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KFC to launch plant-based fried chicken made with Beyond Meat

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KFC restaurants in the United States will add Beyond Meat’s plant-based chicken to its menus, starting Monday for a limited time.

The launch comes after years of testing from the Yum Brands chain and Beyond Meat to create a meat substitute that mimicked the taste and texture of whole muscle chicken, like chicken breast.

The two companies first tested plant-based chicken at an Atlanta restaurant in August 2019 — and sold out their limited supply in less than five hours. KFC then tested the new item in Nashville, Charlotte, N.C., and southern California two years ago.

The popular fried chicken chain is counting on customers making healthier choices to fulfill typical New Year’s resolutions. “This is really about where the customer is going; they want to eat more plant-based proteins,” said Kevin Hochman, U.S. president of KFC. “It’s January, so it’s a time of New Year’s resolutions and wanting to do something different in your diet.”

More Americans are embracing a so-called flexitarian diet in which consumers cut down on their meat consumption for health and environmental reasons. That has driven the growing popularity of plant-based substitutes.

“From a supply perspective, we feel really good about it, and it’s something we have experience with in initial trials,” said Beyond Meat CEO Ethan Brown.

Hochman and Brown are so bullish on the product that they’re not deterred by the current nationwide surge in the Covid omicron variant.

The partnership hits at the time of national labor, with many eateries running short staffed. To run smoothly even with fewer workers, some chains have been reluctant to add new items or even scaled back their menus. Surges in new Covid-19 cases exacerbate those issues as workers call in sick due to positive tests or exposure to infection.

Nearly a year ago, Beyond Meat announced a formal partnership with Yum to make exclusive plant-based substitutes for Pizza Hut, Taco Bell and KFC. Chipotle Mexican Grill rolled out plant-based chorizo Monday at its restaurants nationwide. It also is targeting customers who are trying to eat less meat in 2022.

Ramping up for launches
In preparing for launches to come in the new year, Beyond Meat poached industry veterans from Tyson Foods for its C-suite in December, adding Doug Ramsey as chief operating officer and Bernie Adcock in a new role of chief supply chain officer.

Ramsey spent three decades at Tyson, overseeing its poultry and McDonald’s businesses. Adcock also spent 30 years at Tyson with a focus on operations and supply chain management.

“We’re continuing to grow the operations team; they did a lot of work to help the team get ready in these final days,” Brown said, adding the Yum tie-up has been years in the making. “They’ve helped us prepare for this and we brought in, I think, some of the top executives in the industry.”

Beyond Meat is looking to get its stock back on track. In the last 12 months, shares have lost half their value, dragging the company’s market value down to $3.9 billion. The stock closed Tuesday down 5% at $61.62 and short sellers betting against the stock represent 37.2% of available shares, according to Factset.

On the other hand, shares of Yum have climbed 30% in the last year, bringing its market value to $40.3 billion. Strong demand for KFC’s fried chicken has helped lift the price. The chain’s U.S. same-store sales jumped 13% on a two-year basis during its third quarter.

Synergies with retail
The partnership does provide an opportunity, however, for “Beyond” restaurant sales. The company is hoping to attract more customers to its grocery store products, which sold briskly early in the pandemic, but then saw declines in subsequent quarters.

“It has great synergies with what we are trying to do in retail,” Brown said.

To promote the new menu item, YouTube star Liza Koshy will star in the plant-based chicken’s ad campaign, in the latest partnership between fast food chains and influencers. However, KFC will not be targeting vegans and vegetarians directly with its marketing because the Beyond Fried Chicken is made using the same equipment as KFC’s traditional fried chicken.

Customers can buy KFC’s Beyond Fried Chicken in six- or 12-piece orders, with dipping sauce included. Prices start at $6.99, excluding tax.

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Airbus cancels $6bn contract with Qatar Airways after paint fight

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Airbus has cancelled a $6bn contract with Qatar Airways for 50 of its new A321neo passenger jets, escalating a legal battle between the two companies over paint on the recently delivered A350s.

Qatar Airways called Airbus’s decision announced on Friday “a matter of considerable regret and frustration”.

In December, Airbus was taken to court by Qatar Airways in London, following a series of alleged problems with the Airbus A350 aircraft.

The airline complained the paint on the recently delivered Airbus A350s was cracking and peeling, exposing copper meshing used to insulate the aircraft against lightning strike.

It is seeking more than $600m in compensation after grounding the affected aircraft – 21 of its 53 A350 jets – claiming the paint issue is a safety risk.

The deal was reportedly worth $6.35bn when it was finalised in December 2017.

Qatar Airways published a video on social media on Friday of the scarred exterior of grounded A350 jets that the airline said underscored “serious and legitimate safety concerns”.

The European Union Aviation Safety Agency independently assessed the issue and found no safety concerns.

“There is no reasonable or rational basis” for Qatari regulators to have grounded the A350s operated by Qatar Airways, Airbus said in documents prepared for a London court hearing on Thursday.

It accused Qatar Airways of instigating the grounding as it was in its own financial interest to keep the aircraft on the ground in light of the coronavirus pandemic collapse in demand for air travel.

Qatar Airways rejected the claims in a statement on Friday.

