Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from the line of Robert Peck.
Robert Peck - Bear Stearns
Hi everybody. I just want to dig a little further on some of the conversion rates stuff. First of all, could you talk about a little bit more on what's actually driving the dip in the conversion rate, and sort of what portion of it is a function of just further penetration in models in cars across the various lines? And when do you sort of see that stabilizing? And maybe Joe you could sort of address the last part of this question, which is, what level can this sort of trend to you over time; how far can it dip down and still have XM fully funded?
Nate Davis
This is Nate Davis speaking. Hi, Robert. First of all conversion rates, as we talked about we think it will stay in slightly above 50% range, and I think we have to keep in mind that the changes here, the fluctuations we've seen have been between 52.5 and 51.5 or 53 or so and 52. So we are not seeing a dramatic dip; we are not happy with the number going down, rather it’ll go up. But remember that we are not seeing a 10 point drop here. We're just seeing a couple of point fluctuation.
We do have a number of programs that we focus on. Since this is primarily GM and Honda, we have some dealer level incentives and improvement programs that we feel are with the dealers. GM and Honda have agreed to do some promotions with us, and we think that overtime these promotions will all make a difference.
We can't predict they will impact us in the next 30 or 60 or 90 days, but we do think overtime these will start to make a difference. So I don't think we've seen a dramatic drop, but I think what we are really seeing here is the fluctuation; when do we think the penetration levels, how will that impact it?
First of all Hyundai is a manufacturer that is most aggressive in getting it in all of the cars. They've been very, very cooperative with us in working on it, and some of the early data we've seen says that that it's not going to -- we're not going to see a drop in what we call post-trial retention just based on the penetration levels.
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