Subway has ignored 'screams for help' from shop owners and risks being 'gobbled up' by this fast-growing rival

Published

7 months ago

December 2, 2024

admin

Subway has ignored “screams for help” from its struggling franchisees for years — and is now at risk of being “gobbled up” by a fast-growing rival, a lawyer representing thousands of sub shop owners warned.

Subway last week said CEO John Chidsey will “retire” at the end of the year — five years after he became the first executive outside the founding family to lead the chain. That’s despite the fact that Chidsey had said he planned to stay after the company was sold in May for $9.5 billion to Roark Capital.

As Subway announced the CEO exit, it also revealed it was scrapping its $6.99 footlong deal a month early after admitting to franchisees the deal is not driving anticipated results, Restaurant Business Magazine reported.

Subway’s downbeat headlines came in stark contrast to recent news from a much smaller competitor, Jersey Mike’s. The latter now operates just 3,000 US locations versus Subway’s 20,000 — yet sold itself to buyout firm Blackstone Group for $8 billion, not far off what Subway fetched six months earlier.

Subway’s $6.99 footlong promotion was the latest in a series of punishing moves under Chidsey for Subway franchisees, who are forced to pay an 8% royalty fee on gross revenue regardless of their profitability.

Chidsey has likewise forced franchisees to remodel restaurants despite uncertainty on returns and pay undisclosed technology fees, according to Robert Zarco, who provides counsel for the North American Association of Subway Franchisees, which represents about half of Subway’s 20,000 US restaurants.

If Subway keeps treating its franchisees the way it has over the last five years where it is ignoring their screams for help, Jersey Mikes will have an easy task of gobbling up the Subway brand,” Zarco told The Post.

I hope its the reason for the change because it should have been,” Zarco added, referring to Chidsey’s exit. Because of the tensions that are prevalent, it is a good move for Roark to come in and wipe the slate clean and establish a better working relationship with the franchisees.”

Chidsey had not made any notable overtures to NAASF, Zarco said.

Roark — which owns dozens of major fast-food chains including Dunkin’, Arby’s, Sonic, Baskin-Robbins and Buffalo Wild Wings — didn’t respond to requests for comment.

At a hastily assembled meeting in August, Subway President Douglas Fry admitted that sales were down 5% to 10% year-to-date in many regions. Meanwhile, he estimated that Jersey Mike’s same-store sales, or sales at stores open at least a year, had risen 1%, sources told The Post.

Were doing worse than the rest of the industry, Fry admitted at the time, according to the sources.

But the $6.99 footlong deal prescribed by CEO Chidsey — a former Burger King CEO — only made things worse, according to franchisees.

This is the first time I havent honored a promotion, a franchisee with more than 10 Subway restaurants in the US Northeast told The Post.

That store owner was one of the lucky ones: While most Subway franchisees who signed contracts before 2021 can opt out of promotions, newer franchisees were forced into the money-losing deal.

The last 20 days have been kind of hellish, a Subway employee wrote Wednesday on Reddit about the value meal. It might have gone better if the higher-ups actually worked in the store and saw why the owners didnt want it to be for any sub.

The franchisee griped that under the promotion, a single customer could order four Monster Subs, which have steak, pepper, cheese and onion, for less than $30. As a result, the $6.99 footlong deal failed to improve his gross sales, even as his costs skyrocketed.

Subway is making Carrie Walsh, President of its Europe, Middle East and Asian regions, its interim CEO. Zarco said she is liked by some of the Subway franchisees who know her.

Subway has shrunk by 15% over the past four years, from 23,799 US restaurants on Jan. 1, 2020 — shortly after Chidsey took the helm — to 20,133 on Jan. 1, 2024, according to public filings. The chain is believed to have gotten a bit smaller this year, sources said.

Meanwhile, the average Jersey Mikes, whose CEO Peter Cancro has become a billionaire off the Blackstone deal, makes about three times as much money as the average Subway, according to public filings.

Blackstone buying Jersey Mikes tells me its time for me to run, the Northeast-based Subway franchisee with more than 10 restaurants said, adding that he could easily see Jersey Mikes more than doubling in size soon to 8,000 US restaurants.

Blackstone Senior Managing Director Peter Wallace on Nov. 19 said his firm had deep experience helping accelerate the expansion of high-growth franchise businesses like Jersey Mikes.

Environment

GM’s interesting electric motorcycle patent fuels two-wheeler speculation

Published

2 hours ago

June 22, 2025

admin

GM's interesting electric motorcycle patent fuels two-wheeler speculation

General Motors may be better known for its lineup of full-size trucks and SUVs, but a recently published patent shows the legacy automaker has at least considered something much smaller and nimbler: an electric motorcycle.

The patent, which surfaced earlier this year in a report by Visordown, outlines a lightweight, scrambler-style electric two-wheeler that has set off a fresh wave of speculation about GM’s potential interest in electric motorcycles or micromobility.

The design in the patent filing shows a slim electric motorcycle with a flat bench seat, upright handlebars, and dual-sport tires, suggesting a utility-forward ride meant for light off-road or potentially even mixed urban use (if it were homologated for street use).

The rear hub motor and what appears to be a central battery housing point to a simple, low-maintenance drivetrain, potentially aimed at the commuter or recreational rider market.

Advertisement – scroll for more content

The overall look is somewhere between a moped and a small electric dirt bike, reminiscent of models like the Sur Ron Light Bee or Talaria Sting, though slightly more street-looking with less of a focus on pure dirt.

While the patent doesn’t include performance specs or firm production plans, it’s the clearest signal yet that GM is at least experimenting with the idea of higher-powered two-wheeled EVs. And there is some precedent. GM previously dipped a toe into the micromobility waters with the Ariv electric bicycle project, and more recently partnered with Recon Power Bikes to release a Hummer-branded fat tire e-bike.

