DVD players go for a drive - Auto Update - sales of audio and video components for cars

DSN Retailing Today, July 21, 2003 by Debbie Howell

Entertainment products for the home may be hot, but many consumers are paying just as much attention to their vehicles, given stressful commutes and long family road trips.

Outfitting the car with personalized accessories has therefore moved upscale, with the latest evolution involving audio and video products, such as mobile entertainment centers sold at retailers that include Advance Auto Parts, Wal-Mart and Best Buy, to name a few.

"The biggest trend right now is video in the car. It's all about shutting the kids up in the back seat," said Rachel Branch, a senior public relations strategist with Sony.

Sales of mobile video products, including navigation aids, are predicted to grow 20% to $542 million this year, according to the Consumer Electronics Association. As for vehicle audio accessories, the CEA forecasts sales to grow 2% to $2.3 billion.

In audio, products gaining popularity are in-dash CD players, multi-disc CD changers, speakers and MP3 players. Also on the rise is satellite radio, possibly the next big craze in vehicle audio.

Late in 2001, digital satellite radio launched, delivering about 100 channels of music, news and information programming via satellite. XM Satellite Radio and Sirius Satellite Radio charge a monthly fee for their separate services, which require a special radio either purchased at retail or factory-installed. The combined subscriber base for these services reached nearly 800,000 this month and was projected at 1.5 million by year-end.

"It's on the fastest growth curve of any audio product in the last 20 or 30 years," said Dan Murphy, senior vp of retail marketing and distribution for XM. "This is something to be closely watched."

Expected Aftermarket Mobile Entertainment Purchases in Next Two Years

* In-dash single CD player           37%
* Multi-disc CD changer              34
* Component speakers                 29
* Power amplifier                    18
* Digital or satellite radio         13
* MP3 player                         12
* Mobile video entertainment system  12
* Equalizer                          12
* Cassette deck                      12
* AM/FM radio                        11

Source: CEA market research, 9/02