The UK appears to be heading for a food price war as Morrisons tries to win back customers from Aldi and Lidl.
The supermarket announced that it will slash its prices and invest £1bn on product improvement over the coming three years.
The announcement comes in the wake of a £176m pre-tax loss for the year to February and a fall in sales of nearly 3%. It caused a drop in the share price not only of Morrisons but also its competitors, J Sainsbury and Tesco.
Morrisons appears to have recognised that food shopping in Britain has changed and that it needs to compete better with the discount markets.
Its chief executive said: "The strategy we are announcing today is a bold and comprehensive response to the fundamental structural changes that are taking place in grocery retail.”
Morrisons has been criticised for being slow in offering online shopping to customers. Now it is pledging “online and convenience offers”.