Both efforts showed that GM sees value in offering electric alternatives beyond the traditional four-wheel format, even if the Ariv program quietly ended after a short run.

gm ARĪV ebike — GM previously experimented with an in-house electric bicycle known as the ARĪV, though it was killed off soon after

Whether this patent leads to a full-fledged GM electric motorcycle remains to be seen. It’s entirely possible the design is a concept or technology demo with no intention of hitting the market. But there are other possibilities too. GM could develop a motorcycle under one of its existing sub-brands, create a new division specifically for electric powersports, or partner with an existing two-wheeler manufacturer to license or co-develop the platform.

The timing wouldn’t be far-fetched. Despite bumpy roads in the larger flagship electric motorcycle market, lightweight electric motorcycles are booming, with companies like Ryvid targeting urban riders looking for clean, compact alternatives to traditional gasoline-powered bikes.

At the same time, a growing number of younger consumers are bypassing car ownership entirely, instead looking toward e-bikes, scooters, and low-speed electric motorcycles for daily transport. A small, stylish, and affordable GM electric motorcycle could hit that sweet spot.

Of course, turning a patent drawing into a real-world vehicle is a big leap, and GM’s own e-bike history is a reminder that two-wheeled projects can be short-lived. Still, it’s hard to ignore the symbolism of this move: even one of America’s largest automakers is exploring what personal electric transportation looks like when you cut the vehicle in half. GM might not be ready to ditch its trucks, but it clearly hasn’t ruled out hopping on a bike.

FTC: We use income earning auto affiliate links. More.

Politics

Signal trading ‘school’ and fake exchange rob investor of $860K: Lawsuit

Published

3 hours ago

June 22, 2025

admin

Signal trading ‘school’ and fake exchange rob investor of 0K: Lawsuit

A Florida man says a Denver-based crypto trading school and a fake exchange tricked him into handing over $860,000 through phony trade signals.

UK

‘Stability in Middle East is priority,’ says Starmer – as world reacts to strikes

Published

4 hours ago

June 22, 2025

admin

'Stability in Middle East is priority,' says Starmer - as world reacts to strikes

Sir Keir Starmer has said stability in the Middle East is “a priority” following US strikes on Iran’s nuclear facilities, as the world has reacted to the attack.

The prime minister also called on Iran to “return to the negotiating table” to “reach a diplomatic solution to end this crisis”.

Follow latest: Iran considering ‘all options’ after US strikes

In a statement, Sir Keir said: “Iran’s nuclear programme is a grave threat to international security.

“Iran can never be allowed to develop a nuclear weapon, and the US has taken action to alleviate that threat.

“The situation in the Middle East remains volatile and stability in the region is a priority.

“We call on Iran to return to the negotiating table and reach a diplomatic solution to end this crisis.”

The UK was not involved in the strikes but was informed about them in advance by the US, Business Minister Jonathan Reynolds told Sky News’ Sunday Morning with Trevor Phillips.

Sir Keir and Foreign Secretary David Lammy had been pushing for a diplomatic solution. On Thursday, the prime minister warned of a “real risk of escalation” in the conflict.

The US struck three sites in Iran early on Sunday morning, with Donald Trump boasting the country’s key nuclear sites were “completely and fully obliterated” in an address to the nation from the White House and warned there could be further strikes if Iran retaliates.

Netanyahu praises Trump

Israel‘s Prime Minister Benjamin Netanyahu praised Mr Trump for the strikes, saying: “Your bold decision to target Iran’s nuclear facilities with the awesome and righteous might of the United States will change history…

“History will record that President Trump acted to deny the world’s most dangerous regime the world’s most dangerous weapons.”

UN secretary-general ‘gravely alarmed’ by US attack

But UN secretary general Antonio Guterres said he was “gravely alarmed by the use of force” by the US against Iran.

“This is a dangerous escalation in a region already on the edge – and a direct threat to international peace and security. There is a growing risk that this conflict could rapidly get out of control – with catastrophic consequences for civilians, the region, and the world.”

European Union foreign policy chief Kaja Kallas urged all sides to step back and return to the negotiating table. “Iran must not be allowed to develop a nuclear weapon,” she said in a post on X.

“I urge all sides to step back, return to the negotiating table and prevent further escalation,” she said, adding that EU foreign ministers will discuss the situation tomorrow.

How the world reacted to the strikes

Cuba’s President Miguel Diaz-Canel said on X: “We strongly condemn the US bombing of Iran’s nuclear facilities, which constitutes a dangerous escalation of the conflict in the Middle East.

“The aggression seriously violates the UN Charter and international law and plunges humanity into a crisis with irreversible consequences.”

Venezuela’s foreign minister Yvan Gil said his country’s government “condemns US military aggression” and “demands an immediate cessation of hostilities”.

In a statement, an Australian government spokesperson said Iran’s nuclear and ballistic missile programme “has been a threat to international peace and security”.

Japan’s Prime Minister Shigeru Ishiba said it is “crucial that there be a quick de-escalation of the conflict”.

Italy’s foreign minister Antonio Tajani said after the attack that his country’s government hopes “a de-escalation can begin and Iran can sit down at the negotiating table”.

The US attack came after more than a week of strikes by Israel, which have significantly degraded Iran’s air defences and offensive missile capabilities, and damaged its nuclear enrichment facilities.

Israel’s strikes on Iran have killed at least 865 people and wounded 3,396 others, according to the Washington-based group Human Rights Activists. The group said of those killed, 365 were civilians and 215 were security force personnel.