That’s according to the latest Travel Trends Report from the Australian Travel Industry Association (ATIA).
For the year ending May 2025, outbound travel surged by 12.5% to 12.21 million trips, driven by a strong appetite for travel across Asia.
Standout growth included Japan (+32.4%), Vietnam (+25.8%) and China (+26.9%), reinforcing the region’s continued dominance for Australian travellers.
In contrast, the USA saw a mixed performance. Travel from Australia to the USA increased by 4.8% year-on-year and was up 8.0% in May 2025 compared to May 2024.
However, U.S. inbound travel to Australia slipped by 3.7% in May and remained flat year-on-year with a modest 0.6% rise.
On the inbound side, 8.37 million international travellers arrived in Australia in the year ending May 2025, a 5.6% rise on the previous year. China, India and Japan delivered the strongest growth, while the USA’s performance was subdued.
“Asia continues to shine as the preferred playground for Australian travellers, with Bali, Tokyo and Ho Chi Minh City topping itineraries for millions,” said Nina Hedges, ATIA Director of Compliance & Membership.
“The USA remains popular with outbound travellers, but the muted inbound response highlights challenges in achieving a balanced two-way tourism recovery.”
Domestically, Melbourne-Sydney retained its title as Australia’s busiest city pair, with 811,371 seats flown in April 2025.
However, capacity on this route declined slightly by 1.7% year-on-year, reflecting broader fluctuations across key domestic routes where capacity changes ranged from +7.4% to -6.6%.
International aviation also saw continued reshaping. Qantas Airways remained the top international carrier in March 2025 with a market share of 16.5%, while Jetstar grew its share to 12.3%, up from 11.1%.
Singapore Airlines held steady at 9.0%, highlighting strong performance by Australian-based and Asia-Pacific carriers.
Holidays remain the top reason for travel, peaking at 63.6% in October and staying above 60% for most of the year.
Travel to visit friends and relatives remains a significant segment, especially early in the year, with business and other travel reasons making up smaller proportions.
