Slow Car Sales Mean More Bad News for Satellite Radio
It is hard to believe, but then again it isn’t. It appears that once again car sales are down. In most years, the entry of Fall means that there are car deals everywhere as dealerships try to sell off the remaining this year's models to make room for next year's. This year, the situation differed greatly. Auto makers have cut production, closed plants, and have inventory that simply does not warrant a huge sale. The customers that do come to shop are having an increasingly difficult time getting their financing, and thus many are simply opting to hold onto their existing wheels.
For satellite radio watchers, the slumping car sales is simply another negative piece of news on the stock. Yes, the penetration rate of installations is increasing, but month after month sales continue to decline. Because the OEM channel is the subscriber driver for SDARS, there is a direct correlation between auto sales and the number of subscribers announced in any given quarter. Poor auto sales means fewer subscribers trying out the product.
On the positive side, self pay churn for satellite radio has been stable throughout these tougher economic times. People are feeling financial strain, but they seem to be maintaining satellite radio subscriptions at a pace that equates to past experiences.
While not all manufacturers have given numbers as yet, a few have:
Nissan (NSANY) - Down 37%
Ford (F) - Down 35%
Toyota (TM) - Down 32%
Honda (HMC) - Down 24%
GM (GM) - Down 16%
With disappointing numbers well into the double digits, it is little surprise that the overall perception of the economy is not good. In the near term, the auto sector may not see a decent recovery until 2009, and even then, it is a question of how long that recovery will take. Satellite radios will continue to be installed, and subscribers will continue to sign up, but the rate is slowing, and the situation with new car sales does not help matters.
Sirius Buzz will publish our monthly sales report as soon as all data is available.
Position - Long SIRI, No Position OEMs
Related Articles
|
This article has 43 comments:
- User 273334
- 1 Comment
Oct 01 05:43 PM- muley101
- 188 Comments
Oct 01 05:44 PMI really hope you guys took my advice in the previous article and sold SIRI and bought NCC. SIRI is going nowhere for the next 6 months. There is a real downside potential of loss of revenue from current $20 subscribers downgrading to a la carte programming at $6. And an equity offering will dillute shares further.
NCC is on a rocket. It went from 2.05 to a high of 3.14, just as I said it would do 2 days ago. It is now at 2.78 in after hours and is still a screaming buy. I am up 185% on NCC in 2 days. One more day and I cover all my SIRI losses. I think it goes past 3.50 tomorrow. Get in while you can. Then come back to SIRI later and double up at the end of the year if there is some good news by then, which I doubt.
- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 06:04 PMI left you a comment on the other page....
You don't know what the outcome will be tonight.
- rsquared
- 7 Comments
Oct 01 06:05 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 06:06 PM- muley101
- 188 Comments
Oct 01 06:13 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 06:14 PMARMOR FOR SLEEP ~~~
From the song ~~~~ End Of The World (You guys should listen to it)
I wanna stay at home for the end of the world
Falling asleep when they're dropping the bomb.
This is all a dream,
That's what I'll be singing.
1.) First line is when SIRI announces the refinance, It will be the end of the world for the people who abandoned ship. I'll be home for that!
2.) Second line is explaining how I will be falling asleep easily when Captain Mel drops that bomb.
3.) This will be a dream come true.
4.) All this is what ill be singing!
Great song, the rest of it's good to you guys should take a listen
- siriuslysucks
- 10 Comments
Oct 01 06:17 PMBoth Tyler and Brandon have been slightly negative lately and the Street dot com is positive? WTF? Lol.
- muley101
- 188 Comments
Oct 01 06:17 PMwww.metacafe.com/watch.../
- Come on Guys Lets get Sirius!
- 58 Comments
Oct 01 06:18 PMiF YOU already have a subscription to sirius then omit this..
EVERYONE JUST BUY A SUB TO SIRIUS! THEY HAVE CHEAP PACKAGES OUT NOW!! HELP THEIR SUB COUNT! TELL ALL YOUR FRIENDS ADVERTISE FOR THEM! IM DOWN 60K IN THIS SIRI SHITTY STOCK! iM HOPIN IT WILL GO UP! DO WHAT YOU CAN TO RECOVER YOUR LOSS!
- Come on Guys Lets get Sirius!
