SIRI » Topics » Automakers

These excerpts taken from the SIRI 10-K filed Mar 10, 2009.

Automakers

Our primary means of distributing satellite radios is through the sale and lease of new vehicles. We have agreements with every major automaker — Acura/Honda, Aston Martin, Audi, Automobili Lamborghini, Bentley, BMW, Chrysler, Dodge, Ferrari, Ford, General Motors, Honda, Hyundai, Infiniti/Nissan, Jaguar, Jeep, Kia, Land Rover, Lincoln, Lexus/ Toyota/Scion, Maybach, Mazda, Mercedes-Benz, Mercury, MINI, Mitsubishi, Porsche, Rolls-Royce, Volvo and Volkswagen — to offer either SIRIUS or XM satellite radios as factory or dealer-installed equipment in their vehicles. As of December 31, 2008, satellite radios were available as a factory or dealer-installed option in substantially all vehicle models sold in the United States.

Many automakers include a subscription to our radio service in the sale or lease price of their vehicles. In many cases, we receive subscription payments from automakers in advance of the activation of our service. We share with certain automakers a portion of the revenues we derive from subscribers using vehicles equipped to receive our service. We also reimburse various automakers for certain costs associated with the satellite radios installed in their vehicles, including in certain cases hardware costs, tooling expenses and promotional and advertising expenses.

Automakers

STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%">Our primary means of distributing satellite radios is through the sale and lease of new vehicles. We have agreements with every major automaker —
Acura/Honda, Aston Martin, Audi, Automobili Lamborghini, Bentley, BMW, Chrysler, Dodge, Ferrari, Ford, General Motors, Honda, Hyundai, Infiniti/Nissan, Jaguar, Jeep, Kia, Land Rover, Lincoln, Lexus/ Toyota/Scion, Maybach, Mazda, Mercedes-Benz,
Mercury, MINI, Mitsubishi, Porsche, Rolls-Royce, Volvo and Volkswagen — to offer either SIRIUS or XM satellite radios as factory or dealer-installed equipment in their vehicles. As of December 31, 2008, satellite radios were available as a
factory or dealer-installed option in substantially all vehicle models sold in the United States.

Many automakers include a subscription
to our radio service in the sale or lease price of their vehicles. In many cases, we receive subscription payments from automakers in advance of the activation of our service. We share with certain automakers a portion of the revenues we derive from
subscribers using vehicles equipped to receive our service. We also reimburse various automakers for certain costs associated with the satellite radios installed in their vehicles, including in certain cases hardware costs, tooling expenses and
promotional and advertising expenses.

This excerpt taken from the SIRI 10-K filed Mar 1, 2007.

Automakers

          Various automakers factory-install and dealer-install SIRIUS radios in their vehicles. As of December 31, 2006, SIRIUS radios were available as a factory or dealer-installed option in 132 vehicle models and as a dealer only-installed option in 17 vehicle models. Many automakers include a subscription to our radio service in the sale or lease price of their vehicles. In many cases, we receive subscription payments from automakers in advance of the activation of our service. We share with various automakers a portion of the revenues we derive from subscribers using vehicles equipped to receive our service. We also reimburse various automakers for certain costs associated with the SIRIUS radios installed in their vehicles, including hardware costs, tooling expenses and promotional and advertising expenses.

          Automakers have begun to incorporate SIRIUS into their national and regional advertising. In 2006, DaimlerChrysler and Ford each implemented a national advertising campaign with prominent references to SIRIUS. We expect advertising by automakers to increase as SIRIUS radios become available in a wider array of vehicle models.

          DaimlerChrysler. We have an agreement with DaimlerChrysler Corporation, Mercedes-Benz USA, Inc. and Freightliner LLC, which continues until September 2012. This agreement covers the distribution of our service on an exclusive basis in all cars and light trucks manufactured by DaimlerChrysler and Mercedes-Benz as well as Freightliner and Sterling heavy trucks. We expect DaimlerChrysler to include SIRIUS radios as a factory-installed feature in approximately 40% of its vehicles during the 2007 model year. In addition, Mercedes-Benz has agreed to

6


include SIRIUS radios as standard equipment in all 2007 model year Mercedes SL Class, CL Class, AMG branded and V12 engine vehicles.

          Ford. Our agreement with Ford Motor Company and certain of its affiliates provides for an exclusive relationship until September 2011 or, at Ford’s option, until September 2013. Beginning in January 2009, Ford may elect to become nonexclusive under the agreement, in which case Ford would forfeit its significant future economic benefits. This agreement covers all Ford brands, including Ford, Lincoln, Mercury, Jaguar, Volvo, Land Rover, Aston Martin and Mazda. At the end of 2006, SIRIUS radios were available as a factory-installed option in 19 Ford, Lincoln and Mercury vehicle lines.

