SatWaves: A Look At The Automotive Landscape
June 12, 2009 at 5:32 AM (PT)
With the GM and CHRYSLER bankruptcies, there are more questions than answers for SIRIUS XM RADIO. SATWAVES.COM writes, "There can be no doubt that SIRIUS XM will sustain a hit in both their promotional subscriber count as well as a financial one resulting from less CHRYSLER vehicles being produced at the factory level in Q2. There seems however to be an uptick in sales from GM in the quarter, which could help to offset some of those losses. Still, fewer cars and trucks produced at these factories translates into the benefit of reduced SAC, the effects of which are positive to the company’s EBITDA growth projections.
"SIRIUS XM investors may recall that during the first-quarter press conference, it was announced that the GM contract had been renegotiated, with terms being described only as much more beneficial to SIRIUS XM and its stakeholders.
"Another factor that may come into play is that TOYOTA has ramped up its offerings of satellite radio. As of this month, TOYOTA has begun featuring satellite radio in the CAMRY, the #1 selling car in the UNITED STATES.
"Finally, we cannot overlook the new Certified Pre-Owned Programs that were announced last quarter, or new ones that were pending. Is it enough to offset the current OEM difficulties at GM and CHRYSLER? It just may be. Unfortunately, all of this data leaves WALL STREET analysts who are worth their salt in a quandary, which may explain the lack of coverage from some of the bigger names on the street. Analysts appear to be waiting for confirmed data before making recommendations."