The potential tariffs imposed by Donald Trump on automakers are causing SiriusXM to consider the potential effects on attracting new car owners as satellite radio subscribers.
Currently, it’s uncertain where that might end up. Initially, we had a robust start for two months, but there’s a possibility that upcoming tariffs could affect our automotive division of the business,” Jennifer Witz stated at the Morgan Stanley Technology, Media & Telecom Conference on Wednesday.
On Wednesday, a temporary waiver of one-month’s worth of tariffs for American automakers was declared. However, Trump’s tariffs, along with the countermeasures taken by Canada and Mexico, may increase the cost of purchasing new cars significantly. This could potentially affect SiriusXM negatively.
Witz mentioned that a major satellite radio company predicted relatively steady automobile sales at the start of the year. However, these predictions were affected when Trump announced a 25% import tariff on both Canada and Mexico earlier this week. These countries play crucial roles in the transnational production chain for American-made cars.
Witz mentioned that while the ad industry at SiriusXM isn’t immediately threatened by tariffs, they are considering potential effects from a less stable US economy on consumer trust and inflation rates. In simpler terms, she described the current US advertising climate as ‘rough waters’, given its ongoing influence from international political and economic conflicts.
For the initial two months of the year, things remained relatively steady. However, over the past few days, there’s been a significant increase in uncertainty, stock market turbulence, and potential issues such as inflation or stagflation. These trends seem to be affecting retail and consumer packaging industries,” Witz pointed out.
As a fan, I must say, there are numerous aspects we can influence for growth, while navigating through some turbulence. The ongoing tariff situation is just one of them. Interestingly, our strategy now leans towards prioritizing in-vehicle subscribers and gradually shifting away from high-cost streaming customers outside the car.
In simpler terms, “Witz informed investors that we didn’t observe an increase in individual streaming subscriptions and have adjusted our marketing budget accordingly.” Additionally, he discussed Howard Stern, whose contract with SiriusXM ends in 2025, and there have been rumors of his potential retirement.
Today, there’s no particular update, but we’re always delighted to have Howard on our platform. We hope our partnership continues as long as he wishes to be on air. He joined us way back in 2006 and has consistently delivered an enjoyable listening experience for our audience. He forms a vital part of our programming.” – Witz shared.
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2025-03-05 22:54