferring instead to remain close to home. It was not until after World War II that Americans began traveling by plane to any appreciable extent, an activity facilitated by a dramatic increase in their discretionary income and the affordability of travel. Even then, not many traveled, at least not by plane, and it would be another 20 years until more than one in two Americans had flown in an airplane. Nevertheless, once Americans began to travel in the 1950s, tour packages designed and arranged by tour organizers appeared immediately, signaling the genesis of the modern tour operator industry at about the same time the overall travel industry began to mature into a formidable economic force.

Of course, the tour operator industry did not wholly depend upon air travel to generate revenue. Busloads of high school and college students traveling together during spring vacations during the 1920s most likely constituted the formal beginnings of the industry. Nevertheless, the business created from those traveling to foreign countries or across the United States by airplane had a significant effect on the development of the industry. During the 1950s, the tour operator industry benefited from several key attributes peculiar to the experience tour organizers offered. First and perhaps most important, tour packages were generally more affordable than traveling independently. Packages usually offered inclusive fares, leaving the tourist with little to pay for after departure and virtually no travel details to arrange before departure or once traveling. Group travel also offered companionship in unfamiliar places and unfamiliar cultures. Many tourists traveling during the 1950s were experiencing their first trip of any distance from home. Travel for some represented a somewhat frightening, but exciting, endeavor. The tour operator industry was well equipped to alleviate this sentiment with comparatively inexpensive prices, the convenience of pre-arranged travel plans, and the security and camaraderie provided by group travel. The tour operator industry secured a viable foothold in the then burgeoning travel industry, establishing a particular type of clientele for itself that consistently fueled its growth.

By the beginning of the 1960s, tourism was big business, amounting to approximately $30 billion a year in the United States. Nearly 124 million Americans traveled each year during the early 1960s. An appreciable portion traveled internationally, spending more than $2 billion annually in foreign countries. During the 1950s, international travel became enough of an economic force to attract the attention of government officials. In fact, the Eisenhower administration's attempts to incorporate travel as a focus of foreign economic policy led to the formation of the U.S. Office of International Travel in 1958. Although no branches were established overseas, the Office of International Travel acted as promoter and served as a liaison between the travel industry and government agencies affecting the industry's operation abroad.

Despite federal promotion, several years after the creation of the Office of International Travel, the number of U.S. tourists traveling overseas still outnumbered the number of foreign tourists traveling in the United States. By the beginning of the 1960s, this gap had widened, creating an annual industry trade deficit of nearly $1 billion. In 1961, President Kennedy's administration created the United States Travel Service (USTS) as part of the International Travel Act. With more power than the Office of International Travel and with branches overseas, the USTS, operating within the Commerce Department, promoted travel to the United States and facilitated that travel wherever possible.

The proliferation of the International Travel Act and the subsequent creation of the USTS provided a tremendous boost to the tour operator industry, primarily because the USTS focused on persuading large groups of tourists to visit the United States. Large groups of people meant tours for tour organizers, who found themselves infused with business created by the government. With an initial $2.5 million annual budget earmarked for travel promotion, the USTS, through its Visit U.S.A. program, enabled tour operators to reach a much wider audience than their individual marketing budgets would have allowed. In one of the first successes of the Visit U.S.A. program, 400 Swiss tourists came to the United States, paving the way for additional groups numbering as high as 700 from Britain, France, and Germany.

While foreign travel to the United States began to pick up in the 1960s, another tour type began to grow in popularity. Exotic tours like safaris gave hunters an opportunity to shoot wild game in distant venues, such as Mongolia, Serbia, and Africa. Despite being considerably expensive, with mid-1960s prices between $3,000 and $9,000 excluding airfare, safari tours attracted up to 200,000 tourists each year by the end of the decade.

A larger niche within the tour operator industry experienced an increase in popularity, further bolstering the industry's record growth in the 1960s. This niche later became known as the special-interest tour for groups of people with mutual interests traveling together to a particular destination. Some of these tours offered no savings to the group traveler when compared to traveling alone. This development, along with the growing number of people paying for expensive safari tours, signified a subtle but crucial change in the reasons tourists selected tour organizers to arrange their vacations. Previously, lower vacation costs were the primary advantage tour operators offered tourists, and in the 1960s that continued to support the industry's existence. However, tourists began to choose tour operators due solely to their talent for organizing vacations. This evolution occurred slowly, but would prove to be one of the industry's primary selling points.

