A major chip supplier is cutting jobs as customers continue to count their pennies amid high prices at fast food chains.

Lamb Weston, the largest maker of French fries in North America, announced last week that it would close its plant in Connell, Washington, meaning it would lay off 375 employees, or 4% of its workforce, according to an earnings report last year. week was released. .

“Restaurant traffic and demand for frozen potatoes remain weak relative to supply, and we believe this will remain weak for the remainder of fiscal 2025,” Tom Werner, president and CEO of Lamb Weston, said during an earnings call last week .

MCDONALD’S DAYS AWAY FROM BRINGING MINIATURE VERSIONS OF POPULAR SHOES TO US HAPPY MEALS

The fries from Wendy’s Co. are pictured at a restaurant location in Mount Vernon, Illinois, USA on Wednesday, July 29, 2015. Wendy’s Co.’s quarterly results are expected to be announced on August 5. (Luke Sharrett/Bloomberg via Getty Images/Getty Images)

“Together, we expect these actions will help us better manage our plant utilization rates and alleviate some of the current supply-demand imbalance in North America,” he added. “We are also taking actions to reduce operating costs, including reducing headcount and eliminating certain unfilled positions, as well as reducing capital expenditures. The combined estimated savings from these actions are reflected in our updated fiscal year 2025 targets. “

The Eagle, Idaho-based company told Fox Business that the restructuring will not impact customer deliveries.

Fast food chains have felt the impact of inflation as cash-strapped customers have become more cautious in patronizing many restaurants. A survey in May found that 80% of Americans considered fast food a “luxury” due to its high prices.

MCDONALD’S GIVES CLASSIC MENU ITEM A ‘MAKEOVER’ AGAINST PUSH TO REVERSE SALES DECLINE

An employee fills a bag with fries at a branch of the fast food chain McDonald’s. A major supplier of French fries has closed a plant in Washington, the company said last week. (Matthias Balk/photo alliance via Getty Images / Getty Images)

To win back customers, many chains launched meal deals. Over the summer, McDonald’s launched a $5 Meal Deal, which includes a McDouble or McChicken sandwich, four-piece chicken nuggets, small fries and a small fountain drink.

FOX Business has contacted McDonald’s.

Other rivals such as Burger King and Wendy’s also launched similar offers that also come with fries. Despite the affordable meals, demand for fries has fallen, Werner says.

“It’s important to note that many of these promotional meal deals have consumers frying from medium to small,” he says.

A McDonald’s McDouble cheeseburger, small fries, four-piece chicken nuggets and a small soft drink, arranged in New York, USA, on Monday, June 17, 2024. On June 25, McDonald’s launched a marketing campaign and a new $5 meal deal, raising the stakes (Lucia Buricelli/Bloomberg via Getty Images/Getty Images)

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According to Lamb Weston, U.S. restaurant traffic fell 2% last quarter and 3% the quarter before compared to the same period last year.