Premium Audio systems can offer some of the most interesting data analysis opportunities across all vehicle features.
In MY2020 alone, we tracked over 3.75 million Branded Audio systems shipped on vehicles in the US market (either as standard or optional). This penetration rate represents a large consumer demand for these systems and demonstrates the benefits of these cross-industry collaborations for OEMs. Premium Audio itself is an important feature for automakers that increases the appeal of their cars. Furthermore, the options they have in choosing and integrating it drives up incremental revenues.
Within automotive, Premium Audio operates as a feature that allows, and often promotes, third-party branding. This provides suppliers with the opportunity to associate their brand with the car and, more importantly, the customer experience. Likewise, carmakers can use Premium Audio to leverage the popularity of these brands to boost the appeal of their vehicles even further.
By examining the market dynamics between these suppliers and their partner OEMs, we have outlined the scale of the relationships between them. For MY2020 vehicles, we tracked 16 brands who supplied their systems to car makers across the globe. We found that Bose is the largest individual brand, shipping approximately 1.4 Million units, while Harman is the largest supplier overall – shipping approximately 2 Million units to a plethora of carmakers with examples including RAM, Subaru, and BMW.
Over time, through to today, the market has been dominated by established players (such as Harman and Bose). However, by plotting out the changing relationships between Premium Audio brands and car manufacturers, we have identified other supplier profiles:
The first of these are the wind-down suppliers. This category includes brands such as Pioneer that had one or two OEM clients but have since lost them to the leading suppliers.
Leading suppliers, such as Harman and Bose, can be identified by their significant, sustained, stakes in the market.
Boutique suppliers denote the brands (including Kicker and Burmester) that have been able to retain a small number of OEM relationships over the years.
Newbie suppliers are brands who currently have a foothold in consumer electronics, such as Beats and Sonos (beginning FY2022), that are presently entering the market. They are looking to utilize their popularity among younger drivers to win OEM business.
To categorize these, we analyzed brand presence over OEMs across the last eight years. The results can be viewed in the chart below.
Since 2013, there has been significant market consolidation. Several participants have departed the space, with much of this leftover business picked up by leading suppliers. However, in both the last MY and the next MY, we expect to see a moderate resurgence of newbie brands.
In the coming months, we will continue to track the changing landscape within Premium Audio. We will also provide deeper insights into its pricing and functionality trends. In the meantime, if you have any questions about the above insights, please let us know.