Sonic CEO: I can’t say minimum-wage hikes will cause job cuts

Minimum-wage hikes for fast-food workers will likely lead to pricier burgers, but job cuts aren't necessarily likely at Sonic, Chairman and CEO Cliff Hudson said Tuesday.

"I cannot tell you it will cause us to lose jobs because I don't know that's the case. The question is how much price elasticity we have in order to offset these costs," he told CNBC's "Squawk Box."

Opponents of the national campaign for a $15 minimum wage have warned higher pay could result in lower employment and more automation as franchisees struggle with added labor costs.

While many fast-food chains are large corporations, individual locations are often operated by franchisees, who are responsible for balancing sales and expenses at their restaurants.

Hudson said Sonic's model is not set up for layoffs because the company focuses on made-to-order food and personal service, including delivery by car hops at many locations.

Sonic's leadership will meet with franchise operators to coach them on how to raise prices annually to offset higher wages in a manner that doesn't impede their business, Hudson said.

New minimum-wage requirements in a number of states present challenges for Sonic, but food price hikes will be outstripped by increased pay among low-income workers, he added.

Hudson also said Sonic will accelerate its support for Donors Choose, a website that helps teachers raise money for classroom expenses, donating $3 million a year for the next five years.

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