As the tour operator industry broadened its scope, the U.S. tourism deficit also continued to broaden. Despite the efforts of Kennedy's Visit U.S.A. promotional program, the tourism deficit had increased from $1 billion at the beginning of the 1960s to $1.6 billion by 1965, prompting the country's next administration to design a new international tourist program to somehow keep the gap from increasing.

Shortly after assuming office, the administration of President Lyndon Johnson created the See the U.S.A. program, similar to Kennedy's program in name, but with a decidedly different objective. Instead of only promoting travel to the United States from overseas, See the U.S.A. attempted to curb the number of U.S. citizens traveling abroad. For several years, the idea of levying a "travel-tax" of $50 to $100 was contemplated. Although the threat of an international travel-tax initially produced the opposite of its intended effect by spurring travel abroad before the tax was implemented, other components of See the U.S.A. essentially promoted U.S. destinations for U.S. citizens, which had a positive effect on tour organizers' business. Cities with warm climates and popular tourist attractions in states such as California, Florida, and Hawaii, benefited enormously from the promotional efforts of See the U.S.A., which encouraged travelers to vacation within U.S. borders.

The next significant federal involvement in the travel industry came in 1978, when the Airline Deregulation Act ended the regulation of domestic air transportation. Regulation had effectively made the industry a consortium of closely allied companies forming what resembled a cartel. Once deregulated, the airline industry assumed its own course of development, unfettered by the strict controls of the Civil Aeronautics Board, which had regulated the industry for the previous 40 years. The airline industry drastically reduced the airfares and quickly became a more populated industry, with 198 new airlines forming in the decade following deregulation. The travel agency industry responded in much the same manner, with the number of agencies soaring from less than 10,000 before deregulation to 28,000 by the mid-1980s. For members of the tour operator industry, airline deregulation resulted in an upturn in business.

Now catering to a market invigorated by less expensive airfares, the tour operator industry expanded rapidly, attracting new entrants into the business. Between 1973 and 1993, the number of tour organizers increased from approximately 350 to more than 1,500. This increase in participants led to a rise in the number of fallacious agencies, which hurt the industry for the next 20 years and enticed the government to consider regulation of the industry.

Aside from this undesirable manifestation of the industry's growth, the Airline Deregulation Act of 1978 also led to an increase in the industry's sales volume, as travel agents increasingly turned to tour operators to realize larger profits. The precipitous decline in airfare proved to be a boon for airlines, but travel agents who were dependent on commissions suffered from the drop in ticket prices. To ameliorate their position, travel agencies turned to tour operators and began selling more tours, which offered a much higher commission than less expensive airline tickets.

Buoyed by these beneficial developments as it entered the 1980s, the tour operator industry faced an additional regulatory change. In 1982, one of the final acts of the Civil Aeronautics Board, still in the process of dismantling itself after the 1978 Airline Deregulation Act, deregulated the sale of airline tickets in 1985. This decision ended a system that had allowed only airlines and travel agents accredited by an airline industry group to issue tickets. This practice had forced many tour operators to sell tours through retail travel agencies. With greater freedom to enter the retail market, tour operators continued to attract additional business and competition for the second consecutive decade.

As tourists sought more adventuresome and exotic tours in wilderness and other uninhabited areas, concerns about the ecological impact on these environments grew. In 1995, the National Parks Airspace Management Act sought to allow the National Park Service to control airspace above national parks in addition to directing the Federal Aviation Administration (FAA) to develop more stringent federal regulations for air tour operators. The act was aggressively fought by the United States Air Tour Association, as well as the Aircraft Owners and Pilots Association, because it would shift control over air space from the FAA to the Park Service, which both groups felt would be unacceptable. The air tour operator industry noted that aircraft flying over the Grand Canyon, the central focus of the contested airspace, flew well-defined corridors away from popular areas, over only 14 percent of the entire Grand Canyon National Park. It also was noted that complaints had decreased 92 percent, from 100 to 8 complaints per million visitors. The National Park Service reported that 92 percent of respondents to a survey reported no adverse sound impact from overflights.

The strength of the national air tour industry also was noted. The estimated impact of the air tour industry was $625 million. The 275 air tour operators conducted 285,714 flights in 962 aircraft during 428,571 flying hours and carried 2 million passengers annually, 1.2 million of whom were foreign passengers. There were 240,000 handicapped passengers who flew on air tours. The accident rate was 1.9 per 100,000 hours flown. There was no environmental impact of air tours on the ground, according to the USATA.

