A Deeper Look at Sirius XM's Used Car Deal With GM

From Spencer Osborne, siriusbuzz.com

The announcement made by Sirius XM Satellite Radio is likely much bigger than their headline indicates, and much bigger than many investors even realize.This is not a “Certified Pre-Owned” deal, nor is it relegated to one brand. What Sirius XM announced this week was that more than 1,000 General Motors dealers will offer a three month promotional subscription on ANY satellite radio equipped used car sold REGARDLESS of brand.

One chief complaint of satellite radio investors for years has been finding a way to monetize the inactive radios already in cars, but no longer part of the subscription base. Deals giving certified pre-owned (CPO) buyers a promotional subscription have been in place for quite some time, but most used cars sold are not CPO cars. Thus, while there was a benefit to the company, Sirius XM was not seeing a massive influx of promotional subscriptions.

In a press release issued today the company stated:

Sirius XM Radio today announced that customers will automatically receive a 3-month subscription to SiriusXM when they purchase a pre-owned vehicle factory installed with satellite radio, regardless of manufacturer, from over 1,000 participating GM dealerships across the United States.

For the first time, participating GM dealers will provide customers purchasing non-GM pre-owned vehicles a 3-month subscription to SiriusXM. Customers purchasing Sirius or XM satellite radio-equipped pre-owned vehicles will have access to commercial-free music, and premier sports, news, talk, comedy and a selection of premium programming.

 

This new type of deal will add a whole new dynamic to the Sirius XM subscriber picture. The used car market is HUGE, and there are millions of satellite radio equipped cars that are potential subscribers.

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