By Arlenys Tabare
For this Monday, May 11, The average price of gasoline in the United States was $4.52 per gallon, This is as a result of the development of the war in Iran, which has caused the majority of American households to reduce their discretionary spending to allocate their income only to covering basic needs.
Since inflation increased to historic levels in July 2022, Americans have been struggling with high prices for food, goods and servicescausing many of their leisure expenses to decrease. This caused sales in stores, restaurants and retail chains to decrease at that time.
Now, with fuel getting closer and closer to $5 per gallon, a survey conducted by Numerator revealed that nearly 43% of drivers surveyed said they reduced their spending at restaurants or fast food chains, and according to Shadowy Box Intelligence datain the last quarter Food traffic fell 2.3% in March compared to last year.
To date, several restaurant CEOs have spoken out on the matter, pointing out that the increase in gasoline is undoubtedly affecting sales in their establishments, which poses a risk for many of these companies that have been carrying large debts since the pandemic.
Recently, McDonald’s CEO Chris Kempczinski commented that “When there are high gas prices or inflation, it disproportionately affects low-income consumers,” he said while noting that he expects the pressures to continue.
For his part, the CEO of Brinker Global, owner of Chili’s, noted that since geopolitical events began and, as a consequence, the increase in gasoline, its customers were leaning towards cheaper options, buying less alcohol and skipping dessert.
John Peyton, CEO of Dine Brands, parent company of Applebee’s and IHOP also stated that “March and April were the weakest months compared to January and February, especially among consumers looking to savewho stayed home more or ate at cheaper restaurants, and we attribute this to gas prices in particular and the current economy,” he told CNBC.
Keep reading:
- Economists from the Monetary Institution of The US assure that the FED will not cut interest rates until the second half of 2027
- US consumer confidence hits record lows as war in Iran drags on
- Rising gasoline prices put more pressure on low-income Americans, report highlights
- Circle Okay will offer discounts on gasoline throughout the summer in celebration of 250 years of the United States.
