GPS Devices

GPS device suppliers in mainland China and Taiwan currently produce over US$1 billion worth of products per year, a figure expected to rise by 133% in 2005.

Now you can profit from such dramatically increased activity in the global positioning system supply market, using this report as your guide.

You will receive profiles of 41 major GPS device manufacturers from the main production centers in the region. Profiles such as these are not available anywhere else.

Plus you'll get a comprehensive industry overview, technology updates, an easy-to-use product comparison table and practical advice to improve your sourcing efforts immediately.

What you'll get

In-depth profiles of 21 leading suppliers, with a detailed look at their production facilities, export capacities, QC procedures and factory expansion plans

Supplier tables for 20 other major manufacturers, featuring key sourcing information including factory locations and sizes, product lines, export capacities, technology partners, and product certifications and approvals

Background information to pre-qualify manufacturers that supply to major buyers such as Dconnex, HP, Nissan, Toyota, Panasonic and Vtech

A special section featuring top-tier South Korean manufacturers, with insights on their new product releases before they hit the market

How you'll benefit

Identify suppliers that rely on subcontracted manufacturing and learn how this affects the quality of the final product you buy

Discover how FOB prices are dropping due to the replacement of imported SiRF chipsets with locally developed products

Identify manufacturers that are increasing their R&D investment and are expanding their export volumes as a result

Understand pricing trends that will impact the way you source your GPS devices for the next 12 months

Executive summary

In-vehicle GPS receivers will drive product development and manufacture in the GPS industry in Taiwan and mainland China. This is one of the main findings of this market intelligence report, which includes in-depth interviews and factory inspections of leading makers in the two markets.

As global demand for GPS devices grows, Asian makers will be expanding production to prepare for it. Taiwan companies will increase their output and expand export business. These suppliers will continue to leverage their technological advantages to stay ahead of the competition.

Mainland China, while behind in terms of product development, has the larger supplier base with about 100 makers compared to 30 in Taiwan. Mainland manufacturers take advantage of the country's manufacturing scale and low costs to offer competitively priced GPS receivers.

In addition to expanding production, the other findings of this report include rising production and export volumes, a preference for subcontracted manufacturing, emerging chipset design capability, decreasing unit FOB prices and improved marketing strategies. Combined export targets of companies surveyed place 2005 GPS shipments at a minimum of 7 million units.

Although Taiwan companies will increase output and exports, there are no plans to depart from their current manufacturing strategy, which is to subcontract most of production to other factories on the island. R&D remains an in-house process, along with assembly, QC and packaging. However, even in-house assembly is not likely to grow, as companies said they prefer expanding their subcontracting network to investing in new workshops or equipment. They will, however, continue to insist on stringent QC measures, even sending their own QC personnel to EMS companies' facilities for in-line inspection.

SiRF chipsets serve as the core solution for most GPS receivers from mainland China and Taiwan. Some companies have started using Sony's newly released single-chip solution. Several Taiwan makers are now adopting locally developed chipsets. This new trend is seen by many as a springboard for the increase in homegrown GPS technologies. This, combined with growing production volumes, will likely push down FOB quotes in 2005. More than half of surveyed companies are projecting price reductions next year.

Combined production from Taiwan and mainland China in 2004 will reach a minimum of 3 million GPS receivers. Aggregated shipments for the same year will hit at least 2.5 million. From these figures, Taiwan is forecast to account for 19.2 percent of the worldwide market.

Industry overview

The worldwide GPS market is forecast to reach a production value of US$21.5 billion in 2008, according to ABI Research. Taiwan's Industrial Economics and Knowledge Center (IEK) expects worldwide GPS shipments to climb from 23.6 million units in 2003 to 30 million units in 2004.

Taiwan grabbed a 12 percent share of unit GPS shipments during 2003, corresponding to a value of US$710 million. The island's share of worldwide unit shipments will rise to 19.2 percent in 2004, and production value will likewise be increasing by 30 percent, to US$923 million.

Mainland China reported total annual sales of US$80 million for 2003. A 25 percent increase is expected in 2004 to push total GPS annual sales to US$100 million. The annual turnover is projected to grow to US$1.2 billion by 2005.

According to the China Technical Application Association, US$966 million of the US$1.2 billion will come from GPS products and software. The remainder will be generated by value-added services.

