Chipotle pilots new line of robots in California after $20 per hour wage

(The Center Square) - Chipotle Mexican Grill announced it is piloting an automatic avocado peeler and pit remover at one California location, and an automatic bowl and salad machine at another as higher minimum wages increase relative yields from automation.

Earlier this year, Chipotle raised its prices up to 7% in California to account for the state’s new $20 per hour minimum wage for fast food employers.

“These robotic devices could help us build a stronger operational engine that delivers a great experience for our team members and our guests while maintaining Chipotle's high culinary standards," said Curt Garner, Chief Customer and Technology Officer at Chipotle in a statement. "Optimizing our use of these systems and incorporating crew and customer feedback are the next steps in the stage-gate process before determining their broader pilot plans."

Chipotle says it invested $100 million across the two companies making specialized robots for its stores; given Chipotle says it takes staff 26 seconds to pit and peel each of the 129.5 million avocados it uses each year, an estimated two avocados per pound would mean the Autocado machine could save almost 1.9 million staff-hours per year, or just over 238,000 days of workers’ labor — that’s over $37 million per year at $20 per hour.

While estimates for savings from the Makeline automatic bowl and salad maker were not shared, it’s likely savings are in the same ballpark. Robots do not go on strike, break, or vacation, and do not need to be hired, fired, or trained.

As governments mandate higher wages, major corporations like Chipotle are pouring in significant capital to reduce labor needs and maintain or even grow long-term profitability. But business leaders say small businesses tend to lack the capital and expertise to deploy custom-made robotics, and are thus more likely to be the ones stuck choosing between shutting down or cutting staff.

“It must be a nice luxury for the larger business to have the capital and wherewithal to accommodate and adjust, but many business, 99.2% being small business, simply do not have that luxury,” said John Kabateck, California director of National Federation of Independent Business, a national small business advocacy group, to The Center Square. “They’re left holding the bag and being forced to shut their doors and lay off the very people minimum wage proponents portend to help.”

In an earlier interview with The Center Square, Kabateck noted small businesses not subject to the fast food minimum wage nonetheless often have to pay it, as they compete for the same pool of entry level workers.

In August, California Gov. Gavin Newsom said fast food employment is at record levels, setting a record 750,500 jobs in July of 2024.