• by Erik Sass , February 1, 2007

The country's largest satellite radio company scored a small coup Wednesday with the announcement that it is extending its partnership with Toyota another seven years, to 2017. This news came a day after the company also extended its agreement with Honda to 2016. The partnerships are especially important for XM because a recent slowing of satellite radio retail sales means that deals with automakers are now one of satellite radio's main growth areas.

Overall, XM has deals with automakers responsible for 59% of total U.S. car production, including GM. Competitor Sirius has struck deals with the other 41%. XM claims that a high percentage of new vehicle owners stick with satellite radio: after three months of free subscription, 52% of car buyers choose to pay to renew the subscription, according to the company. However, the percentage of buyers who opt for the three-month trial subscription in the first place is less than half: of about 2.5 million vehicles to be manufactured in 2007, Toyota expects to install XM radios in about 1 million of them.

The rate of growth in XM's satellite subscriptions slowed over the course of 2006 compared to 2005. XM added a total of 1.7 million subscribers in 2006, compared to 2.7 million in 2005 and 1.8 million in 2004. Meanwhile, rival Sirius signed up 2.7 million new subscribers in 2006, compared to 2.1 million in 2005 and 882,000 in 2004. Overall, XM is still larger, with 7.6 million subscribers versus Sirius' 6 million.