U.S. Taco Bells adding new Cantina menu in July

LOS ANGELES, June 6 Thu Jun 7, 2012 12:28am IST

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LOS ANGELES, June 6 (Reuters) - Mexican fast-food chain Taco Bell next month will roll out its more upmarket Cantina Bell menu across the United States, a move it hopes will deepen and expand its customer base while challenging popular burrito chain Chipotle Mexican Grill Inc.

The Cantina menu, which will debut nationally on July 5, includes tacos, burritos and bowls with suggested prices just under $5. Those items also are staples at fast-growing Chipotle, where they cost around $8.

Other Cantina menu offerings will be familiar to Chipotle devotees: black beans, cilantro rice and grilled corn salsa.

The nearly 5,600-unit chain's new menu features fresh ingredients and flavors. It was created by Miami chef Lorena Garcia, who appeared alongside Chipotle founder and co-Chief Executive Steve Ells on the reality television show "America's Next Great Restaurant."

The 50-year-old Taco Bell chain is part of Yum Brand Inc . Its core menu of relatively low-priced food appeals to mostly male teenagers and young adults, who have been hard hit by unemployment.

Taco Bell hopes that new menu items will spice up its sales, which went stale last year.

Most of the chain's restaurants are in the United States, where 2011 sales at established restaurants were flat in the first quarter, down 5 percent in the second quarter and off 2 percent in both the third and fourth quarters.

In the first quarter of this year, Taco Bell posted a better-than-expected 6 percent rise in same-restaurant sales, helped by the popularity of its new Doritos Locos Tacos.

Shares of Yum, with its leading KFC brand in China, were up 3.8 percent at $66.82 in afternoon trading on the New York Stock Exchange amid a broad market rally.

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