JD Power: Dramatic Increase in Satellite Radio Installations

According to a report issued by JD Power, satellite radio is becoming very prevalent in the dashboards of new cars. The survey conducted by JD Power noted that 55% of the respondents stated that their car has satellite radio capability. This represents a sharp 41% increase over the same period last year.

“New-vehicle buyers are looking for the latest technologies in audio systems, and the presence of features such as satellite radio and navigation systems will only increase as manufacturers try to meet consumer demand,” said Allison LaDuc, senior research manager of automotive product quality at J.D. Power and Associates.

The survey was not small potatoes either. 81,530 people who bought 2008 model year vehicles participated. 2009 is set to see installation increases even beyond what we have seen in 2008. Extrapolating the 55% into an anticipated 15,000,000 new car sales this year would mean well over 8,000,000 satellite radio installations in OEMs for 2008. With a take rate of 50%, that would mean 4,000,000 subscribers.

The survey also noted problems per 100 vehicles in their audio gear. The results are interesting. If you have an AM/FM/Single CD/SAT head unit, Delphi has the fewest problems, and Fujitsu Ten the most. If your head unit has AM/FM/Multi CD Changer/SAT, then you hope to have a Clarion unit. Pioneer ranked last in this category.

• JD Power Press Release via CNN

Disclosure: Long SIRI

Comments

[valuestocksonly]

I keep harping on this Tyler, but the used car segment with Sat ready cars and trucks is growing rapidly and no one on Wall Street is taking this into account.

[voteforsanjia]

I think there is a lot of room for improvement on the retail channel side that is not far off. Used car dealers I've seen aren't installing radios, people buy them later at Best Buy etc. to have them installed. It would be hard to get a handle on the lower tier dealer used car channel because it is not centralized. Used cars at the authorized dealer level should be under similar incentives as with a new car to add satrad options to sales. I have a factory radio/CD but didn't rip it out, but somewhat reluctantly added the sat radio to my dashboard real-estate. We need motivation to make people want to replace the factory radios from people like Kenwood, Sony etc. and obviously need sweet OEM radio/cd/mp3 players. Obviously some incentives at the retail end would be good as well as completely ending the single use radio as soon as possible to eliminate the choice barrier at purchase or test time. I also think that the antenna options are sorely lacking and the sooner we stop sticking boxes to the roof and running wires out the trunk and window the faster we will see increases in adoption. There should be an OEM option for antennas to fit or retrofit all late model cars.