McKinsey: Europeans’ summer vacation sentiment is up - the US market is sluggish

European consumers are planning to spend more on travel and vacation-related services in the coming quarter, according to McKinsey’s latest Q2 2025 ConsumerWise survey.

According to the survey’s discretionary spending categories, European consumers plan to spend more than usual on cruises, international flights, hotels and short-term rentals, indicative of typical seasonal vacation spending.

Cruising is the fastest-growing discretionary tourism service, with a significant increase in spending intentions among most Europeans, especially Germans, Britons, and Italians, for whom it is the number one reason for increasing discretionary spending in the coming quarter. Specifically, 29% of Germans, 17% of Britons, 20% of French, 27% of Italians, and 13% of Spaniards plan to spend more in the coming quarter.

19% of Germans and Britons, 14% of French, 22% of Italians and 19% of Spaniards plan to spend more on international flights.

A stronger increase in spending on hotels than on short-term rentals

In terms of spending on hotels, 22% of Germans, 20% of Britons, 16% of French, 26% of Italians, and 19% of Spaniards plan to spend more. These figures are considerably higher than the proportion of people who said they would increase their spending on short-term rentals (16% of Germans, 17% of Britons, Italians, and Spaniards, and 15% of the French).

Meanwhile, only 37% of European consumers said they intend to overspend in the coming quarter (45% of Germans and 34% of Britons). Of these, 34% will do so on food and beverage services (bars and restaurants) and 31% on travel, which are the second most important service categories in high-spending intentions.

In terms of purchases, travel is the second most important category for high spending by Germans (32%), Britons (29%), and French (38%). For Italians, it is the absolute top spender (34%), while for Spaniards (32%), travel is in third place after clothing and dining.

Millennials, Gen X and Baby Boomers consider travel to be the most appropriate service for high spending, at 32%, 38%, and 44% respectively, while the lowest percentage is recorded for Gen Z (23%), who prioritize clothing, dining, footwear, and beauty and personal care products.

Americans are restrained in their high spending on travel

Overall, European consumers reported a slight increase in the likelihood of spending on both discretionary and non-discretionary categories. This picture contrasts with consumers in the United States, where pessimism increased in the weeks following the tariff announcements. It also contrasts with declines in consumer sentiment in Europe seen during previous major upheavals, including the COVID-19 pandemic, the outbreak of war in Ukraine, and recent increases in inflation.

Notably, according to the same survey, travel for Americans, as a high-spending priority, is in fifth place in the relevant ranking (28%), after buying food for the home (35%), dining out (34%), clothing (31%) and beauty and personal care products (30%).