Navigation service provider TomTom recorded red numbers in the books last year. TomTom was troubled by fewer cars being sold, causing automakers using the company’s systems to renegotiate the price of their contracts. The corona crisis was also noticeable in the department that makes software for fleet management. In the coming year TomTom foresees another major loss due to investments in the map platform.
TomTom’s turnover in 2021 amounted to €507 million. That is lower than the €528 million from a year earlier. TomTom did manage to keep the loss under control. This year TomTom had to write €95 million, a year earlier the loss was €257.6 million. At that time TomTom spent a lot more money on research and development, especially in the field of geographic data.
For the coming year, TomTom is counting on a lower production of cars and the corresponding lower price that car manufacturers are willing to pay the company for its navigation software. Yet TomTom does not have to be shy about orders, because the order book is well filled with €1.9 billion in orders. This is partly due to a deal with Volkswagen, which TomTom pays to provide a navigation service aimed at electric vehicles.
In the best-case scenario, turnover this year will be at a comparable level to 2021. TomTom does expect red numbers again, because the company wants to invest more in automating the platform to make maps and to layer it with extra data. . This should ultimately lead to greater efficiency. From 2023, TomTom will be more positive: by then the problems in the car sector will probably be solved and the company can earn more again, it is expected.
– Thanks for information from Autoweek.nl