GPS manufacturing in mainland China is a decade-old industry that started by developing vehicle location and tracking applications. Between 1994 and 1995, more than 100 suppliers, mostly foreign firms or their local agents, joined the sector. The establishment of GSM, and later GPRS, network infrastructures beginning 1998 further spurred growth.

By 2000, there were about 300 vehicle location and tracking networks covering more than 300,000 vehicles nationwide. Estimates place the number of new vehicles being added to the network each year at a minimum of 100,000.

Makers and industry experts expect a new round of developments to occur in 2008, when mainland China hosts the 29th Olympic Games in Beijing. The National Planning Committee has allotted US$120 million as start-up capital for a US$1.2 billion nation-wide GPS project. The Committee expects the GPS sector's annual turnover to be US$1.2 billion by 2010.

Production hubs
Mainland China's GPS industry produces both hardware and software. Hardware consists of receivers in different form factors, most notably in-vehicle and hand-held devices. Software consists of geographic information systems (GIS) and controlling software.

The major sourcing centers for GPS products across mainland China are Beijing, Shanghai, Shaanxi, Sichuan and Guangdong.

Components and parts, such as dielectric filters and antennas, can also be sourced from Zhejiang province.

There are about 100 suppliers scattered across the country. About a quarter of these companies specialize in GIS products. These are mostly small companies with backgrounds in software and system integration. The leading makers in this segment are Beijing Lingtu Software, Wuhan Aofa, Beijing City-on-Map and Beijing Creation.

Several consumer electronics companies, such as Haier, have expressed interest in joining the line. Haier itself has developed what it calls a WebGIS solution.

Leading GPS hardware terminal suppliers are mostly state-owned companies with technical research background.

These companies include Longmarch Hangxin and Cstarcom in Beijing, Yaxon Network in Xiamen, Space Star Technology in Xi'an and Chengdu SIWI Electronic.

Both Shenzhen SEG Scientific Navigations Co. Ltd and Huaqiang Network and Communications in Shenzhen are public-listed companies.

Samples of supplier profile

Beijing Tiantong Advanced Technologies Ltd
Located in Zhongguancun — mainland China's Silicon Valley — Beijing Tiantong Advanced Technologies Ltd takes full advantage of its geographical location by cooperating with the nation's top universities, tech firms and military institutes to develop and manufacture in-car GPS products and handheld PDA receivers. Established in April 2003, Tiantong is a high-tech startup enterprise managed by foreign-trained technicians with more than 10 years of experience in GPS, wireless-data exchange and radio-communication technologies.

The company reported an eight-month turnover of US$240,000, all from GPS systems and terminal products. The domestic market accounted for 100 percent of sales in 2003 with products going to law-enforcement sectors such as the police and the military. The firm has since received inquiries from interested buyers in the United Kingdom and the Middle East, and expects to achieve US$100,000 worth of exports in 2005.

As a new company, Tiantong currently does not have its own factory. Almost all manufacturing is subcontracted to a professional PCB OEM service provider and a military equipment maintenance base, both located in Beijing.

Global Sources visited Tiantong's PCB manufacturing subcontractor, Beijing Huake Electronics Co. Ltd, a firm that used to belong to The Sixth Institute of the country's former Ministry of Electronic Industry. The factory is ISO 9001-certified and is managed in accordance with the 5S management system. The factory takes up the whole fifth floor of a building inside Zhongguancun and occupies an area of 1,000 square meters. The factory floor is packed with production lines and employs more than 200 workers. The components and parts warehouse, the production engineering department and administrative offices surround the production area.

Before entering the factory, the Global Sources team members were asked to wear anti-static shoe covers. The tour started from the SMT workshop, where we saw two production lines, each with Juki surfmounting production machines, purchased in 2003 for US$250,000. Tiantong only subcontracts about 100 units per month.

Outside the SMT room, we saw two soldering production lines and one repair line, each with more than 50 online workers. Further to the right of the factory floor, there are two automatic soldering production lines with Sun East soldering machines. Beside the soldering production lines, there are automatic and manual assembly lines.

Sample of product gallery

Handheld GPS Receivers Company:Cheng Holin Model Name/Number:P-Track Unit FOB Price (US$):280 Minimum order (units):

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