NORFOLK, Va. — McDonald's is facing a class action lawsuit over allegations that the fast food chain uses artificial intelligence to generate menu prices for its franchisees.
The lawsuit, brought by a McDonald's customer in Chicago, claims the company's pricing model has led to inconsistent prices across locations.
"Fast food was cheap fast food. That was the big sale. Well, with this new dynamic pricing model that, for example, McDonald's is using, that's not the case," said Peter Shaw, Retired Professor Emeritus of Business Administration at TCC.
Shaw pointed to a specific example cited in the case.
"They found in one case in Fresno, California, where a guy went in to get a Big Mac at one McDonald's restaurant, drove two miles down the road, that same Big Mac was 21% higher," Shaw said.
McDonald's, however, maintains that its franchisees have the final say in pricing decisions.
For families already dealing with tight budgets, Shaw said the impact has been significant.
"If they're going to go to fast food, are all the fast food prices the same? Check the prices. You can go online to do it. Or, you know, they might just say, you know what, I'm going to go to the grocery store and buy the same stuff, fix it, and that's that," Shaw said.
McDonald's has denied using AI for menu pricing. At the beginning of October, the company published a fact-check sheet on its website addressing the allegations.
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