Investing.com - Tariff-fueled risks are coming to the lodging sector, according to analysts at Bernstein.

Late last month, a report from airline analytics firm OAG found that flight bookings from Canada to the U.S. were down by 70% in March.

Flight passengers from Mexico fell by 11% in February as well, while incoming travellers from France decreased by 6%.

Despite being traditionally close trading partners, Canada and Mexico have been the hit with tariffs by Trump, who has said the action also aims to curb the flow of illegal drugs and migration into the U.S.

The European Union has also been the object of Trump’s trade-related ire, with the bloc saying it "will continue to seek negotiated solutions, while safeguarding its economic interests."

In a note to clients, the analysts led by Richard Clarke argued that, although the figure "likely overestimates the impact [of] official February data showing Canada travel down 20%," it does "reflect a real weakness in demand following imposition of heavy tariffs."

U.S. President Donald Trump has made levies a centerpiece of his second term in the White House, saying that the moves are necessary to correct international trade imbalances, boost government revenues, and bring manufacturing jobs back to the country.

Some economists have warned that the duties will refuel inflationary pressures and weigh on growth, leading to a period of so-called "stagflation" in the U.S. economy.

On Wednesday, Trump unveiled the latest batch of tariffs on both friends and adversaries alike, sparking a host of threats of retaliatory duties.

Visitors to the U.S. may decide against travel to the U.S. in response to the tariffs, the Bernstein analysts flagged.

"This is a negative to the U.S.," they added. "Inbound travel is 13% of the U.S. market and although the U.S. spends more than it receives, there is little sign of a slowdown in U.S. outbound travel, still up 3-4% year-to-date, suggesting Americans are not similarly voting with their feet."

Other markets stand to benefit from the turn away from U.S. travel as tourists consider alternative destinations like Canada and Mexico, the analysts said. Still, risks to the lodging industry remain from fading consumer confidence and a backlash against U.S. brands, they said.

Hotel group Marriott (NASDAQ: MAR ) has a sizeable presence in Canada, while rival Hyatt (NYSE: H ) has the biggest exposure to the Mexico and Caribbean regions, they noted. The brokerage has given both groups have an "outperform" rating.