Suppliers Trimming CD Receiver Lines For 2007

By Amy Gilroy On Dec 4 2006 - 8:00am

Several suppliers will narrow their CD player lineups for 2007 to reflect the general decline in sales of CD receivers, and they will also continue to lower prices.

Alpine, Panasonic and Kenwood will cut back on the number of SKUs they offer next year, they said, and Audiobahn will cease offering head units next year, following similar actions taken by Rockford Fosgate and New Zealand-based Fusion.

"It only makes business sense to become more targeted with the products and more efficient with fewer models," said Alpine marketing VP Steve Witt.

The NPD Group, based in Port Washington, N.Y., estimates year-to-date sales of single CD players through September have declined 16.4 percent in dollars and 15.3 percent in unit sales to consumers, compared with the period last year.

Panasonic also said it will cut back on CD receiver SKUs while Kenwood said it will do so, "but not radically," according to consumer electronics senior VP Keith Lehmann.

In addition, suppliers continue to target lower CD receiver prices.

Kenwood's Excelon line will start at $179 in 2007, down from $229 this year. "We're looking to hit major prices, in a way, that I think, we've never done before. As a premier brand, we'll be more expensive than second- and third-tier brands, but we have to play by the rules of the game and so do our dealers," said Lehmann.

Panasonic said it will focus on price points "where there is the most penetration, sub-$179," according to mobile entertainment director Rob Lopez. The company will also add front-panel aux in jacks to more units, joining Kenwood and Sony which announced similar models starting at $80.

By contrast, Pioneer said its head-unit lineup will remain constant in number of units. Pioneer also plans to return core car audio to the limelight after placing a heavy focus on in-dash navigation. "Last year we had a stronger focus on navigation. This year, it will be more balanced," said marketing and product planning VP Larry Rougas, adding, "We're going to shift our advertising campaign and marketing strategy to show that Pioneer is about entertaining."

Volume Change
1/06-9/06 vs. 1/05-9/05
Unit Volume% Change
Single CD-15.3%
Car CD Changers-38.4%
Dollar Volume% Change
Single CD-16.4%
Car CD Changers-38.6%
Source: The NPD Group ©TWICE 2006

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