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Spooked McDonald's boss reveals huge amount prices have risen since 2019 in open letter about viral $18 Big Mac
McDonald's has written an unprecedented open letter to customers claiming its price rises aren't as bad as some media is reporting.
But in the letter, president Joe Erlinger says prices have 'only' gone up 40 percent across its 14,000 US restaurants since before the pandemic.
The letter was aimed to calm the furore around the soaring cost of fast food - which is now so high that four in five Americans consider it a luxury.
'Recently, we have seen viral social posts and poorly sourced reports that McDonald’s has raised prices significantly beyond inflationary rates. This is inaccurate,' he wrote.
But in the very same letter he includes the statistic: 'The average price of McDonald's menu items is up [around]40 per cent ove the past five years.'
In that time the overall rate of inflation in the US is 22 per cent, according to the US Bureau of Labor Statistics, and even for food the rate is barely hgher at 26 per cent.
McDonald's president Joe Erlinger admits in an open letter that prices are up across the menu by 40 percent in five years
A Big Mac meal can cost as much as $17.59, which after tax is close to $20
Expert Neil Saunders, from GlobalData, told DailyMail.com: 'The letter is a bid to reassure customers that McDonald’s is not profiteering or acting unfairly.
'The problem is that while people may well buy that, the reality is that the price of menu items has become a lot more expensive.
'That may not be McDonald’s fault but it’s a problem for a meal that’s supposed to be an inexpensive indulgence.'
McDonald's made an eye-watering $14.5 billion profit last year.
In a 'myths vs facts' section of the letter, Erlinger says it is a myth that 'McDonald's has raised prices at a rate nearly double the rate of inflation'.
To back this up, he ignores the offical rate of inflation. Instead, he points to how much more McDonald's is paying for things.
He says: 'The average input costs (salaries, food and paper) are up around 40 per cent over the past five years. The average price of McDonald's menu items is up around 40 per cent over the past five years.'
He also admitted that the average price of a 10-piece McNuggets Meal now tpically costs 28 per cent more, up from $7.19 to $9.19.
Meanwhile he said a Big Mac was up 21 per cent, a Quarter Pounder with Cheese up 20 per cent and an Egg McMuffin up 23 per cent.
Erlinger admits that $18 Big Mac meals worry him - but says that they are the exception rather than the rule.
'I can tell you that 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.;
But then he rails aganst customers on social media talking about it.
He added: '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.'
His letter comes as a new report out Monday showed how much some popular combo meals have shot up in price.
Official figures show that annual inflation for the fast food sector is 4.8 per cent, but that tells only part of the story after years of rises, a report by USA Today shows.
Prices for a typical combo meal at the five biggest burger chains - McDonald's, Burger King, Wendy's, Carls Jr and Five Guys - have risen as much as 120 per cent in a decade.
That is more than three times the official rate of inflation - the cost of goods has risen just 31 percent since 2014, according to the US Bureau of Labor Statistics.
There is no doubt Americans have been voting with their wallets.
In the first three months of 2024, visitors to fast food chains slumped by 3.5 percent on a year ago, according to data from Revenue Management Solutions.
What McDonald's says about price rises
How prices for meals at the biggest five fast food restaurants have gone up in price in a decade
In real terms, that is millions of Americans a week skipping the drive-thru - with chains themselves admitting higher prices have put off burger fans.
At Carl’s Jr, a Famous Star combo has jumped from $5.29 to $11.68 - a more than doubling since 2014.
McDonald's plans a $5 meal bundle from June 25. Customers will get a total of four items - either a McDouble or McChicken sandwich, small fries, small soft drink and four McNuggets.
Burger King has a similar $5 deal, while Wendy's has launched a $3 breakfast meal - as a fast food price war looks to be heating up.