Lured by Taiwan's strong electronic manufacturing capabilities, TomTom NV, the world's biggest maker of portable navigation devices (PND), said yesterday it would set up its Asia-Pacific headquarters in Taiwan as a stepping stone to further expansion in the region.
The Amsterdam-based company made its first step into Asia yesterday by launching its first PND product in Taiwan after gaining strong footholds in Europe and North America.
"TomTom chose Taiwan as its Asia-Pacific headquarters not only because of the low penetration rate and high growth potential of the Taiwanese car navigation industry, but also because of the tremendous PND market potential in Asia," TomTom chief operating officer Alexander Ribbink told a press briefing yesterday in Taipei.
Ribbink forecast TomTom's global shipments this year would rise to 8 million units, which would represent a growth of approximately 70 percent from the 4.7 million units shipped last year.
Taiwan's PND market is still in the nascent stage with a penetration rate of below 5 percent, compared with 10 percent to 15 percent in Europe, Charles Huang (黃昭穎), vice president of TomTom Asia Inc (通騰科技), told reporters.
The Taiwanese market would serve as a testing ground for TomTom's ventures into other Asian countrie, Huang said. No concrete plan has been set for further expansion in the region.
TomTom has successfully differentiated itself from other brands in Europe by providing real time traffic information and other services, said Lucy Ho (何心宇), an analyst with market researcher Market Intelligence Center (資訊市場情報中心) in Taipei.
"But, it would lose such advantages in the Taiwanese market in competing with local brands like Mio," Ho said, adding the market here could take longer to take off.
While domestic sales of PNDs are still low, Taiwanese companies are experiencing substantial growth in making PNDs for other big names such as TomTom, Ho said.
TomTom's plan to set up its regional headquarters in Taiwan may benefit local suppliers, Quanta Computer Inc (廣達) and Inventec Appliances Corp (英華達), Ho said.
This year, local companies led by MiTAC International Corp (神達) are forecast to account for half of the global supply of 17.45 million PNDs and global positioning system phones, Ho predicted, without providing comparative figures.
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