Replica maker Corgi might seem an unlikely candidate to cash in on the iPod boom. Until recently, Corgi has made a name for itself mostly to collectors, who for 50 years have snapped up its small die-cast Batmobiles, World War II planes, and British omnibuses. The outfit's best-known model is the Aston Martin DB5 that Sean Connery drove in 1964's Goldfinger -- featuring front-mounted machine guns and the famous ejector seat. And while Corgi has lately expanded its toy line, baby boomers still account for the bulk of its loyal fans.
But this summer, Corgi (CRGI) will go after a younger, hipper crowd with a product called the iCar. Mounted on a stand, it consists of "dancing" iPod speakers shaped like an automobile. Plug any MP3 player into the die-cast iCar, and see the vehicle spin its wheels, lift and lower its front and rear suspension, and shine its headlights in rhythm to the music. Corgi is hoping this combination of the popular iPod and a hot ride will prove a hit with consumers ages 18 to 40, and lay the groundwork for a major shift in the company's direction over the next half-century.
The device, due out in July, already has captured the attention of major retailers. That's no small feat, considering that some 10,000 new iPod cases, skins, speakers, and other accessories from such heavyweights as Apple (AAPL), Bose, and Belkin will trickle onto the market this year. Hundreds of companies are jockeying for a piece of the estimated $5 billion iPod aftermarket, according to the consultancy the Envisioneering Group (see BW Online, 9/5/05, "The iPod: All Decked Out").
It runs in Corgi's favor that iPod speakers in particular have enjoyed healthy sales, says Richard Doherty, director of the Envisioneering Group. Plus, the use of toys as iPod accessories qualifies as a fairly new phenomenon. The toys that have hit the market in the past year have sold well: Hasbro's (HAS) iDog -- a plastic canine that moves its ears and flashes lights to the music streaming from an iPod -- ranked as one of the hottest gifts last Christmas. Hasbro sold some 500,000 units, according to industry sources.
Based on retail orders received so far, Corgi expects the iCar to turn into its biggest single-year seller ever, says David Davenport, general manager of the company's U.S. operations. That means the iCar stands to topple best sellers like Corgi's replica of Greyhound's scenic cruiser.
Picking an auto for the iCar made for a torturous design decision. "For an iPod, you want something sexy," says Davenport. "And a bus isn't sexy." What about the company's Bond car? "Spies are quiet people that work on Her Majesty's behalf. They are not the type to walk around with boom-boom, boom-boom," Davenport jokes. "Besides, if James Bond walked around with headphones in his ears, he'd get shot."
So the iCar will arrive in the form of either a hip Cadillac Escalade SUV (GM) or a sporty Nissan 240SX (NSANY), which has inspired numerous fan clubs and been a favorite in drag-racing circles. The Escalade will come in black or white, and the Nissan will come in a sublime orange. Each model, powered by three AA batteries or a standard electrical cord (neither of them included with the iCar), will likely retail for $30 to $40 -- significantly higher than most of Corgi's die-cast replicas.
Strong sales would be especially good news for Corgi, considering that its die-cast models haven't taken off in the U.S. The company, which originated in Britain but has its headquarters in Hong Kong, entered the U.S. market in 2000. "The U.K. is more of a collector mentality," explains Davenport. "[There], it's more tied to history. In the U.S., what's hot today is dead tomorrow."
Corgi hopes the popularity of the iPod will rub off on the iCar and improve its U.S. business. This year, $4.5 billion worth of MP3 players are expected to fly off shelves, up from $3 billion last year, according to Consumer Electronics Assn. forecasts. If the iCar takes off, Corgi might introduce other iPod accessories, Davenport says. Boombox Bondmobile, anyone?