NEW YORK (AP) — It's going to be another challenging year for supermarket retailers in the United Kingdom.
Wal-Mart's United Kingdom operation Asda, is investing another 500 million pounds ($721.9 million) in price cuts as the grocery discount wars escalate.
The investment is on top of the one billion pound investment ($1.44 billion) in price cuts begun in 2013 that Asda planned until late 2018.
Wal-Mart's Asda also said Sunday it has joined the European Marketing Distribution, which pools the collective buying power of 250 supermarket chains, so it can realize the savings.
The moves come as Asda and the country's other top traditional grocery rivals —Tesco PLC, Sainsbury's and Morrisons —have been cutting prices to respond to the increased competition from Germany-based no-frills discounters Aldi and Lidl. The German discounters offer sharp discounts every day but with limited assortment.
"There is currently no growth in the food market, and the rise of the limited-assortment discounters means that we must take radical action to win back our customers," said Andy Clarke, Asda's president and CEO in a statement.
ASDA is expected to release fourth-quarter figures next month when Wal-Mart announces results. Asda saw a key sales figure — revenue at stores open at least a year — fall 4.6 percent in the third quarter.