McDonald’s Withdraws from Iceland
The three McDonald’s outlets operating in Iceland are going to close shop, victims of the collapse in the value of Iceland’s currency.
Subway, Reykjavik, Iceland (my photo, available under cc license)
When I was in Nizhny Novgorod in 1998 when Russia defaulted on its debt, I remember a McDonald’s guy explaining to me that the company tried, when feasible, to make sure that expenses and purchases were happening in the same country. So you buy Russian potatoes with rubles and sell french fries in Russian cities for rubles. Icelandic agriculture isn’t going to be able to work as a McDonald’s supplier (great butter, though) so presumably they were importing tons of stuff and thus exposed to a great deal of currency risk. Perhaps if Iceland joins the EU and adopts the Euro, they’ll get their McDonald’s back.
Meanwhile, I wonder about other fast food outlets. The American fast food chain I went to in Iceland was Subway. Are they still there?
26 Responses to “McDonald’s Withdraws from Iceland”
Register
RSSLogin
Topic Cloud
ArchivesBlog RollAbout Matt YglesiasContact Me
Donate
October 27th, 2009 at 4:05 pm
God that’s a crappy photo.
So does this mean that The Economist is going to have to fiddle with their Big Mac index?
October 27th, 2009 at 4:08 pm
The real question is what was Rose Tyler doing in a Subway in Iceland and whether the Doctor was nearby as well.
October 27th, 2009 at 4:08 pm
Subway was around in August ‘09. So was KFC.
But who needs American fast food when you can eat horse, whale and puffin in Icelandic restaurants?
October 27th, 2009 at 4:08 pm
Does that mean we can go to war with them now?
October 27th, 2009 at 4:09 pm
I was going to email you this article but I forgot and anyway I knew you’d find it sooner or later. Iceland + fast food = Yglesias blog bait.
October 27th, 2009 at 4:12 pm
The headline is misleading. McDonald’s Corporation isn’t withdrawing from Iceland. There is one franchisee in Iceland with three restaurants in the capital city, and as reported in the NY Times, he imports nearly everything from McDonald’s in Germany. As Matt rightly concludes, exchange rates have made it too expensive for him to continue business.
Whether or not McDonald’s returns will depend on whether another local business person decides to buy a franchise. It’s unlikey that McDonald’s Corporation will open a corporate-owned store there given the small size of the market.
October 27th, 2009 at 4:13 pm
So the secret to American public health policy is to devalue the dollar and default on our foreign debt!? This is like a Grand Unified Conspiracy Theory in the making!! Somebody figure out how to work in fluoride and somebody else grab a url… we’ve got to get this out before Beck or Bachmann sees it!
October 27th, 2009 at 4:14 pm
I went to a Quiznos there a year and a half ago (it was about all I could afford there back when the currency was sky high). I remember there being a lot of lamb on the menu, which implies that they were at least trying to avoid some of the importation problems.
October 27th, 2009 at 4:14 pm
The real question is what was Rose Tyler doing in a Subway in Iceland and whether the Doctor was nearby as well.
Duh, they are going back in time to save Iceland’s fast food restaurants from the coming economic crash!
October 27th, 2009 at 4:33 pm
good butter? then Mickey D in Iceland needs to get its Texas on
October 27th, 2009 at 4:33 pm
Yup – Subway is still in Iceland, and doing great. Apparently the owner has run the business in a exemplary manner, not incurring any debt, and not turning his company into a hedge fund or a leveraged buyout vehicle and expanding abroad, buying up companies in Scandinavia and England with Icelandic bank funds like so many other local companies.
The Icelandic McDonalds was never particularly good – far inferior to local franchises – and was too expensive. Personally, I could not care less, and many of my countrymen are rejoicing – especially some on the left who think this is a great irony and a fitting close to the circle of history as the first McDonalds was opened by then prime minister mr Oddsson, who was the central bank director when the economy collapsed. Mr Oddsson of course was, rightly or wrongly, closely identified with the Icelandic economic “miracle”.
But because we lived in the US for eight years, and my kids grew up there, I know they weill miss this piece of America they had here in Iceland.
October 27th, 2009 at 4:42 pm
So the secret to American public health policy is to devalue the dollar and default on our foreign debt!?
No, as Saudi Arabia is to oil the US is to food. As much as we eat we are still able to export 10s of billions worth of food every year.