Entering the twenty-first century, two key issues dominated the industry: the trend toward mergers, and competition from Internet providers. Forrester Research reported that more than $12 billion in revenues was generated from online bookings in 1999. However, the travel industry suffered most in the wake of the September 11, 2001, terrorist attacks against the United States and a weakened U.S. economy. Some of the largest airlines, including United, declared bankruptcy. Faced with new security restrictions, increased operating costs, and ebbing international tourism, tour operators were still feeling the effects of September 11 long after the attacks. Tour operators brought in an estimated $2.8 billion in 2001, down slightly from more than $3 billion in 2000, according to the U.S. Census Bureau. Tour operators noted a 60 percent drop in travel bookings after September 11, similar to the drop following the 1991 Gulf War.

Travel expenditures, including spending by U.S. residents and international travelers in the United States on travel-related expenses, were $555.2 billion in 2001, down from $591.2 billion in 2000. International arrivals to the United States declined nearly 12 percent in 2001, which was the worst decline for a single year in the history of tracking international arrivals to the United States. Declines continued in 2002, off 7 percent from the previous year. Leisure travel in particular began to decline at the end of 2002 and in early 2003. Contributing factors included the heightened security alert in the United States and the war in Iraq. Americans planned 171.2 million leisure trips in spring 2003, which was a decline of 1.6 percent from spring 2002. Domestically, leisure travel accounted for 76 percent of all travel.

Tour operators received another blow from a surge in negative publicity regarding the outbreak of illnesses on various cruise lines in the early 2000s. For example, the Holland America Line took one of its ships out of service for an intensive cleaning after a stomach virus spread, sickening hundreds of people on four separate cruises. Additionally, due to the outbreak and spread of Severe Acute Respiratory Syndrome (SARS) in Asia, several tour operators who specialized in trips to that area were forced to close. Others saw large drops in travel.

To offset the decreasing desire to travel to foreign destinations, many tour operators began adding programs to national parks in the U.S. West, including Zion, Grand Canyon, Bryce, Yellowstone, and Grand Teton national parks. Family tours also began gaining in popularity. In whatever form it took, tour operators diversifying their products seemed to be an important trend, and single-destination operators suffered the most in the current volatile market.

Online companies continued to be the major source of competition for tour operators and travel agents in the 2000s. In 2003, travel agent sales dropped 14 percent from the previous year, to $5.9 billion. Online travel service leaders such as Travelocity, Expedia, and Orbitz were poised to take over from tour operators, with several industry analysts predicting that most tour operators would eventually join with online companies to boost business. Expedia's acquisition of Classic Custom Vacations in 2002 seemed to hearken the beginning of such a trend. Others disagreed, asserting that while online travel purchases were rising, most travelers used the Internet for research rather than booking, and more complex travel arrangements were better left to the experts. Indeed, travel agents continued to sell the majority of leisure travel in the mid- and late 2000s.

By 2007, approximately 90 percent of airline tickets were purchased electronically. As the leading services export industry, in 2008 the U.S. travel industry received nearly $800 billion from domestic and international travelers. The industry provided about 7.3 million jobs in the United States with a payroll totaling $175 billion.

In September 2007, Travel Weekly reported the Department of Transportation (DOT) had recently assessed $185,000 in fines against several tour operators for allegedly violating DOT fare advertising rules. The fines brought about a call from the U.S. Tour Operators Association to demand clearer guidelines from the DOT. The DOT's guidelines cover advertisements by airlines, tour operators and travel agents for air travel or for packages including air travel, and require that ads cite the entire price, including surcharges. However, airline surcharges, such as fuel surcharges, can change often. Before these guidelines are set, tour operators have to work, sometimes more than a year in advance, with the airlines that continually change their prices, making it hard for the tour operator to maintain prices listed to their customers.

Current Conditions

After suffering from the lull in travel caused by the economic recession of the late 2000s, the tour operators industry was set for recovery by 2011. According to a report by IBISWorld, "As both domestic and international travel rates improve, demand for tour operators' services will rise." This growth will be aided by a recovery in the economy, and tour operators will seek to attract customers by offering "more exotic destinations and unique experiences." Developing markets abroad, such as in China and Russia, were also expected to aid in industry growth.

