A recent report from IMS Research's Automotive Electronics Group forecasts a continuing trend toward in-car CD players that can play MP3, WMA and WAV music files. MP3 is currently the most common compression format, according to research manager Jon Cropley.
“Users can store up to six times more tracks (with compressed audio) than on a conventional CD, so there is less need for a CD autochanger. Users can also construct their own music selections on a PC before 'ripping' them to CD, and can label tracks electronically so information about them is shown on the head unit’s display,” Cropley said.
The costs associated with enabling in-car CD players to play back compressed audio have fallen dramatically in recent years and the feature is becoming more common in new vehicles. Pricing (around $1,000) and other issues must be resolved before hard disk drives go mainstream, according to the report, "The World Market for In-Car Audio, Infotainment & Driver Information Systems," thus compressed audio will be the alternative playback mode of choice in the short and medium term.