Speaking at the UBS Global Media & Communications Conference on Wednesday, XM Satellite Radio's Chairman of the Board, Gary Parsons, said that the shift to an OEM driven model occured "faster than expected" this year.
Back in May, XM cited an "overall softness in retail" - something that we apparently have been seeing industry-wide when compared year-over-year. Still, Parson said that XM is "not going to chase the retail market" for growth at any cost.
He mentioned that while GM has increased OEM penetration to 1.8 Million vehicles for 2007, GM will actually represent a lower percentage of XM-installed vehicles in 2007. This is because their other OEM partners are stepping up production at an even faster rate than GM is.
When asked whether XM will going into the Telematics market considering their relatively recent foray into Navigation and Weather systems, Gary Parsons said that he "would not go into specifics" over future Telematic services. He did point out that GM has OnStar which currently is the largest player in Telematics, but that it was "no mistake" that Honda and Acura were the first to offer XM NavTraffic.
When asked what keeps him up at night, Parsons responded that the retail softness is "concerning" but in his opinion could be "largely cyclical" in nature. There's still a market for retail, and will always be a market in retail.
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