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Sep 7, 2007

Lower Cost to Drive Demand for Auto Navigation Systems

Lower cost and a desire by auto makers to stand out in a crowded market will increase demand for GPS-equipped, factory installed navigation devices in North America. That is the conclusion of a new study released today by Research and Markets. "Strong growth in the North American automotive navigation systems market is primarily due to a reduction in the cost of navigation systems, aggressive marketing strategies adopted by automakers, and increasing consumer awareness," the market research firm concluded.

In 2006, only about 60% of the light vehicle models sold in North America offered navigation as an option. However, the Dublin-based research firm predicts that number will rise significantly in the future. As the cost of navigation devices has declined, automakers in North America increasingly see them as a cheap way to differentiate their models from competitors. Increasing consumer awareness of such devices also will play a role in the inclusion of the devices as standard equipment in more models.

Like almost all technologies, the cost is expected to continue to decline as economies of scale lower manufacturing costs. The report also forecast lower subscription fees for such features as real-time traffic. Research and Markets predicts that 79% of consumers will be willing to pay for real-time traffic information services.

At the same time, cellphone makers are scrambling to add location aware features to their devices as a way of selling additional services and build customer loyalty. So the first question is where will the public want their maps? In their car, or in their pocket?

The second question is what effect this will have on makers of stand alone devices such as Garmin and TomTom. Many consumers may find that with GPS navigation available both in the car and on their phone, they have no need for another.

Based in Dublin, Research and Markets has published over 80,000 publications on international and regional markets, key industries, companies, new products, and the latest trends.

See also:
So Long to Stand-Alone GPS Units?
Continued Growth in GPS Forecast

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