March 24, 2005
2 Automakers Reach Deals on Installing Satellite Radio By BLOOMBERG NEWS
http://www.nytimes.com/2005/03/24/business/media/24satellite.html?pagewanted=print&position=
XM Satellite Radio Holdings said yesterday that its radios would be installed in cars made by the Hyundai Motor Company for sale in the United States, while Sirius Satellite Radio said receivers for its service would be included as options on some Range Rovers and Jaguars, made by Ford Motor.
XM Radio said Hyundai Motor America would be the first automaker to install its radios as standard equipment. Sirius said its receivers would be offered as factory-installed options beginning in May on some Jaguar models and beginning in July on some Range Rovers.
XM, the largest subscription-radio service, and No. 2 Sirius are trying to persuade automakers to install the radios at factories to increase the likelihood that vehicle buyers will subscribe. About 6 of every 10 buyers of cars with XM radios installed subscribe to the service, said an XM spokesman, Chance Patterson.
April Horace, an analyst at Janco Partners in Greenwood, Colo., who has a buy rating on both companies and does not own the shares, said, "It's a great win for XM."
"Clearly XM has stronger backing" among carmakers, she added.
About 75 percent of Hyundai's cars in the United States will be sold with the receivers by the end of 2006. General Motors and Honda Motor offer XM receivers as factory installations.
"Satellite radio will be a standard feature on all cars in the United States in the coming years," XM Satellite's chief executive, Hugh Panero, said in an interview.
Sirius has exclusive installation agreements with Ford, DaimlerChrysler and BMW.
Shares of XM Satellite rose $2.41, to close at $30.45. Sirius shares rose 14 cents, to $5.42.
Hyundai buyers will get the radio service free for 90 days, Mr. Patterson of XM said. The receiver combines AM, FM and XM Satellite bands, he said.
Hyundai Motor sells about 400,000 cars annually in the United States, Ms. Horace said.
XM Satellite has more than 3.2 million subscribers to its service, while Sirius has 1.2 million.
================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu
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