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Kenwood: Garmin Alliance Bears Fruit

7/24/2008 11:48:00 AM Eastern

New York — Kenwood said its alliance with Garmin has helped it gain the top slot in in-dash navigation dollar sales during the first quarter.

The dollar sales were reported by The NPD Group.

Kenwood told reporters at a news conference yesterday that its May-July promotion with Garmin, which touted Kenwood’s in-dash navigation units running Garmin software, resulted in sales of 18,000 navigation units in 75 days. The promotion included radio spots and print ads with dealer tags. Kenwood consumer electronics senior VP Keith Lehmann said Kenwood’s partnership with Garmin is exclusive within the aftermarket.

Lehmann also presented data showing that navigation (including portable GPS) is one of the only growth categories in car stereo. When combined with mobile video, the sector represents 60 percent of total aftermarket dollar sales and 50 percent of the volume.

Total non-navigation autosound sales fell 19.3 percent from June 2007 through May 2008 in retail dollar sales, according to NPD, said Kenwood.

CD receiver sales fell 23.6 percent, amplifiers by 23.3 percent and mobile multimedia declined by 21.6 percent.

Kenwood noted that some retailers have been able to expand business by pursuing expediter sales to local car dealers, with some creating 20 percent to 50 percent additional business.

Kenwood said its current strategy is to offer more promotions with Garmin, and it is pursuing the emerging market of digital TV in the car.

Just as in the home market, TVs in RVs and SUVs will go dark in February next year. Kenwood is pursuing products using MPH TV, a digital standard for TV with reception at speeds of up to 140 mph that is also supported by LG and recently Samsung. The company showed a prototype MPH car TV at International CES and plans to offer commercial products by 2010. An MPH standard is being fast-tracked by the Advanced Television Systems Committee, with the support of 800 broadcasters, and is expected to be approved in 2009, said Kenwood.

Lehmann also acknowledged the merger of Kenwood and JVC but could not comment on the effects it will have on JVC Mobile and Kenwood USA. As of Oct. 1, the domestic Kenwood and JVC companies will cease to trade on the Japanese market and will be replaced by JVC Kenwood Holdings. Executives at the parent companies will also be integrated at that time. 

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