- 58 Comments
Oct 01 06:20 PMiF YOU already have a subscription to sirius then omit this..
EVERYONE JUST BUY A SUB TO SIRIUS! THEY HAVE CHEAP PACKAGES OUT NOW!! HELP THEIR SUB COUNT! TELL ALL YOUR FRIENDS ADVERTISE FOR THEM! IM DOWN 60K IN THIS SIRI SHITTY STOCK! iM HOPIN IT WILL GO UP! DO WHAT YOU CAN TO RECOVER YOUR LOSS!
- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 06:21 PMwell
CITI and Barclays both upgraded their outlooks for SIRI.
And plus SIRI doesn't have the entire weight of the Financial market on it.
So good thing you jumped ship into that incredibly volatile market.
SWEET!
I'm Praying for you on that vote today man..... Good LUCK
- muley101
- 188 Comments
Oct 01 06:27 PMLook, the subscription downgrades to $6 a la carte could kill SIRI for the next 2 years. Isn't that what you would do if you were not a stockholder?
- Come on Guys Lets get Sirius!
- 58 Comments
Oct 01 06:29 PM- muley101
- 188 Comments
Oct 01 06:30 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 06:32 PMThen go to the NCC posts and write your super comments there bud....
- cos1000
- 1090 Comments
Oct 01 06:42 PM- bdp
- 83 Comments
Oct 01 06:47 PM- ARI D K
- 59 Comments
Oct 01 06:48 PM- cos1000
- 1090 Comments
Oct 01 06:52 PMI watched level ll trading between 10 & 11:15 am. and couldn't believe how big blocks from Arca and Cinn were capping prices at whole cent increments. They hit the board and were gone whenever they needed to keep the stock trading between .61 and .66 all through the morning. They big blocks were there like road blocks to what was available to the bid and just in front / below the ask. It was and has been amazing to watch. The interesting thing is the blocks were there on the downside today too.
- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 07:22 PM- cos1000
- 1090 Comments
Oct 01 07:23 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 07:30 PMBut do you think you can comment on my last comment please man...
- cos1000
- 1090 Comments
Oct 01 07:32 PM- cos1000
- 1090 Comments
Oct 01 07:41 PM- jayk1312
- 3 Comments
Oct 01 07:51 PMFor those folks, does it matter what the monthly rate is...why not give them 3 free months for a years sub?
There has to be a ton of these radios out there, both in cars, in drawers, sitting on a shelf...heck they are next to nothing on ebay. Why not tap that?
- cos1000
- 1090 Comments
Oct 01 08:28 PM- cos1000
- 1090 Comments
Oct 01 08:37 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 08:52 PMThanks for the insight cos
- Come on Guys Lets get Sirius!
- 58 Comments
Oct 01 09:28 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 09:54 PMMidas well start wiping our asses with dollar bills because that's all our money will be worth....
woot
- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 09:59 PM- killerkaul
- 626 Comments
Oct 01 10:06 PM- muley101
- 188 Comments
Oct 01 10:29 PMI tried to help you guys because I helped put you in this hole with 6 articles praising SIRI on SA. I am a believer in SIRI long term and will be back when the price is right. I dumped 28,400 shares of SIRI to buy14,400 NCC at 1.50. It's now at 3.10 in after hours trading. I'm up 23 K now with more to come tomorrow. And the Senate passed that lousy bill. See my article at:
seekingalpha.com/artic...
Senator Shelby's office called me to clarify that he was not the sponsor of the bill. Seems he has had a lot of calls about that article and has even quoted from it on TV.
NCC should rocket tomorrow. SIRI should go up too. I don't mean to rub it in , as the Vicar would, but I will recover all of my SIRI losses in 4 days.
I'll be out of NCC on Thursday because I would not hold it on Friday or Monday , when the Feds takover banks.
- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 10:47 PMYou seem like you know whats going on more than I do, along with cos, 16388, killer, sl62, relmor, and the rest i forgot....
Do you guys think this bill will affect the chances of SIRI refinancing??
If so when ?
- muley101
- 188 Comments
Oct 01 10:54 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 11:01 PM- muley101
- 188 Comments
Oct 01 11:33 PM- Well This Might Be SIRIUS?
- 413 Comments
Oct 01 11:39 PMOk, well that sounds about right....
