Early indications on September auto sales indicate that while sales seem to be dipping from August, they should come in high enough to keep the SAAR over 14 million. Of course the key for SiriusXM is that sales are strong enough to keep an influx of gross subscriber additions coming through the proverbial door.
According to Edmunds, new car sales for September should be in the neighborhood of 1,123,000 vs the 1,285,000 we saw last month. While that drop may seem substantial, the SAAR would still be just above 14 million. For SiriusXM, we like to see sales of over 1 million and the pace for September will deliver that with relative ease. With the used car channel also becoming more of a factor there should be little worry about how September auto sales will impact the company.
Current subscriber guidance for SiriusXM is at 1.6 million. The company already has over 1 million in the bank, and with Q3 shaping up the way it is, the company could challenge its own guidance as early as this quarter. In fact, there is sound reason to see 2 million as a possible target for the whole year. That being said, look for the company to be fairly conservative when they update guidance.
While there is still a couple of weeks in September, we should see strong enough numbers to keep satellite radio investors upbeat.