          BMW. We have an agreement with BMW of North America which provides for an exclusive relationship until August 2008. This agreement covers all BMW and MINI vehicles.

          Volkswagen and Audi. In March 2006, we entered into a new exclusive agreement with Volkswagen of America, Inc. through July 2012 or, at Volkswagen’s option, through July 2015. This agreement covers all Volkswagen and Audi vehicles.

          Other Automakers. In April 2006, we entered into an exclusive agreement with Kia Motors America, Inc. Kia has agreed to include SIRIUS radios as standard, factory-installed equipment in all of its vehicles commencing in the 2009 model year. Our agreement with Kia extends through 2014 or, at Kia’s option, through 2017.

          We have an agreement with Mitsubishi Motors North America which provides for an exclusive relationship through February 2010.

          In October 2006, we entered into an agreement with Bentley Motors Inc. Bentley will begin including SIRIUS radios as standard, factory-installed equipment in its vehicles commencing in the 2008 model year and continuing through 2012. Each Bentley vehicle equipped with a SIRIUS radio will be sold with a lifetime subscription included in the price of the car.

          We also have an agreement with Rolls-Royce Motor Cars. Rolls-Royce has agreed to include SIRIUS radios as standard, factory-installed equipment in all of its vehicles through 2008. Each Rolls-Royce vehicle will be sold with a lifetime subscription included in the price of the car.

          SIRIUS radios are also available as a factory or dealer-installed option in various vehicle models offered by Nissan, Infiniti, Toyota, Lexus, Scion and Subaru.

This excerpt taken from the SIRI 10-K filed Mar 13, 2006.

Automakers

      Various automakers factory-install and dealer-install SIRIUS radios in their vehicles. As of the end of 2005, SIRIUS radios were available as a factory-installed option in 89 vehicle models and as a dealer-installed option in 19 vehicle models. In 2006, we expect automakers to expand the availability of SIRIUS radios in their vehicles to over 115 factory programs. We expect that the number of dealer only programs will decrease as a result of the increased availability of SIRIUS radios as a factory-installed option.

      In certain cases, automakers include a subscription to our radio service in the sale or lease price of vehicles. The length of these prepaid subscriptions varies, but is typically six months to one year. In many cases, we receive subscription payments from automakers in advance of the activation of our service. We reimburse various automakers for certain costs associated with the SIRIUS radios installed in their vehicles, including hardware costs and tooling expenses. Such costs are expected to decline as the costs of SIRIUS radios decrease.

      

This excerpt taken from the SIRI 10-K filed Mar 16, 2005.

Automakers

      We have programs with various automakers to factory-install and dealer-install SIRIUS radios in their vehicles. In certain of these programs, automakers have agreed to include a SIRIUS radio and a subscription to our service in the sale or lease price of vehicles. The length of these prepaid subscriptions varies, but is typically six months to one year. We receive payment from these automakers for such subscriptions in advance of the activation of our service. In connection with these agreements, we also reimburse automakers for certain costs associated with the SIRIUS radio installed in the applicable vehicle at the time the vehicle is manufactured, including hardware costs and tooling expenses. These subsidies are expected to decline as the costs of chip sets and other hardware associated with SIRIUS radios decrease.

      During 2004, automakers launched 80 individual programs to include SIRIUS radios in their vehicles, including 50 factory-installation programs. In 2005, we expect automakers to expand the availability of SIRIUS radios in their vehicles to an aggregate of over 100 programs, 65 of which are expected to include the factory-installation of SIRIUS radios.

      DaimlerChrysler. We have an agreement with DaimlerChrysler Corporation, Mercedes-Benz USA, Inc. and Freightliner LLC (collectively “DaimlerChrysler”). This agreement covers all cars and light trucks manufactured by DaimlerChrysler as well as Freightliner and Sterling heavy trucks. We share with DaimlerChrysler a portion of the revenues we derive from subscribers using new DaimlerChrysler vehicles equipped to receive our service. We also reimburse DaimlerChrysler for certain advertising, hardware and development expenses incurred by DaimlerChrysler in connection with the installation of SIRIUS radios in DaimlerChrysler vehicles. Our agreement with DaimlerChrysler extends to May 2007.

      DaimlerChrysler offers SIRIUS radios as both a factory-installed and dealer-installed feature. SIRIUS radios are offered as a factory-installed option on thirteen 2005 model year Chrysler, Dodge and Jeep vehicles, all with a one-year subscription to the SIRIUS service included in the price. SIRIUS radios are also available at Chrysler, Dodge and Jeep dealerships across the continental United States on most 2005 model year vehicles. SIRIUS radios are available at Mercedes-Benz dealerships across the continental United States as both a factory-installed and dealer-installed feature. SIRIUS radios are available as a factory-installed and dealer-installed option on seven 2005 model year Mercedes-Benz vehicles, and as a dealer-installed option on two additional 2005 model year Mercedes-Benz vehicles. These installations include at least one year of the SIRIUS service in the price of the vehicle. DaimlerChrysler has announced that it expects to factory equip over 500,000 vehicles with SIRIUS radios in its 2005 model years.

