By Demian Russian
Sirius XM Radio (NASDAQ:SIRI) CEO Mel Karmazin stated during the company’s last quarterly conference call that the consensus for 2012 total U.S light vehicle sales was $13.7 million and that the expected year-over-year growth of 8% provided a “solid foundation for subscriber growth this year.” While offering up full-year 2012 net new subscriber guidance of only 1.3 million, which comes in below the 1.7 million net new subscribers the company was able to generate last year and even below the 1.4 million the company was able to garner in 2010, Karmazin even added that he was “very optimistic about our ability to grow subscribers” and that he expected a “bigger contribution from the reactivation of radios in used cars” this year. With so much optimism, why guide for only 1.3 million net subscriber adds? Karmazin explained that management’s 2012 full-year subscriber guidance was “tempered by our sense of conservatism around the price increase we implemented January 1st, 2012.” That being said, Karmazin did add, “We will update our guidance, if appropriate, as the year progresses.”
In light of a strengthening auto sales channel, it may become more “appropriate” to raise subscriber guidance.
According to TrueCar’s official April 2012 sales and incentives forecast released this morning, April will show the highest unit sales since 2008 and the highest SAAR (Seasonally Adjusted Annualized Rate) since 2007. TrueCar is expecting new light vehicle sales in the U.S. (including fleet) to be 1,195,809 units, up 3.4% year-over-year and down 14.8% from a very strong March (on an unadjusted basis). This forecast translates into a SAAR (Seasonally Adjusted Annualized Rate) of 14.6 million new car sales, up year-over-year from 13.2 million in April 2011 and up month-over-month from 14.4 million in March 2012.
The momentum built by the recovering economy and compelling product choices in the first quarter continued to fuel new vehicle sales in April. Consumer demand for the smaller, fuel-efficient vehicles remain strong while the SUV and truck categories are not seeing any dramatic drop in sales — thanks to the introduction of several new models that offer significantly better fuel economy.
– Jesse Toprak, Vice President of Market Intelligence for TrueCar.com
Retail sales are up 6.7% year-over-year from April 2011 and down 9.5 month-over-month from March 2012. Fleet and rental sales are expected to make up 18 percent of total industry sales for the month of April 2012. The industry average incentive spending per unit will be approximately $2,446, which represents a moth-over-month decrease of 4.7% from March 2012 and a 5.6% increase from April 2011.
Toyota has fully recovered from inventory shortages caused by last year’s earthquake and tsunami and have recouped most of their lost market share in April. The automaker will post their highest market share since December 2010 led by sales of fuel efficient vehicles like the Camry, Prius, and Corolla.
– Kristen Andersson, Senior Analyst at TrueCar.com
Used car sales, including sales from franchise dealerships, independent dealerships and private party sales are estimated to be 3,615,148, down 2.0% month-over-month from April 2011, but up 33.6.% month-over-month from March 2012. The ratio of new to used is estimated to be 1:3 for April 2012.
Disclosure: Long SIRI
Contact the author: DemianRussian@SatelliteRadioPlayground.com