October 2007 U.S. Auto Sales and SDARS Relationships
Auto sales for October 2007 have been posted, and the results are a mixed bag. Twenty of the brands saw an increase in sales over last year, while fifteen have seen a decline. Auto sales are important to the satellite radio sector because they represent a large driver for getting consumers to at least experience what satellite radio has to offer. Data from XM indicates that slightly over half of those who experience satellite radio in their car elect to continue the service. While Sirius does not offer take rate data, it appears to be somewhat in line with XM’s experience (though extrapolation is difficult).
The data presented here does not represent satellite radio installations, but rather vehicle sales. The satellite radio partner of each brand is reflected in the data. It should be noted that not all brands are not equal in terms of satellite radio installation penetration. Some auto makers install at a much deeper percentage than others. Also important to note is that not all OEM deals are the same. Among the differences are the length of the initial subscription, the subsidy paid for the installation, monies received for the subscription, and the amount of revenue share paid to each manufacturer. Simply stated, some OEM deals are more profitable than others.
One specific change in the data is reflected this month in Nissan Motors. Nissan currently has a dealer install program with Sirius and a factory installed program with XM. The status of the Sirius dealer install program beyond the 2007 model year has not been announced, but many industry watchers feel that it will no longer be available in 2008 model year cars. However, there are still 2007 model year cars available where the consumer has a choice of service. Because of this we have assigned 25% of Nissan Motors to Sirius and 75% to XM. When more clarity is offered, or if the merger happens, or when the 2007 model year cars are sufficiently thinned out, the data will be reflected accordingly.
Position – Long Sirius, Long XM, No Position OEM’s
