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McDonald's cuts prices by nearly 33%

UNITED States fast food chain McDonald's yesterday offered its biggest price discounts in China as it tries to cope with a weak catering industry hit by the slowing economy.

From yesterday till March 10, customers can buy four super value combo meals at McDonald's 1,065 stores across the nation for 16.50 yuan (US$2.41), a discount 32.6 percent, and at a price lower than 10 years ago. The fast food chain has also launched new varieties such as a pork burger for 6 yuan while its breakfast menu combo costs 10 yuan and will be offered on a long-term basis, McDonald's said.

McDonald's said the nationwide super value discount campaign, which covers nearly 40 percent of its total products, has been its most aggressive price reductions since its entry to the country in 1998 and comes on the heels of a weak market confidence.

"It's our goal to make sure McDonald's is affordable and accessible to more and more consumers," said Jeffrey Schwarts, chief executive officer of McDonald's China.

Over the last few months of last year, the impact of the global financial crisis has been spreading to China's catering industry which has seen a drop in outdoor dining and consumption in many high-end restaurants.

KFC, the biggest fast food chain in China with double the number of stores that McDoanld's has, has also offered discounts of up to 20 percent in its meal sets since November.

McDonald's estimated that the super value discount campaign would help its sales revenue in China this year grow 5 percent, said Phyllis Cheung, vice president and chief marketing officer of McDonald's China.

Schwarts disclosed 175 new restaurants will be open in China this year, which will create 10,000 jobs. This would make China its No. 1 growth market for the first time.

McDonald's also plans to expand domestic sourcing to supply its global markets in the future. Its domestic purchases to supply its markets in China have risen by four times over the past 10 years.


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