October 27th, 2009 at 4:45 pm
That’s great. Any blow to globalisation is a good thing in my book.
October 27th, 2009 at 4:53 pm
With all due respect to Tarantino you know that a culture is headed to the dark side when American fast food joints get their claws in.
October 27th, 2009 at 4:54 pm
so that’s the reason to join the EU – so they can get their McDonald’s back? Not too Amero-centric, are we?
October 27th, 2009 at 5:09 pm
A world without Puffin McNuggets is a sad world indeed.
October 27th, 2009 at 5:17 pm
There’s still a KFC, Subway and Pizza Hut. However, there’s no need to go to an overpriced American chain, as there’s quite a bit of local fast food. Several Pizza chains, including Pizza 67 and Pizza Huse∂ and the Aktu Taktu hamburger drive ins. And don’t forget the Baejarins Beztu Pylsur (hot dog) stand near the Kolaporti∂ flea market with the photo of Clinton visiting. Pylsur og Kók was still only 220 kroner this summer when we were last there.
October 27th, 2009 at 5:51 pm
BRIC CORNERS CRITICAL RESOURSE MARKETS
[BRIC] The Cash and Carry Trade
The [BRIC] Sphere of Influences, Brazil, The Russian Federation, India, and The Peoples Republic of China, are engaged in The Cash and Carry Trade, of borrowing cheap worthless [Bernanke Butterfly Effect Economic Asset Inflation Bubble Dollars] from the American-Israeli Empire Federal Reserve System, which is then plowed into higher-yielding assets which are far less vulnerable to price fluctuates, virtually, a value that’s not likely to disappear entirely, as a Storage Place of Value. But beyond this the [BRIC] is engaging in the cornering of strategically importance raw materials, recourses, companies building reactors nuclear plants, refineries, pipelines gas power stations cutting deals left and right all over the world, with the average value of each deal growing by leaps and bounds; (Nigaz) an amalgamation of “Nigeria” and “Gazprom”, pronounced “nye-gaz”, (GECF) Gas Exporting Countries Forum the (11) Eleven biggest gas-rich producing states in the world Algeria, Bolivia, Brunei, Egypt, Indonesia, Iran, Libya, Malaysia, Nigeria, Qatar, The Russian Federation, Trinidad and Tobago, the United Arab Emirates and Venezuela (PDVSA) State owned oil company Orinoco River oil venture,(OPEC) Organization of the Petroleum Exporting Countries.
Groups and investing in commodities futures as a hedge against the decline of the devaluation of the dollar;
* Natural resources & mineral resource companies and investments
Gold: Mining Companies, Bullion, and Coins.
Copper: has surged [94.6%] Ninety-Four-Point-Six Percent this year gobbling up copper like there’s no tomorrow.
Lumber/Timber
Rubber
Oil and Oil reserves: oil has roughly doubled from its lows in January of this year ($145/€99) One-Hundred-forty-Five-Dollars/Ninety-Nine Euros, with the cost of oil per barrel expected to once again rise to their post highest level and surpass it of ($145/€99) One-Hundred-Forty-Five-Empire Dollar/Ninety-Nine-Euro’s, per barrel.
Pipelines Gas and Oil: Blue Stream, Nord Stream, South Stream, the Arctic Lomonosov Ridge containing (13%) Thirteen Percent of the Worlds Oil Reserves and (30%) Thirty Percent of the worlds Natural Gas.
Gasoline/Petro: Higher prices at the pump, Wholesale prices are up more than [$0.40/€0.27] Forty-cents/Zero-Point-Twenty-Seven Euros a gallon in just under a month. The Previous cost of gas at the pump, highs were [$5/€3.42] Five-Empire Dollars/Three-Point-Forty-Two Euros, per gallon now think [$10/€6.84] Ten-Empire Dollars/Six-Point-Eighty-Four Euros, per gallon, or higher.
Heating Oil: A dramatic escalation in heating bills as the cost has jumped to the highest price in almost a year.
* Railroads and shipping lines
* Commodities
BREAD: More Expensive
Cereal: More Expensive
Cocoa: is jumping, up over [30%] Thirty-Percent this year.
Corn: It’s up almost a [$1/€0.66] One-Dollar/Zero-Point-Sixty-six Euros a bushel since mid-September, with the cost of wheat and soybeans on the rise.
