BUSINESS
10/18/2014 11:09 am ET Updated Dec 06, 2017

Chipotle Founder Calls Competition From Fast Food 'A Joke'

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Chipotle isn't concerned about competition from the fast-food industry.

The burrito chain's soaring stock price has rivals like Yum Brands, which owns Taco Bell, KFC and Pizza Hut, scrambling to cook up concepts that, like Chipotle, use high-quality, fresh ingredients.

But Chipotle founder Steve Ells doesn't see them as a threat.

"It's a joke," Ells, who serves as co-CEO, said in an interview published this week by Fast Company. "You know those guys, right?"

chipotle burrito

Chipotle's stock price (blue) has grown at a much faster rate than those of traditional fast-food rivals McDonald's (red), Yum Brands (yellow), Burger King (green) and Wendy's (indigo).

Plagued by a reputation for mystery-meat concoctions and food so chemically altered that it won't decay, behemoths like McDonald's and Taco Bell have kicked off campaigns to debunk negative perceptions of their menu items. Despite their attempts to introduce more healthful fare, Ells said, the companies are still too stuck in their ways.

"They can't change," he said. "The culture is too ingrained. Which bodes well for Chipotle."

But they can try. Earlier this year, Yum launched Banh Shop, a Vietnamese street food chain, in Dallas. In a more direct challenge to Chipotle, the company also opened U.S. Taco Co., an upscale taqueria, in Huntington Beach, California. Both restaurants use fresh ingredients, which command higher prices than typical fast food.

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