Mobile Entertainment, Navigation & Telematics Occupy Retail Channels for Holiday Sales
MINNETONKA, Minn.--Dec. 2, 2004--Mobile audio and entertainment devices used in cars are hot products this holiday season according to retailers of consumer electronics and automotive aftermarket products. The obvious breakout category is digital entertainment with back-seat DVD-based systems going for as little as $500.Another hot automotive category is interface kits that allow portable media devices to be played through the car's audio system. These are the products that are riding the success of Apple's iPod, says Telematics Research Group (TRG), a research and intelligence firm that tracks automotive electronics and wireless trends.
"Hard drive or flash-based portable music players are so common that there is a pent-up demand for kits that allow you to listen to them through the vehicle's audio system," says Phil Magney, principal analyst at TRG. "We are seeing a slew of aftermarket products coming in the market that integrate iPods with the audio system."
Portable navigation systems are also beginning to get attention from retailers with PDA-based products that sell for as little as $550. These products provide the same type of navigation as those in new cars but offer the portability and functionality of a PDA. "Business people love these things because they can be taken from vehicle-to-vehicle, or brought into the rental car when traveling in a strange city," says Magney.
According to TRG, we are not seeing much retail demand for so-called "telematics tracking devices," but next year could be a breakout year. According to TRG's aftermarket database, a handful of new products have entered the channel designed to undercut OnStar's more expensive factory-fit solution.
Vehicle tracking systems are small "black boxes" installed in cars that combine GPS with wireless so a vehicle can be tracked over the internet. "The most compelling application is the ability to track your teenage driver, or your fleet if you are a business owner," says Magney. "What's more, these devices can be programmed to send you an alert if the vehicle exceeds a certain speed limit, or passes outside of a predefined area."
Summary and Forecast
In the short term, the retail aftermarket may stand to gain the most from these emerging categories as their ability to bring new technologies to consumers is generally quicker--and at lower prices--than automotive OEMs. The auto companies will get their fair share of the market once the lead time necessary to get these products into production is shortened. Utilization of standard interfaces and the emergence of wireless options will also facilitate faster take-up rates.
Global Shipments(a) (in thousands)
2002 2004 2010
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Bluetooth Handsfree (in-car) 102 462 11,392
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Satellite Radio 349 2,198 15,089
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DVD Entertainment 1,125 3,371 9,170
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Telematics Tracking 2,143 2,992 16,005
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GPS Navigation 4,398 6,973 17,749
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(a) worldwide shipments consumer markets (in thousands)
About TRG:
TRG (Telematics Research Group, Inc.) tracks, analyzes, and forecasts the market for automotive telematics, including in-vehicle wireless devices, navigation and digital entertainment. TRG conducts a global telematics survey of these technologies and publishes this information through reports and on-line research services.
TRG was established in 2001 and expanded its operation in January 2004 with the formation of TRG Europe GmbH, a joint venture between TRG and Dornier Consulting (Sindelfingen, Germany).
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