GM to expand its OnStar communications service into six new markets

Article by Christian Andrei, on September 17, 2010

To appeal to those seeking technology and safety features in their new cars, General Motors Co. plans to expand its OnStar communications service into six new markets, including Brazil and Europe. Chris Preuss, OnStar's president, said that OnStar wishes to add subscribers in Mexico, South Korea, the Middle East and Australia to build on its fast growth in China.

OnStar, which provides accident alerts, directions and vehicle diagnostics, has about 5.7 million subscribers in the US, Canada and China.

It’s no surprise that GM, which is currently managed by former telecommunications and technology executives, is prioritizing being able to sell OnStar to consumers.

In particular, these managers include CEO Dan Akerson and former CEO Ed Whitacre, who have headed telecommunications companies, and Chief Financial Officer Chris Liddell, who worked at Microsoft Corp.

Preuss said that the managers think that OnStar has a “great brand presence” but “maybe atrophied a little bit in its marketing approach.” He anticipates that telematics space will be a highly competitive segment.

In 1996, OnStar made its debut in the US and Canada. The service is currently free in more than 30 models for the first year, then offered on a subscription basis for $199 to $299 annually depending on the level of service.

Preuss asserted that 5% to 7% of GM customers claim that they purchased their vehicle “for no other reason than they had to have OnStar.” [via autonews - sub. required]

Topics: gm, onstar

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