This Monday, Feb. 8, 2016, photo, shows the sign of a Chipotle restaurant in Hialeah, Fla. Chipotle is using free burrito offers to combat the “eerie” look of empty stores and convince people it’s safe to return. The offers come as Chipotle fights to recover from a series of food scares, with sales down 26 percent in February. () (AP Photo/Alan Diaz)

Struggling Chipotle still can't get that E. coli out of its system

Once a juggernaut, the fast food chain has been unable to recover after two separate E. Coli outbreaks in 2015


Matthew Rozsa
October 27, 2016 12:44AM (UTC)

Chipotle continues to struggle in the wake of an E. coli scare last year.

The Mexican restaurant chain reported on Tuesday that sales had fallen 21.9 percent at established restaurants during the third quarter. This is worse than the 18.3 percent drop that Wall Street analysts anticipated and the fourth consecutive quarter in which sales have declined. Chipotle says that its profit plummeted 95 percent in the quarter, despite efforts to lure back customers with free burritos, a loyalty program, and food safety ads.

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Chipotle’s CEOs tried to put a happy face on the bad news. “We continued to make steady progress in our sales recovery during the third quarter,” said co-CEO Steve Ells in a press release. “We are earning back our customers’ trust, and our research demonstrates that people are feeling better about our brand, and the quality of our food.”

Co-CEO Monty Moran expressed similar thoughts. “After successfully implementing an industry leading food-safety program, and as our marketing efforts are driving more people to our restaurants, it is critical that we are prepared to delight customers on every visit,” he said in the release. “We are confident that we have the leadership and teams in place to do just that.”  

As Chipotle’s standing as one of America’s top fast food chains has fallen, other brands have picked up the slack. Chipotle’s primary competitor in fast casual food, Panera, has outperformed Chipotle’s stock ever since the E. coli outbreak occurred. Panera has emphasized serving “clean” food during this time period, which has helped its brand. In a similar vein, shares for hamburger chain Jack in the Box and Tex-Mex chain Moe’s Southwestern Grill have also risen in value since the E. coli outbreak tarnished Chipotle’s brand.

Chipotle’s ills began in October 2015, when two separate E. coli outbreaks were traced to restaurants in Washington and Oregon. After 43 restaurants were closed in those states, the FDA launched an investigation. As of January 27, 2016, the CDC reported that 55 people had been infected with STEC (Shiga toxin producing E. coli) from 11 states.


Matthew Rozsa

Matthew Rozsa is a breaking news writer for Salon. He holds an MA in History from Rutgers University-Newark and is ABD in his PhD program in History at Lehigh University. His work has appeared in Mic, Quartz and MSNBC.

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