South Dakota tourism officials are optimistic that high gas prices could actually benefit the state's travel industry, as more Americans opt for regional road trips over expensive flights. The Foley family from Green Bay, Wisconsin, exemplifies this trend, driving 12 hours to the Black Hills for a weeklong vacation in late April, undeterred by rising fuel costs.
Silver Lining in High Gas Prices
Jim Hagen, South Dakota's tourism secretary, noted that the state has historically outperformed others when gas prices are high. National surveys indicate that 90% of Americans plan to travel this summer despite higher costs, with many choosing to drive rather than fly. "They want to travel regionally, and they're opting for that over more expensive, long-haul air travel trips," Hagen said. "South Dakota is seen as a regional-drive market, and we are the ultimate road trip destination."
The Foley family, who usually fly to beach destinations, chose to drive this year due to their aging dog. Ryan Foley, a real estate firm owner, said, "It's our family trip, so paying a little more for gas is no big deal." They visited Wind Cave National Park, Mount Rushmore, and Custer State Park, finding good value in local accommodations and dining.
250th Anniversary as a Tourism Driver
The nation's 250th anniversary of the Declaration of Independence is expected to boost tourism. Hagen sees strong potential, with surveys showing interest in American history and a 18% increase in national park visitation. Rapid City's "Real America Birthday Bash" on July 1-4 will feature the U.S. Air Force Academy band, drone shows, a parade, and fireworks. Mount Rushmore's July 3 fireworks show is also planned, with Governor Larry Rhoden inviting President Trump.
Keystone store owner Bria Dillavou noted increased patriotic merchandise nationwide. "Our experience has been that people are still taking family trips, especially if they can drive," she said.
Major Events Across the State
The Black Hills region expects a strong season with the 86th Sturgis Motorcycle Rally (Aug. 7-16) and the 250th celebrations. Sioux Falls is attracting shoppers and foodies with events like Rock the Country Music Festival and the Airshow. Hunting, fishing, and camping remain draws in eastern South Dakota.
Travel South Dakota spent about $13 million on advertising, targeting neighboring states and Chicago. Canadian visits remain down due to trade tensions. In 2025, the state saw 15 million visitors spending $5.2 billion, a 1.1% revenue increase over 2024.
Economic Impact of Tourism
Tourism generated 4.7% of South Dakota's economy and 16.5% of state sales tax collections ($406 million) in 2025, supporting over 59,000 jobs. Without tourism, each household would have paid $1,121 more in taxes.
Hagen said economic concerns caused trepidation last year, but this year, "people are like, 'We've had it. Let's get out, let's go have fun, even if they'll be looking for good value.'"
Concerns and Optimism
Teri Schmidt, CEO of Experience Sioux Falls, expressed concern over gas prices and the soft economy. "If gas goes to $5 a gallon, we don't know how people will respond," she said. Tightening budgets could shorten visits or reduce spending. However, website visits are up, and marketing efforts have expanded nationally.
Michelle Thomson, CEO of the Black Hills & Badlands Tourism Association, noted that higher costs could drive more travel in spring and fall shoulder seasons. Travelers are waiting longer to book, but research shows they are willing to pay more for experiences. "With the 250th, we have the potential to bring in people from across the country because of our patriotic experience," she said.
This story was originally published by South Dakota News Watch and distributed through a partnership with The Associated Press.
