Car Manufacturers Facing Challenge As Portable Navigation Market Booms

  • SBD report calls for auto industry action to capitalise on consumer demand

In the past decade, navigation systems have moved from being expensive, niche products to mass-market items stocked on supermarket shelves. As consumers have become more sophisticated in their understanding of electronic gadgets, the market for portable navigation equipment has soared. Independent telematics specialist SBD Ltd predicts the European market will top six million units in 2005.

SBD has published a new report analysing the market and technical trends and forecasting continued growth. But as sales of portable systems soar, SBD emphasises the need for car manufacturers to change their approach if they are to increase the number of vehicles sold with embedded, factory-fitted satellite navigation units.

SBD’s research shows that at present only around 10 per cent of new cars in Europe are sold with satellite navigation. Customer take-up is low, given that the equipment is typically offered as a relatively high cost option, or provided as standard principally on premium or luxury grade models. If present trends continue, fitment rates could reach a modest 12 per cent in 2006.

It contrasts this with the performance of portable systems, which have doubled sales levels in 2004-2005. Rapid growth has been fuelled by the success of new personal navigation devices (PNDs), which are smartly designed, simple to use and competitively priced. The portable market also includes personal digital assistants (PDAs) and newly introduced ‘Smart Phones’. SBD’s report anticipates PNDs will claim more than 50 per cent of the European portable market, as more new products reach stores and prices continue to fall.

Although the competition is strong, SBD believes vehicle manufacturers have the opportunity to capitalise on consumer awareness to give new impetus to the market for embedded navigation systems. David McClure, SBD head of Telematics, said: "If car makers are willing to adopt more cohesive marketing and technical strategies, we think there is an opportunity for fitment rates on new cars to rise as high as 30 per cent by 2008-2009.

"Manufacturers have an opportunity to turn increased customer awareness into increased sales of embedded systems, but it requires a fresh approach, both in the way they position the equipment within their model ranges and the way it is sold to the customer on the showroom floor," said McClure.

Key steps recommended by SBD include the provision of simple turn-by-turn navigation systems integrated as standard features within grade structures for both volume and premium models and improved training for car dealers on the advantages and benefits of embedded navigation equipment.

16 August 2005 Staff
 

The information contained this motoring news article may have changed since publication. Product specifications, reviews and editorial may only apply to the UK market. You may wish to check with the manufacturer before making a purchasing decision. E.&.O.E. You may NOT reproduce our motoring news in full or part, in any format without our written permission. carpages.co.uk © 2017