McDonald's on Thursday announced plans to test a plant-based burger using Beyond Meat patties in Canada.
The 12-week test will start Sept. 30 at 28 restaurants in Southwestern Ontario.
The item will appear on those menus as the P.L.T, which stands for plant, lettuce and tomato. The burger will sell for 6.49 Canadian dollars ($4.90), plus tax.
"This test allows us to learn more about real-world implications of serving the P.L.T., including customer demand and impact on restaurant operations," Ann Wahlgren, McDonald's vice president of global menu strategy, said in a statement.
Shares of Beyond Meat closed up 11% Thursday, while McDonald's shares were flat. Since its May initial public offering, Beyond's stock has surged 517%. However, in the last two months, the shares have tumbled 34% after a secondary stock offering, increased competition from Big Food rivals and concerns about its valuation.
Meat substitutes from Beyond Meat and Impossible Foods have soared in popularity this year, as more U.S. restaurant chains, like Dunkin' and Red Robin, add them to their menus. Burger King, which is owned by Restaurant Brands International, recently launched a version of its Whopper made with the Impossible burger nationwide.
"Overall, we continue to believe the best way to play on the demand for plant-based foods is through Restaurant Brands, with its national launch of the Impossible Whopper at Burger King, which could add 400 [basis points] to Burger King's U.S. comp," BMO Capital Markets analyst Peter Sklar wrote in a note Wednesday.
Restaurants are choosing plant-based burgers as a way to appeal consumers looking to cut down on their meat intake. The NPD Group found that 95% of people who buy these vegan burgers also made a beef burger purchase within the last year.
McDonald's has largely stayed on the sidelines, citing a desire to better understand the trend before stepping in. It already sells plant-based burgers in Germany and Israel in partnership with Nestle, which started selling its Awesome Burger at U.S. retailers this week.
Beyond Meat has expressed confidence in its ability to supply any restaurant chain. In June, CEO Ethan Brown told analysts that it could take on the largest fast-food chains, provided that it was done thoughtfully. McDonald's, which is the largest restaurant company in the U.S. by sales, has roughly 14,000 locations in the U.S.
