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McDonald’s: Our prices haven’t risen as much as you think

<i>Victor J. Blue/Bloomberg/Getty Images via CNN Newsource</i><br/>A McDonald's location in New York
Victor J. Blue/Bloomberg/Getty Images via CNN Newsource
A McDonald's location in New York

By Danielle Wiener-Bronner, CNN

New York (CNN) — McDonald’s has a message for America: Rumors of Big Mac inflation are greatly exaggerated.

“Recently, we have seen viral social posts and poorly sourced reports that McDonald’s has raised prices significantly beyond inflationary rates. This is inaccurate,” Joe Erlinger, president of McDonald’s USA, wrote in an open letter posted to the company’s website on Wednesday.

“The average price of a Big Mac in the U.S. was $4.39 in 2019,” he said. “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%).”

What Erlinger wants customers to know is not that high-priced McDonald’s burgers don’t exist at all. He just wants them to know that the burgers that have been cited as proof of radically higher prices are not the norm.

“It frustrates and worries me, and many of our franchisees, when I hear about an $18 Big Mac meal being sold — even if it was at one location in the U.S. out of more than 13,700,” he said. “More worrying, though, is when people believe that this is the rule and not the exception, or when folks start to suggest that the prices of a Big Mac have risen 100% since 2019.”

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.

Erlinger is fighting back because McDonald’s pricey burgers have become something of a symbol of elevated fast food prices. And being seen as overpriced could hamper sales and reputation, especially at McDonald’s.

“It’s imperative that we continue to keep affordability at the forefront for our customers,” McDonald’s CEO Chris Kempczinski said during an April 30 analyst call. “We literally wrote the playbook on value, and we are committed to upholding our leadership within the industry.”

To win back consumers, the burger chain is also reportedly considering adding a $5 value meal to the menu for a limited time.

Earlier this month, the Wall Street Journal reported that McDonald’s is planning to start running its $5 meal promotion at the end of June.

A recent statement from the National Owner’s Association, a group for McDonald’s franchise operators, indicated that operators were still deciding whether to adopt the promotion, which would include chicken nuggets, fries, a soft drink and either a McDouble or McChicken sandwich for $5. A NOA representative declined to comment on the status of the vote.

Erlinger nodded to the possibility of a national $5 value meal in his letter.

“I fully expect the prices at your local McDonald’s to be an area of conversation and focus in the coming months,” he said. “As it does, I hope you’ll see the programs we’re launching nationally and locally as meaningful to you.”

— CNN’s Jordan Valinsky contributed to this report.

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Article Topic Follows: CNN - Business/Consumer

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