The car stereo industry ended the decade on a down note as the recession and slower car sales added to existing challenges.
The industry, however, took steps to combat the continued slide: the 12-Volt Initiative launched a viral video campaign to raise awareness, and a new group — the Mobile Electronics Specialists of America (MESA) formed to help retailers promote their stores and services.
Suppliers still claimed that future products such as Internet radio solutions, verbal texting technology and driver safety will help fuel sales in the future.
This past year, however, saw wholesale sales to retailers drop by double-digits in all key traditional car stereo categories, with a particularly steep slide in sales of mobile video, caused in part by lower car sales.
Steve Koenig, industry analysis director for the Consumer Electronics Association (CEA), noted, “Autosound has been under some pressure for some time, and the recession has put even more pressure on those categories.”
Total mobile DVD player sales, in particular, fell 80 percent in dollars and 72 percent in units year to date through October, according to the CEA.
Koenig blamed OEM competition as well as competition with portable products such as the iPod and iPhone. “The amount of video content available on those devices [mobile phones] has mushroomed substantially. When you think about families with older kids — they are content to have their wireless phone or iPod — probably more happy with a device that they can hold in their hand.”
The CEA believes that Mobile DTV — a new free, live rugged ATSC TV service that works even in a fast-moving vehicle — will present an opportunity for the 12-volt market in the future. “That, coupled with a video source unit from BluRay or DVD content, might be a little more compelling,” said Koenig.
The CEA estimated in-dash CD player sales fell 12 percent in dollars and 18 percent in units year to date, compared with last year. Fixed in-car navigation dollar sales saw the lowest decline, at 9 percent in dollars, while unit sales for the category fell 18 percent.
Retailer sales to consumers were not as dire as the wholesale figures. Total mobile audio, including portable GPS sales, slid 8 percent in units and 19 percent in dollars. Mobile video actually rose in unit sales by 5 percent, but it declined 13 percent in dollars. In-dash players fell 19 percent in units and 17 percent in dollars.
Audiovox Electronics president Tom Malone, speaking of the growing popularity of devices such as smartphones, as well as Internet hot spots, said, “The technology on the handset side has moved so quickly and the vehicle side has not kept up. So there will be a scramble to make products to satisfy consumer needs: text messaging is next. You're going to see families of products in new categories over the next couple of years. We're in that valley right now.