      Ford. We also have an agreement with Ford Motor Company. This agreement covers all Ford brands, including Ford, Lincoln, Mercury, Jaguar, Volvo, Land Rover, Aston Martin and Mazda. We share with Ford a portion of the revenues we derive from subscribers using new Ford vehicles equipped to receive our service. We also reimburse Ford for certain advertising, hardware and

7


development expenses incurred by Ford associated with the introduction of SIRIUS radios in Ford vehicles. Our agreement with Ford extends to September 2008.

      In January 2005, Ford and Lincoln Mercury announced plans to offer SIRIUS radios as a factory-installed option in up to 21 vehicle lines, and announced that they expect to generate up to 1,000,000 SIRIUS subscribers during the 2006 and 2007 model years. A subscripton to at least six months of the SIRIUS service will be included in the price of these vehicles. Ford and Lincoln Mercury offer SIRIUS radios as a dealer-installed option on the 2004 model year Ford Mustang, 2005 model year Ford Thunderbird, Ford Explorer, Ford Sport Trac, Ford Expedition, Ford Crown Vic, Ford Escape, Lincoln Navigator, Lincoln LS, Lincoln Town Car, Lincoln Aviator, Mercury Mountaineer, Mercury Mariner and Mercury Grand Marquis. Mazda offers SIRIUS radios as a dealer-installed option in its Tribute, MPV, Miata, RX-8, MAZDA3 and MAZDA6 vehicles. Volvo offers SIRIUS radios as a dealer-installed option in its 2005 model year S60, V70, S80 and XC70 vehicles.

      BMW. SIRIUS radios are available as a factory-installed option on all BMW 5-Series, 6-Series and 7-Series vehicles, and are expected to be available as a factory-installed option on the 2006 model year BMW 3-Series, with a one-year subscription to the SIRIUS service included in the price of the vehicles. BMW also offers SIRIUS radios as a dealer-installed accessory at BMW centers across the country. BMW vehicles are equipped with in-dash stereos that are compatible with SIRIUS radios. Most MINI cars are also factory equipped with SIRIUS-compatible radios. As part of our agreement with BMW, we share with BMW a portion of the revenues we derive from subscribers using BMW and MINI vehicles equipped to receive our service. In addition, we reimburse BMW for certain promotional, hardware and development expenses incurred by BMW in connection with the installation of SIRIUS radios in BMW vehicles.

      Other Automakers. SIRIUS radios are available as a factory-installed option in the Nissan Pathfinder, Maxima and Quest, and in the Infiniti I35, G35 coupe and sedan, M45, Q45, FX35 and FX45. SIRIUS radios are also available as a dealer-installed option in the Nissan Maxima, Sentra, 350Z coupe, Murano, Quest, Armada and Altima, and in the Infiniti I35, G35 coupe and sedan, M45, Q45, FX35, FX45 and QX56. Infiniti and Nissan also pre-wire all of their vehicles, other than the Nissan Pathfinder, to enable Infiniti and Nissan retailers to install satellite radios.

      SIRIUS radios are available as a factory and dealer-installed option on six 2005 Audi models. Volkswagen offers SIRIUS radios as a factory-installed option in the 2005 model year Beetle and Jetta and we expect SIRIUS radios to be offered on the 2006 model year Passat.

      Beginning in March 2005, we expect Toyota will commence offering SIRIUS radios as both a post-production and dealer-installed option in nine Toyota, Lexus and Scion models. SIRIUS radios are currently available in the Toyota Camry, Toyota Solara (including Solara Convertible), Toyota Land Cruiser, Lexus LS 430, Lexus ES 330, Lexus LX 470, Scion xA, Scion xB and Scion tC.

      SIRIUS radios are also available as a factory-installed option on the 2005 model year Porsche Cayenne.

      We have also entered into an agreement with Mitsubishi Motors North America. Mitsubishi plans to offer SIRIUS radios as a factory-installed option on its new 2006 model year Raider. We also expect that SIRIUS radios will come standard as part of Mitsubishi's premium audio system package, and all 2006 and 2007 model year Mitsubishi vehicles that are equipped with a SIRIUS radio will include a six-month subscription to the SIRIUS service in the price of the vehicle.

      We are in discussions with other automakers to include SIRIUS radios in new cars and trucks.

      Penske. We have an agreement with Penske Automotive Group and United Auto Group, which together own and operate approximately 144 auto dealerships in the United States. Penske Automotive Group and United Auto Group have agreed, where available, to order SIRIUS radios on vehicles they purchase from automakers, and to use best efforts to include a bundled subscription to our service in the sale or lease price of these vehicles.

8


Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki