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McDonald's Will Hold the Heat Lamps

March 27, 1998| From Associated Press

After years of gimmicky flops, McDonald's has decided its biggest problem is that some customers just don't like warmed-over burgers.

The fast-food chain plans to install computerized and partially robotic kitchens in all its U.S. outlets by the end of next year. The machines can deliver fresher, made-to-order Big Macs, Quarter Pounders and new items that would slow down the old kitchens too much. Heat lamps will no longer be used.

Some McDonald's franchises now cook burgers earlier in the day and reheat them as needed. A request for a couple of extra pickles or a burger without sauce can mean the customer waits 15 minutes more.

The new kitchens are designed to "remember" when the lunch rush starts at a given restaurant and whether Quarter Pounders with cheese have been particularly popular lately. The computer will alert the staff to start making burgers just before the rush. A computer-monitored machine will handle the cooking of French fries, and robot machines will prepare drinks.

McDonald's said the system will result in a charge of up to $190 million for the second quarter, more than the $150 million it estimated when it presented the system to franchisees last week.

The company said the new process will save each restaurant an average of $15,000 a year. It said it has agreed to provide up to half the estimated $25,000-per-franchise cost of buying and installing the equipment.

In another cost-saving move, McDonald's said, it is undertaking a review of operations at its headquarters in Oak Brook, Ill. Some job losses among the 2,700 employees there are likely, Chief Financial Officer Michael Conley said.

McDonald's has tried McLean Deluxe, Arch Deluxe, last year's Campaign 55 and even pizza to bring in new customers, largely without success. Through all the attempts at new menu offerings, complaints about the quality of the food persisted.

McDonald's shares rose $2.38 to close at $55.38 on the New York Stock Exchange.

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