Car MP3 Players Continue To Ring Up Hot Sales
By Amy Gilroy -- TWICE, 12/18/2000
MP3 is expected to be a hot category for 2001, with leading suppliers expected to add one or two flagship models to their new lineups.
The few suppliers offering MP3 this year-including Aiwa, Kenwood and Rockford Fosgate-reported very brisk sales, and some said they immediately sold through year-2000 shipments.
Aiwa said it breezed through more than 10,000 units in two and a half months.
Kenwood VP Bob Law said his company's Z919 AM/FM/CD with MP3 capability, at a pricey $650, has continued to "oversell supply" since it was launched in April.
With new MP3 models due next year, Kenwood is sticking to the CD vs. flash memory format, Law said. "We've shown a prototype flash piece, and we license memory stick and Sandisk. But our feeling is the flash memory cards are still a little pricey for the market. Memory stick starts at $89, and you can buy a blank CDR for $2.50."
Law admits he was caught by surprise by the demand for MP3, "especially given the price point of the Z919. But we're not surprised by the demand for MP3 in general. We believe that it will be a very important selling feature for the car."
Retailers, too, claim the format is gaining popularity with car audio's core 18- to 24-year-old male demographic. "We're getting 10 inquiries a day for CD players that will play CDRs and MP3. But most of the calls are about MP3," said Joe Cavanaugh, owner of Stereo West, Omaha, Neb.
At Aiwa, which released its CDC MP3 in August, marketing general manager Eileen Toomey said her company's "experience is the most natural place for kids to take MP3 with them is in the car." She also noted that while the expense of flash memory might be a problem in the portable market, where small size is a necessity, the CDR format (which is far cheaper) works fine in a car environment.
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