McDonald's has deployed AI in the US that estimates how much a customer in a given restaurant is willing to pay, and recommends menu prices accordingly.

Reuters described a case from Fresno: a Big Mac for $5.69 at one location and $6.89 at another, two kilometers apart. The difference is 21% for the exact same menu.

The company says franchisees set final prices themselves. But it also monitors whether recommendations are followed and sends updated pricing guidance several times a year. A recommendation that someone checks is no longer just a recommendation.

In my opinion, dynamic pricing is moving from airline tickets and Uber to things you buy every week. The algorithm doesn't look for a "fair" price; it looks for your maximum price limit.

For McDonald's, it's pure margin defense at a time when consumers have empty wallets and no longer want to pay $15 for a meal. Instead of across-the-board price increases, it takes exactly as much as each location can bear.

Be prepared that this won't stop at fast food.