Thanks
- muley101
- 188 Comments
Oct 01 11:40 PMPlan B: The Mortgage Investment Bill
for Reviving the Economy
by Stan Muse
The Federal Reserve is out of Federal Funds rate options and now the Congress is about to pass legislation which will be the largest bailout bill in the history of the world. Fannie Mae and Freddie Mac are now penny stocks with perhaps over 1000 bank failures yet to come. The American taxpayer will be told that they and their children will be writing big checks to rescue the Wall Street crooks and congressmen that caused all the problems, while receiving nothing in return.
Anyone who has been following recent congressional hearings knows by now that this is unacceptable to Main Street, the voters who will be firing their congressmen for turning the USA into a socialist country. It is also widely believed that this bailout bill may not be embraced by Wall Street because of its onerous terms even if passed. Finally, it will not provide sufficient liquidity for improving the rest of the economy.
A much more effective and fairer way to end our economic crisis is easily attainable. To state it simply, all Congress has to do is to pass a Mortgage Investment bill which allows individuals a one-time option to use some of the funds in their IRAs to pay off their mortgage balance in full, without any penalty, interest, or taxes for doing so. In return, individuals choosing to exercise this option give up their mortgage interest tax deduction for life. This bill could be passed quickly and independently of any other economy-related legislation currently being debated, or included in the current bill. Individuals choosing this option would need sufficient IRA funds to pay mortgage balance in full. The actual payment to the individual’s mortgage company would be done by the IRA managing institution to avoid fraud.
As one senator recently stated, ‘for most people their home is their IRA’. For many others, their 401-K plans hold many trillions of dollars, much of which by now is parked in money market funds or T-bills as mine is. If these IRA funds could be released to pay off mortgages, we could possibly avert, or at least significantly shorten, the economic recession we now find ourselves in. In fact, no other bailout legislation may even be necessary, although more regulatory legislation is certainly needed.
I asked Allan Meltzer, Arthur Segel, and Ellen Zentner to review this proposal and received some positive responses. Ellen said it seemed to be fool-proof and better than a reverse mortgage. In fact, it is a no-brainer for the homeowner with a large 401-K balance, and for the government. The only people who might object, as Ellen stated, are the bankers who want to keep homeowners dependant on them, especially those in the upper-income group. But even the bankers can not want the government to own a large stake in their business for a multitude of reasons.
It makes sense to allow people to use their IRA money, which they earned, to invest in the best and safest investment they could ever make, their home. Presumably they will need a place to live in retirement on a fixed income. It makes no sense for someone with more than enough IRA funds to cover their mortgage balance to loose their home because they lost their job and can not pay their mortgage. It also makes sense because it is not some form of government bailout which rewards the bad behavior of mortgage companies and unqualified borrowers. Instead, it rewards the good behavior of those who have saved and invested in the economy
If only 5 million people chose this option, for an average of only $200,000 each, the result would be $1 Trillion in paid-off mortgages, providing liquidity to the mortgage industry. By executing the option, an individual’s annual mortgage payment would become disposable income to put back into the economy or back into IRA accounts. To the individual, the effect is the same as lowering taxes. If only 5 Million people were able to put back $20,000 per year into the economy, the result would be a $100 Billion per year stimulus package for many years to come.
In my case, with $800K in IRAs and a secure pension, I would increase disposable income by $1600 per month while reducing the IRA balance by only $160K, but saving over $120K in future interest payments. I could retire, which I can not afford to now, and leave my six figure job to someone else. I could also quickly replenish the IRA money used to pay off my mortgage with the extra income.
Adding a further provision to delay receiving Social Security payments for a year in order to exercise the option would be a baby step towards privatization of Social Security. Anyone financially able to exercise the option should be able to delay the payments. For every 5 million people choosing the option, approximately $100 Billion would remain in the Social Security fund. This could fix our problems with Social Security for good.
Some of the benefits of this plan would be to:
• Immediately increase an individual’s or married couple’s disposable income by tens of thousands of dollars each year while enabling them to become debt free, helping families to stay together
• Save homeowners hundreds of thousands of dollars in mortgage interest payments
• Encourage individual IRA savings by many who have never saved
• Allow many people to retire earlier than they otherwise could
• Create demand for housing, reducing inventory, and stopping t