“Death” of Car Radio Possible in 10 Years: Study

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A new report by IMS Research finds that aftermarket car radio sales will be cut in half by 2018 globally to $3.2 billion, from $6.1 billion in 2011.  The report asks, “Are vehicle manufacturers causing the death of the traditional aftermarket car radio?”

IMS Car Radio IMS states “new developments from vehicle manufacturers could spell the end of the traditional aftermarket car radio in the next 10 years, especially in mature markets.”

The North American and Western European car radio market will see a decline from $1.7 billion in 2011 to $781 million in 2018. Senior Analyst Jack Bergquist from IMS Research said, “The next three years will be very critical for aftermarket head unit suppliers. The industry is going to see a shift away from high volume/low cost units to low volume/high cost and more advanced units. If manufacturers aren’t able to innovate and assess new markets effectively in this period, future success will be hard to guarantee.”

However, the aftermarket is expected to respond with accessories and kits, said IMS.  “…it’s not all doom and gloom for aftermarket manufacturers.  With new software based head units that are harder to replace becoming more prevalent, new opportunities will open up for accessories or upgrade boxes to increase the hardware capabilities of these existing systems. Also, the existing fraternity of die-hard audiophiles who are willing to invest significantly to create a unique experience in their vehicles is unlikely to disappear in the future.”

IMS Research was recent acquired by IHS Inc.

Source: IMS Research 

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  1. FACT! Broadcast radio is on its way out, just ask any member of the NAB. Amy, the news you provide is spot on and necessary. Anyone who gets mad at you for talking about the facts is just thin skinned or lives in denial. The true future of our industry and the world looks bad from a economic perspective, unemployment, job growth, government debt, personal debt, taxes, over regulation, healthcare, entitlements and on and on and on. If the readers on this site want the facts just keep reading, but if truth and facts scare you I suggest reading the latest from TMZ! The 12volt industry is in total free fall! the race to zero is allmost OVER and the average 20 year old is broke, not just financially but intellectually. The truth is 2012-2013 is going to get bad real bad, the EPA is now implementing the UN’s agenda 21 and with that said say fair well to the remote start business!. Car integration has always been a cat and mouse game the only problem is the mouse is now blind! Geeeee, I hope this was not toooooo negative for the readers!

  2. I just want to know if anyone has really asked headunit manufacturers such as Alpine… why are they making OEM units for the manufacturers but still sending their reps around saying you aren’t buying enough?

    I would like to further state why, again Alpine being used in this scenario, are they making MOST optical amps for the OEM, but have nothing for the aftermarket shops to integrate to them, or replace.

  3. What is your problem Amy Gilroy? Aren’t you employed by the 12v industry? Why are you doing everything you can to illicit fear into the timid 12v retailers?

    How about uplifting articles, not “the sky is falling, 12v is dying, my life is over, iPhone / Android will rule the world, shoot me now” articles.

    Your news is old stuff picked up off the newswire. How about writing something creative from YOUR OWN perspective, not just regurgitated articles.

    My business in 12v is up. Why? because I don’t let your poison rot my brain.

    Thanks for the dose of reality Ray. Perhaps Amy needs to read some history before she does another cut and paste on another piece of junk article.

    I’ll get back to growing my 12v business now. Oh, but it’s dying…..

    1. Thank you for your comment.

      I’m very glad to hear that your store is doing well. CEoutlook runs stories regularly on stores that are also bucking the trend and doing well.

      As for the study I quoted, it was performed by IMS Research, a well respected research firm. So when it says that aftermarket car radio sales will be cut in half by 2018 and questions whether car radios will be around in any significant quantities in 10 years, that is something worth reporting on.

      But the study does not say the aftermarket will die. It says the opposite, that the aftermarket will adapt and produce add-on boxes to radios and it will continue to cater to an enthusiast niche.

      The DIN car radio is clearly changing. See our other story here on the size of car radios shifting. When Sony admits to looking beyond a DIN-sized radio, you can bet the car radio is nearing an inflection point.

      Markets change, and those who adapt, survive. The industry is going to have to produce innovative, well designed add-on products or other workarounds when it comes to the dash as well as innovative radios, as the article states.

  4. OEM Integration is progressing at a rapid pace – I believe it is how you prepare for the future that will give you a better understanding of the Here and Now….for the Future…

  5. Having started in our trade in 1967 I like Ray have seen the industry evolve.For us to survive we will need aftermarket intergration that WORKS !!!!!!! Many suppliers sell equipment that just does not function as advertised and leave retailers to take the heat from the consumer. We cannot constantly try software upgrades to fix problems which should have been resolved before going to market.

  6. Just look at the current vehicles being delivered to the car dealerships. The LCD on many vehicles is the ecosystem for the whole vehicle and can’t be removed. For several years now many of the Nissan/Infiniti vehicles that come with an LCD screen can’t removed. Current Dodge and Chrysler 4.3″ and 8.4″ LCD screens must stay in the vehicle. Anyone checked out the 2013 Impala? It looks like the Cadillac 8.2″ motorized screen. All the current Camry’s come with an LCD screen!!!!! This trend will continue.

    Integration will be the future as the story states!!!!

  7. This topic always evokes a good deal of emotions and rational replies. Indeed I recall an article that I wrote in 1994 talking about the 1983 prediction that aftermarket car audio would be dead by 1987, remember CASA?.

    Certainly the “traditional” (key word in the artricle) radio has and will continue to change… AM to AM/FM to AM/FM with underdash turntable or 4 track or 8 track to AM/FM Cassette to AM/FM Cassette with underdash or two piece 1 DIN CD Player to 1 DIN indash CD player with deployable LCD screen to 2 DIN DVD with Navigation to mech-less to…

    I contend that there will be new technology. There will therefore be new opportunities. Therefore there will be a creative aftermarket (supplier, rep-distributor and retailer) community to create the consumer demand and then meet the consumer demand. It may be for panel speakers in the headliner or talking mirrors that keep the driver awake or an in dash information center that accurately predicts the winner in the next horse race at Aquaduct…?

    The only thing predictable about the death of the aftermarket is that the aftermarket finds new stuff with which to thrive and avoid death.

    Ray Windsor
    German Maestro

  8. I agree with the theory that the aftermarket is going to have to step up and be creative ,as they once were. We have gone through a period that has seen auto manufacturers produce more creative audio systems than the aftermarket. It certainly cannot continue unless the aftermarket again becomes the leader.

  9. so all the brand managers that are not managing and the manufacturers reps that are not repping will realize that they are no longer relevant. look at what a mess most distribution is now.

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