Others were not quite as optimistic about the industry's near future. According to Bill Poling of Travel Weekly, potential U.S. travelers continued to struggle with "'the process,' a word that sums up the myriad hassles that affect domestic and international travel, such as obtaining passports and visas, getting to and through the airport and getting through customs and other border controls." The state of the economy and the amount of discretionary income in the average American's pocket were also thought to be difficult to predict, and thus the health of the travel industry in 2012 and following years remained "as uncertain as ever."

Industry Leaders

Aside from large travel, passenger transportation, and entertainment concerns that also sell tour packages, most independent tour operators are small and privately held.

The industry's Tour Operator Program (TOP), under the umbrella of the American Society of Travel Agents, developed several safeguards to protect consumers from fraud or misrepresentation. Tour operators must have been in business for the past three years, must participate in one of four approved consumer protection plans, subscribe to a one-million-dollar errors and omissions policy naming travel agents as additional insurers, accept travel agent bookings and pay commissions, comply with federal and state travel regulations, respond to Better Business Bureaus´┐Ż and other complaints within 30 days, and subscribe to a prescribed code of ethics. The four protection plans with a brief description of their coverage are outlined below.

The USTOA requires that a $1 million security deposit in the form of a bond, letter of credit, or certificate of deposit be used solely for reimbursing consumers who have lost tour payments or deposits because of the bankruptcy, insolvency, or cessation of operations of one of its active members. The funds also are available to consumers whose company failed to refund monies within 120 days of cancellation of a tour or package.

The NTA's Consumer Protection Plan applies to qualifying deposits or prepayments for packaged travel placed by a travel agent on behalf of the consumer. Losses are limited to $250,000 per bankrupt member, with maximum liabilities limited to the total assets of the fund at the time.

The Travel Funds Protection Plan is an escrow account for individual deposits in agreement with tour operators and the bank. The deposit account is controlled by the First Bank of America, automatically debits airfare, and releases payment to the tour operator for land and lodging related-costs five days after the tour is complete. No portion of the consumer's money is available to the tour operator in the interim.

The Federal Maritime Commission Program requires owners, operators, and charters of vessels with accommodations for 50 or more passengers embarking from U.S. ports, including territories and possessions, to demonstrate fiscal responsibility in the form of a surety bond, financial guaranty, self-insurance, or an escrow account to protect passengers against loss in the event of nonperformance of water transportation.

America and the World

International visitors generated an estimated $125 billion in U.S. travel revenue in 2008. Since the late 1980s, the United States has held a trade surplus in travel expenditures, which means that international tourists spent more in the United States than U.S. travelers spent abroad. For the first time since 1985, exports for merchandise goods dropped to $719 billion in 2001. Service exports also dropped in 2001, from $292 billion in 2000 to $279 billion in 2001. That marked the first decline ever registered in service exports for the United States from 1960 to 2001. Florida, California, New York, Hawaii, and Nevada were leading U.S. destinations for foreign travelers. Residents of Canada, Mexico, Japan, the United Kingdom, and Germany made up more than half of the international visitors to the United States. The top five markets to the United States in 2008 were Canada (18.9 million visitors), Mexico (13.7 million visitors), United Kingdom (4.6 million arrivals), Japan (3.2 million), and Germany (1.8 million). The United Kingdom surpassed Japan in 2001 to become the largest overseas market for the United States. The top five countries in terms of tourist dollars spent in the U.S. in 2008 closely reflects the number of visitors. Canadian visitors spent $18.7 billion in the U.S., United Kingdom visitors spent $16.7 billion, Japanese travelers spent $14.6 billion, Mexican visitors spent $9.7 billion, and travelers from Germany spent $6.7 billion.

International travel by residents of the United States has grown steadily. In 2006, 30.1 million U.S. residents traveled overseas, a 5 percent increase from 2005. Top international destinations for U.S. travelers in 2006 were the United Kingdom, France, Italy, Germany, and Jamaica. Most travelers left the country from New York City, Washington, D.C., Los Angeles, Miami, Chicago, and San Francisco, in descending order. The International Council of Tourism Partners pledged to promote trips to Africa as a way to alleviate poverty. It plans to greatly increase the amount of international travel and revenue generated there.

In 2011, Italy was ranked the top international destination for tours booked by travelers from the United States. Australia and the United Kingdom tied for a distant second place, according to USTOA.

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