Soybeans: More Expensive
Sugar: has exploded higher, up over [70%] Seventy-Percent at a [26] Twenty-Six year high [More profit putting it into the gasoline /petro business tanks than in Commodities Coffee and Tea Cups].
Rice: More Expensive
Wheat: futures are the highest level in almost [3] three decades.
FOOD/PRODUCE: And all it will mean is [DOUBLE DIGET INFLATION IS NEXT], it cost an [Energy Currency] to produce items, [Food/Produce], the cost to the Farmer goes up, The cost to Truckers to Deliver the Produce to Market’s goes up and the cost is passed to the consumers, and that is capitalism, Commodities are the most obvious example.
[Bernanke Butterfly Effect Economic Asset Inflation Bubble Dollars]
Fed boss Ben Bernanke has caused a Butterfly Effect that is bring down one institution and one country after another, [S&P] Standards and Poor index is expected to decline by [40%] Forty-Percent, the [NYSE] New York Stock Exchange to drop to [6K] Six-Thousand range the empire is weakening under the weight of overwhelming, unplayable debts and obligations, with the Dollar in a rapid devaluation position, with The Peoples Republic of China only lowing its devaluation there is little to no time left to begin the shift to the [Diversified/Multilateral Currency Regime], based upon a broader trade-weighted basket. The Multilateral Currencies would be the GLOBAL NUMERAIRE CURRENCIES [Euro, Pound Sterling, Japanese Yen, and Chinese Yuan], and hard currency [Gold, Silver, etc.] will determine the price of Gold per ounce.
Scenario One: [$2.3K/€1.5K] Two-Point-Three Thousand Dollars/One-Point-Five Euros, Orderly transition to new currency
Scenario Two: [$3K/€2K] Three-Thousand Dollars, Two-Thousand Euros, Muddied, confused transition
Scenario Three: [$5K/€3.4K] Five-Thousand-Dollars/Three-Point-Four Thousand Euros, Chaotic transition and market panic [MOST LIKELY TRANSITION]
[NOW], is the time to shift off the Empire Dollar, and begin The Cash and Carry Trade to The Multilateral Currencies would be the GLOBAL NUMERAIRE CURRENCIES [Euro, Pound Sterling, Japanese Yen, and Chinese Yuan], and hard currency [Gold, Silver, etc.] investments in companies [Off of the NYSE] in strategically importance raw materials, recourses, and related industries companies, commodities futures, in markets other than Empire Markets, The Bottom is about to drop out from under the Dollar.
HERCULE TRIATHLON SAVINIEN
October 27th, 2009 at 5:54 pm
There’s still KFC, Subway, Pizza Hut, Domino’s, Quiznos and T.G.I. Friday’s. No Burger King, though, that franchisee threw in the towel last December. And I think Little Caesars gave up a couple of years ago.
And note that the (soon to be former) McDonald’s franchisee is going to keep running burger joints under a new name.
October 27th, 2009 at 6:11 pm
[...] learned from Matthew Yglesias that McDonalds is pulling out of Iceland, victims of that nation’s currency collapse. The BBC has more: McDonald’s is to close [...]
October 27th, 2009 at 6:49 pm
[...] learned from Matthew Yglesias that McDonalds is pulling out of Iceland, victims of that nation’s currency collapse. The BBC has more: McDonald’s is to close [...]
October 27th, 2009 at 9:15 pm
Surely there will be wild celebrations at Aktu Taktu tonight. Perhaps they will be emboldened and will consider coming to the US?
(I realize Aktu Taktu aren’t very good, but still… an Icelandic fast food restaurant in the US! I’d go there all the time.)
October 27th, 2009 at 9:18 pm
I’ve been seriously craving those hot dogs for about a week now. The sweet sauce and the weird crunchiness that I suppose were fried onions….
October 27th, 2009 at 10:37 pm
Why in the world travel all the way to a place like Iceland and then go to Subway?
Matt, wasn’t there a Björk’s Elfin Blubber Bistro or something like it that you could have tried out?
October 28th, 2009 at 1:18 am
The real question is who was Matt stalking, and why, and ps does his gf know about it.
October 28th, 2009 at 5:36 am
Did you try the Ice McMuffin?