Big Harman contract hints at consolidation of suppliers
DETROIT -- General Motors has relied on multiple hardware suppliers for its vehicle infotainment systems for its four North American brands. But that may be changing.
GM recently signed a $900 million contract for infotainment hardware with audio systems maker Harman International Industries. Harman CEO Dinesh Paliwal told analysts in a conference call this month that the contract, the company's first with GM in at least 20 years, was to provide infotainment systems across "multiple models."
The systems would be launched in late 2014, Paliwal said in an interview with MarketWatch, a business news Web site owned by News Corp.
GM uses several suppliers to provide the touch screens for its various offerings. Panasonic Corp., for example, supplies them for Buick's sedans as well as the Chevrolet Malibu, Cruze, Equinox and Volt. The units for the MyLink system in the Chevy Spark and Sonic are made by LG Electronics of South Korea.
A GM spokesman says the company uses other infotainment suppliers, too. He declined to comment on the Harman contract and whether it would consolidate several other suppliers' contracts. But, he says, "As time goes on, we'll find ways to leverage the volume and take advantage of our size."
In an Aug. 10 press release, Harman said its GM contract will "replace a competitive system." A Panasonic spokesman declined to comment. LG didn't reply to requests for comment.
Harman supplies infotainment technology to BMW AG, Honda Motor Co. and other automakers. Its Aha Radio product, for example, aggregates online content from tens of thousands of sources, such as music services, travel sites and Facebook, and organizes it under one interface.
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