Bosch Upbeat on TomTom as Nokia’s HERE Goes Elsewhere

Burney Simpson

The recent sale of Nokia’s HERE mapping division has the autonomous driving industry looking at other mapping firms, primarily TomTom, the Amsterdam-based provider of personal location and navigation systems.

TomTom’s (TOM2.AS) stock price has more than doubled in the last 52 weeks as interest in the mapping space ballooned after Nokia put HERE on the market.

A consortium of the three big German vehicle OEMs – Audi, BMW, and Daimler – bought HERE for $3.1 billion this month.

TomTom added fuel to the driverless fire in July when it reported it had expanding its partnership with Stuttgart, Germany-based engineering giant Robert Bosch to strengthen its high-definition mapping product. Bosch writes the specs for the maps while TomTom creates the maps.

“By the end of 2015 we want to have new high-precision maps for automated driving for all freeways and freeway-like roads in Germany,” said TomTom’s Vice President of Automotive Operations Jan Maarten de Vries, according to Reuters.

The two began collaborating on Bosch’s Advanced Driver Assistance System (ADAS) last year. Under the expanded deal the two plan to complete map coverage of Germany by the end of 2015, then create maps for the rest of Europe along with North America.

Bosch and TomTom said their maps have precision down to 10 centimeters, compared with 10 to 20 centimeters for HERE.

Bosch believes that its ADAS products could bring sales of $1.1 billion as soon as 2016. Privately-held Bosch reported 2014 revenues of nearly $54 billion.

Vehicles equipped with driverless technology require high-speed, high-tech maps to operate on roads and instantaneously react to changing driving conditions.

While GPS systems provide point-to-point information, driverless maps must display a vehicle’s place in a lane, the vehicles around it, road infrastructure like traffic lights, and myriad other details that drivers now take into account as they control their car.

A MIXED QUARTER

TomTom had some good news to report as it released its second quarter results in July. It renewed and extended a global agreement to provide Apple with maps and other services, and it announced its telematics service had surpassed 500,000 subscribers, a 28 percent increase from a year ago.

However, the quarterly numbers were mixed. TomTom reported revenues of $287 million, a five percent rise compared with second quarter 2014, but profits tanked more than 70 percent to $2.7 million. Its automotive division scored second quarter 2015 revenues of nearly $29 million, down 15 percent from a year ago.

The firm said it expected to complete by the end of 2015 a remake of its mapping system that will better position it to serve the automated driving industry.

TomTom has been moving into the driverless sector but it lags HERE, whose maps are used in 80 percent of in-vehicle navigation systems in the U.S. and Europe (See “Will Nokia’s HERE Map the Future of Driverless Cars?” April 2, 2015).

Rumors swirled that Apple, Uber and China’s Baidu had bid on HERE. Nokia sold HERE to focus on its mobile-phone network equipment. HERE had been a money loser for Nokia since it bought it for $8.1 billion several years ago.