Coming price cuts at McDonald’s may signal a fast food price war
McDonald’s is cutting prices on some combo meals to woo back customers who’ve been turned off by the rising costs of grabbing a fast food meal.
The price drop may induce its rivals, who have run into some of the same pricing issues, to follow.
Starting Monday, McDonald’s will offer Extra Value Meals, which combine select entrees like a Big Mac, an Egg McMuffin or a McCrispy sandwich with medium fries or hash browns and a drink. Prices will vary by location, but McDonald’s said Extra Value Meals will cost 15% less than ordering each of those items separately.
To kick off the promotion, McDonald’s will offer an $8 Big Mac meal or a $5 Sausage McMuffin meal for a limited time in most of the country. Customers in California, Alaska, Hawaii and Guam will have to pay $1 more for those meals.
McDonald’s for years has seen a steady decline in visits from customers in the U.S. who have household incomes of less than $45,000 per year. CEO Chris Kempczinski said those consumers, and others, no longer see McDonald’s as a good value.
At a McDonald’s near the company’s Chicago headquarters, for example, a 10-piece Chicken McNugget meal costs $10.39.
Higher prices have been a drag on sales. McDonald’s same-store sales — or sales at stores open at least a year — grew 2.5% in the April-June period, but that was mostly because of higher prices. Fast food visits by lower-income consumers dropped by double-digit percentages industrywide in the second quarter, McDonald’s said.
McDonald’s job has been made harder by prices that can vary widely around the country. In May 2024, after a post on X about a Big Mac meal in Connecticut that cost $18 went viral, McDonald’s called it an “exception” and noted that franchisees set prices for nearly all U.S. restaurants.
The company also blames higher costs. The average price of its menu items rose 40% between 2019 and 2024, McDonald’s said, to account for a 40% increase in the cost of labor, packaging and food.
Other chains are also seeking to grab the attention of potential customers. In late August, Domino’s launched its Best Deal Ever promotion, offering any pizza with any toppings for $9.99.