McDonald's launches $5 menu offer as inflation-stricken consumers shun fast food

McDonald's plans to introduce a $5 meal deal to lure customers back into stores amid the inflation-related cost-of-living crisis.

The fast-food giant’s global sales have slowed in the past year, according to Bloomberg.

The meal could include a McChicken or a McDouble, along with fries and a drink, a source said. BloombergThe Coca-Cola Company has also offered to provide financing to complete the deal.

More Americans are choosing to eat at home as high inflation directly affects fast food prices. A regular McDonald's Quarter Pounder with cheese now costs an estimated $11.99, according to the personal finance website, up from $5.39 ten years ago. FinanceBuzz.

McDonald's CEO Chris Kempczinski said in a recent conference call to announce quarterly results that the company needs to “clearly focus on affordability.”

“I think it's important to recognize that all income groups are looking for value,” Kempczinski said. “What we don't have in the U.S. right now is a national value platform.”

McDonald's shares rose 2.7 percent on Friday following news of the $5 menu offer, the highest daily increase since January 2023. Shares of competitors Wendy's and Burger King, however, fell.

However, the company is likely to have considerable difficulty convincing US franchisees to introduce the offer. Earlier this year, 95 percent of franchisees rejected the $5 menu offer for fear of further revenue losses.

This was particularly a problem for McDonald's stores in California, where a new law requires fast-food workers to earn at least $20 an hour.

After this law went into effect in April, fast-food restaurants across the state raised their prices.

The Independent has asked McDonald's for comment on reports about the $5 meal deal.