McDonald’s working on $5 value meal

McDonald's is working to introduce a $5 value meal as lower-income consumers pull back on spending at fast food chains.

McDonald’s is working to introduce a value meal in U.S. stores to help offset an increasingly challenging environment for consumers, two people familiar with the matter told CNBC.

The people said the $5 meal could include four items: a McChicken or McDouble, four-piece chicken nuggets, fries and a drink. The value meal was first reported by Bloomberg News.

The potential new offering comes at a time when low-income consumers are beginning to pull back on spending, particularly at fast-food brands. Mentions of low-income consumers on company earnings calls are at their highest levels in nearly two years, according to data from Bank of America. Executives from McDonald’s to Wendy’s to Dave and Buster’s have all noted the restraint in spending. 

McDonald’s recently reported a mixed first quarter, with U.S. same-store sales slightly missing expectations. Higher prices helped grow average checks, but some consumers pulled back as a result of the steeper costs.

“Consumers continue to be even more discriminating with every dollar that they spend as they faced elevated prices in their day-to-day spending, which is putting pressure on the [quick-service restaurant] industry,” CEO Chris Kempczinski said on the company’s earnings call on April 30.

https://www.nbcnews.com/business/consumer/mcdonalds-working-5-value-meal-rcna151728

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