San Antonio — The Progressive Retailers Organization was at the Westin La Cantera Hill Coun
Less than a year since the first round of aftermarket car locators hit store shelves, the category has endured some technological challenges and false starts. But suppliers continue to predict strong growth.
Approximately 10,000 aftermarket car locators are shipping each month — a figure which is expected to grow by 15 to 20 percent in 2002, according to Rand Mueller, CEO of Code Technologies, the telematics arm of Code-Alarm. "The dealers all report back that it's slow getting started but once [the salesmen] figure it out, the throughput starts to increase. And those dealers are not going away, and we're adding new dealers," Mueller said.
In addition to the aftermarket, approximately 30,000 Lojack locators ship per month, Mueller estimates, and OnStar claims it is currently signing up over 150,000 new subscribers per month. Expecting to reach 4 million subscribers by the end of 2003, from a current 1.7 million, OnStar continues to extend its service to new vehicles, said a spokesman.
But the market is not without its ups and downs. Of the half dozen aftermarket companies that announced car locators this year, few are shipping in the United States. DEI, based inVista, Calif., delayed its entry until 2002. Immobiliser of Houston, Texas, went out of business, according to the Better Business Bureau of Houston. And Autostart, based in Montreal, is shipping in Canada with its U.S. launch expected shortly.
Code Technologies, Madison Heights, Mich., began shipping in March, followed by InterTrack, Frisco, Texas, in April. Audiovox, Hauppauge, N.Y., is planning to introduce a new product in February and LoJack, Westwood, Mass., is developing two new locators, including a unit that offers Internet tracking.
Some industry members say that the market got off to a rocky start because the technology is still new. "It is absolutely taking longer to deploy [car locators] than most marketing companies had anticipated," said William Tsumpes, CEO of Seaguard, a service provider for vehicle and home security which is partnering with DEI.
"Traditionally the problems are with the hardware. Most of the companies attempting to build a GPS system have no previous experience in wireless communications. There are demanding engineering feats required to deal with power conservation in the vehicle. While the average car alarm is drawing 20 milliamps these devices can draw 250 milliamps, so regulating the power consumption down to a level that won't kill the car battery is an issue. It's a complicated learning curve," he said.
Other suppliers said that there are also still glitches in cellular service, and while these are tolerable in normal cellphone use, they may be less tolerable if someone is trying to track their car on the Internet in a potentially life threatening situation.
"The service is continuously improving but its causing some suppliers a bit of angst in terms of jumping in with both feet. Suppliers get into the business and find out customers are not willing to accept it so fast and then they bail out and a new crop comes in. This may be the case for the next 24 to 36 months. But everyone knows it's the future," a supplier said.
Within the next four years, telematics sales, including OEM, could reach $30 billion, according to Peter Fazi, national sales director for AutoStart.
Tsumpes, says, "I believe that the technology will find a surefooted home along with other forms of mobile security.