McDonald’s Will Offer $2 Espresso Drinks In Apparent Bid For Starbucks Customers

Want a Big Mac, fries and a caramel macchiato? McDonald’s (NYSE: MCD) is making that a possibility.

McDonald’s announced they will be offering a variety of new espresso-based drinks Wednesday, as part of a strengthening of its McCafé brand. McDonald’s will now offer caramel macchiatos, cappuccinos and Americanos as part of its menu. The cappuccinos can be flavored with French Vanilla, caramel or hazelnut. As part of a roll out promotion, the new drinks and all other McCafé drinks will be available for only $2.

The drinks will be in direct competition with Starbucks (NASDAQ: SBUX), which also offers espresso-based drinks, albeit at a higher price. By comparison, a tall caramel macchiato on average costs $3.95 at Starbucks.

McDonald's launched McCafé in the US in 2009, and it now generates about $4 billion annually in the US, according to Business Insider Wednesday. McCafé will also get a new and cleaner logo.

McDonald’s also released a series of bottled McCafé Frappé drinks in collaboration with Coca-Cola. The drinks will be available in grocery stores and come in three flavors: caramel, vanilla and mocha.

“This is just the start of our McCafé commitment,” said Chris Kempczinski, president of McDonald’s USA, in a statement. “We understand how important the coffee culture is for consumers and we are committed to meeting that demand at the taste, convenience and value only McDonald’s can offer.”

McDonald’s currently stocks are trading at a five-year high.

The bottled drink move comes hot on the heels of a new rollout from Dunkin’ Donuts (NASDAQ: DNKN), which recently began selling bottled drinks at convenience stores and grocery stores. Starbucks began selling a bottled frappuccino drink in 1996, according to USA Today.

The McCafé concept began in Melbourne, Australia in 1993. A licensee opened up a stand-alone coffee shop with the McDonald’s brand. McCafé was the largest coffee shop in Australia and New Zealand by 2003. The U.S. McCafé-brand products are available at most McDonald’s locations.