McDonald’s releases a new $5 value meal to combat inflation
Jun 20, 2024, 6:56 AM
FILE: A sign is posted in front of a McDonald's restaurant on February 06, 2024 in San Leandro, California. McDonald's reported fourth quarter earnings on Monday that beat analyst earnings estimates but fell short on revenue as its Middle Eastern sales slumped due to the Israel-Hamas conflict. The fast food chain reported net income for the fourth quarter of $2.04 billion, or $2.80 per share, compared to $1.9 billion, or $2.59 per share, one year ago. (Photo by Justin Sullivan/Getty Images)
(Photo by Justin Sullivan/Getty Images)
NEW YORK (CNN) — McDonald’s has revealed the details of its highly anticipated $5 value meal, which the fast food chain hopes will rev up sluggish sales and lure back customers who have cut back.
Beginning June 25, McDonald’s U.S. locations are selling a “$5 Meal Deal” for a limited time. It includes a McDouble cheeseburger or a McChicken sandwich, small french fries, 4-piece chicken nuggets and small soft drink.
“We heard our fans loud and clear — they’re looking for even more great value from us, and this summer that’s exactly what they’ll get,” said Joe Erlinger, president of McDonald’s USA, in a press release.
Word of McDonald’s newest value meal was released last month in the Wall Street Journal, prompting fast food rivals to get a jumpstart on offering similar deals and attract cost-conscious eaters. Burger King, Wendy’s and even Starbucks have rolled out meal deals in recent weeks.
The arrival of the McDonald’s meal deal comes at a time when the company is battling the perception that it has become too expensive. That caused Erlinger to put out a rare open letter denouncing “viral social posts and poorly sourced reports that McDonald’s has raised prices significantly beyond inflationary rates.”
“The average price of a Big Mac in the U.S. was $4.39 in 2019,” he wrote. “Despite a global pandemic and historic rises in supply chain costs, wages and other inflationary pressures in the years that followed, the average cost is now $5.29. That’s an increase of 21% (not 100%).”
Online, people have been airing their fast food price grievances. But they’re not just griping: Customers are pulling back on spending, too. Diners, frustrated by higher prices, are not going out to eat as often and spending less when they do, causing fast food sales to slow and traffic to dip.
In Thursday’s release, McDonald’s pointed out that franchisees are also offering deals like a “buy one, get one” deal for $1 breakfast sandwiches in Memphis and a double cheeseburger and small fries pairing for $3.50 in Columbus, Ohio.
“Affordable prices and creating memorable moments are what McDonald’s is all about,” said John Palmaccio, a McDonald’s owner and chair of the Operator’s National Advertising Fund. “As small business owners, it’s our responsibility to deliver great value to our local communities when they need it most.”
McDonald’s is expected to release its next earnings report in late July.