“These defects are not superficial and one of the defects causes the aircraft’s lightning protection system to be exposed and damaged,” it said. “We continue to urge Airbus to undertake a satisfactory root cause analysis into the cause of the defects.”

An investigation by Reuters news agency showed at least five other airlines reported A350 paint or skin flaws since 2016, well before Qatar raised concerns in November 2020 when an attempt to repaint a jet in World Cup livery exposed some 980 defects.

Airbus has said it is looking at changing the design of anti-lightning mesh for future A350s, but insisted there is adequate backup lightning protection. It says Qatar is undermining global protocols by seeking leverage over safety.

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Wall Street caps worst week since start of coronavirus pandemic

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Stocks fell, capping the worst week since the outbreak of the pandemic roiled markets, with tech shares bearing the brunt of the selloff amid shaky company earnings and prospects for higher U.S. interest rates.

The S&P 500 closed below its 200-day moving average, a key technical level, for the first time since 2020. The tech-heavy Nasdaq 100 slid the most among major benchmarks Friday, led by a more than 20% plunge in shares of streaming giant Netflix Inc. Bitcoin tumbled in an extended selloff for cryptocurrencies, briefly falling below $38,000 to its lowest level in more than five months.

Volatility that has gripped markets this month showed little sign of letting up Friday, with the S&P 500 falling for a fourth day, extending losses in the period to 5.7% for the worst, albeit shortened, week since March 2020. Option expirations of more than $3 trillion helped add to market turbulence.

“This is the longest short week, I think, in history, right?” Jay Pelosky, founder and president of TPW Investment Management, said on Bloomberg TV. “It’s only been a four-day week and it feels like it’s been two weeks rolled into one.”

The U.S. company reporting season so far has been uneven, highlighting the risk that it may fail to enliven animal spirits in the stock market. While Netflix’s disappointing subscriber outlook sent its shares tumbling, while Peloton Interactive Inc. suggested it was poised to rebound after the darling of the stay-at-home trade was hit by a report of temporary production halts.

Markets are also bracing for rate liftoff by the Federal Reserve. Economists surveyed by Bloomberg expect policy makers to raise interest rates in March for the first time in more than three years and shrink their balance sheet soon after. Geopolitical tensions are also adding to the jitters. A report that Washington is allowing some Baltic states to send U.S.-made weapons to Ukraine stoked concerns about a standoff with Russia.

“There are plenty of risks in the global economy, including geo-political events,” wrote Ethan Harris, head of global economics at Bank of America Global Research. “However, in our view, the biggest near-term risk is right in front of us: that the Fed is seriously behind the curve and has to get serious about fighting inflation.”

Demand for havens pushed the 10-year Treasury yield down more than 10 basis points in three days to 1.76%, leaving the rate lower on the week, the first decline for the period in five weeks.

The selloff in equity markets has volatility indexes pricing more turbulence near term than in the future. The setup, known as an inverted VIX. Such an inverted curve has occurred four other times in the past year and all coincided with market bottoms.

“We’re all going to breathe an extra sigh of relief once this session finally closes and then we can put an end to this week, because it’s been painful all around,” said Adam Phillips, managing director of Portfolio Strategy at EP Wealth Advisors in Torrance, California.

Some of the main moves in markets:

Stocks

  • The S&P 500 fell 1.9% as of 4 p.m. New York time
  • The Nasdaq 100 fell 2.7%
  • The Dow Jones Industrial Average fell 1.3%
  • The MSCI World index fell 1.8%

Currencies

  • The Bloomberg Dollar Spot Index fell 0.1%
  • The euro rose 0.3% to $1.1345
  • The British pound fell 0.3% to $1.3557
  • The Japanese yen rose 0.4% to 113.68 per dollar

Bonds

  • The yield on 10-year Treasuries declined five basis points to 1.76%
  • Germany’s 10-year yield declined four basis points to -0.06%
  • Britain’s 10-year yield declined five basis points to 1.17%

Commodities

  • West Texas Intermediate crude fell 0.7% to $84.91 a barrel
  • Gold futures fell 0.7% to $1,832.70 an ounce

SOURCE: BLOOMBERG

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Bitcoin falls another 8% as cryptocurrencies extend steep losses

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Cryptocurrencies continued their dramatic slide on Saturday, with bitcoin losing nearly half of its value since hitting its November high.

Bitcoin, the world’s most valuable cryptocurrency by market value, tumbled about 8% on Saturday to trade just above $35,000. The coin hit a record high of $69,000 in November.

Meantime, ether, the second-largest cryptocurrency by market cap, sank nearly 10% to trade around $2,400.

The losses came on the heels of a Thursday dip in the stock market. Cryptocurrencies and traditional stocks have been falling in tandem this month, with investors concerned about how anticipated Federal Reserve interest-rate increases will affect the market.

A common investment case for bitcoin is that it serves as a hedge against rising inflation as a result of government stimulus, but analysts are saying the risk is that a more hawkish Fed may take the wind out of the crypto market’s sails.

There’s also concern U.S. regulators will further crack down on digital currencies.

Russia’s central bank proposed banning the use and mining of cryptocurrencies earlier in the week. Officials argued it posed threats to financial stability, citizens’ wellbeing and its monetary policy sovereignty. U.S. authorities have also been clamping down on certain aspects of the market.

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