Navigation Market Update: PND Still the Most Dominant Market Segment Globally

Published: 10 Apr 2008

By Praveen Chandrasekar, Industry Manager, Telematics and Infotainment

Introduction – New Growth Markets are Emerging

The global navigation systems marketplace has witnessed yet another year, where portable navigation systems (PND) has emerged as the most dominant product segment. Astronominical growth rates compared to 2006 in the United States coupled with a stable European market have seen the sales volumes of the PND market touching close to 25 million units in 2007 in these two regions. Garmin emerged as the market leader in the PND segment globally with sales of 9.8 million in 2007. TomTom is still the reigning leader in the PND segment in Europe with close to a 50 per cent market share, but in the explosively growing US PND market, Garmin has over 50 per cent market share, which has aided it in reaching the top spot globally.

Much of this domination from the PND segment was made possible only through rapid price erosions with the average selling price (ASP) falling way below €200 in Europe. Suppliers like TomTom ended 2007 with ASP for its PNDs for the year at €170. Even though the volume growth is healthy for the market, the rapid price erosions are intensifying the competition in this market. Only the superior brands like TomTom, Garmin, Magellan, Mio and few others have been successfully able to thrive in this market whilst smaller brands like Cobra and ViaMichelin exited this market in 2007.

On the other end, the market also witnessed booming activities from the mobile phone-based navigation space. Though largely on-board, off board navigation is quietly emerging in the market and witnessing good uptake rates. Many innovations like advertisement-funded free navigation service have emerged in the market. The year 2007 also witnessed a flurry of activities in the LBS space with features like local search, social networking and off board navigation gaining momentum in the market. However, in essence, the prices for mobile phone navigation solutions also dropped to as low as €50 in the European market.

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