DETROIT -- More than 2 million General Motors products will come with factory-installed navigation systems by 2007.
GM will seek to broaden the market for navigation systems through its OnStar telematics network. GM will offer OnStar's Turn-by-Turn Navigation system as a cheaper alternative to systems that use an embedded screen in a vehicle. With the OnStar system, a customer talks to a live adviser.
GM will offer its system as a $100 option during the first year of service on a majority of GM vehicles, OnStar President Chet Huber said in an interview with Automotive News. The service will be free for the first year on most Buick and Cadillac vehicles.
After that, customers will pay $299 a year for the navigation system along with OnStar standard services. If a consumer does not want to renew the Turn-by-Turn, it's $199 a year for OnStar standard service.
Huber said a customer can choose to renew the navigation option each month.
"It's a terrific way to bring navigation services to the broadest market," Huber said. "It seems to be a highly valued system among consumers. The fact that people are willing to spend an additional $2,000 on an embedded-screen system today indicates our feature should help sell cars."
After talking to a consumer, an OnStar adviser sends step-by-step directions to the customer's vehicle through OnStar. The car digitally records the step-by-step instructions, and the audio directions are played automatically through the vehicle's stereo as needed, triggered by the OnStar system's global positioning satellite capabilities.
"It can take you around the city or from coast-to-coast," Huber said.
He said demand for in-vehicle navigation systems is rising. In 2005, 1.2 million model year vehicles were quipped with factory-installed navigation systems, according to a J.D. Power and Associates estimate. That's a 41 percent increase over the 2004 model year, Huber said.
GM installed the navigation technology on some 2006 models at the end of the model year, he said. By 2008, all GM vehicles will have the technology.
"The beauty of this execution is that the actual vehicle piece cost to execute this strategy is zero," Huber said. "So there's no additional hardware cost to these vehicles."
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