Harman sees partner in Apple, not rival: CEO

Wed Jun 13, 2012 3:43pm EDT

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(Reuters) - Harman International Industries Inc said it will not be affected by Apple Inc's plans to offer voice activated real-time traffic updates and turn-by-turn navigation in cars.

"A car has a seven-year life cycle while a phone lasts for 14 months or 18 months, so no car would integrate a complete phone-based application," Chief Executive Dinesh Paliwal told Reuters.

He said luxury cars — a market that Harman mainly caters to — will always come with embedded infotainment systems, which can then be paired with smartphones.

Harman shares lost 9 percent of their value over the two days since Apple made its announcement on Monday as investors feared that the technology giant's entry would be disruptive to the car electronics and navigation market.

Paliwal said Harman would integrate the new features Apple announced in its systems but would need about a year to have the product tested so that it did not interfere with any car safety or engine related software.

The CEO noted that Harman had been working with Apple for the last two years and was in the process of launching its first factory-installed car infotainment system with BMW AG that integrates Apple's iPhone.

Apple is working with several automakers, including Audi, BMW AG, General Motors, Honda Motor Co, Mercedes and Toyota Motor Corp, to introduce its voice navigation system.

Paliwal said Harman's offering for BMW already includes integration of Siri, Apple's popular voice-enabled personal assistant software that is at the heart of the phone maker's new navigation system.

The CEO said he was agnostic to which smartphone platform is used to interface with his infotainment systems as Harman will provide support to Google Inc's Android, Nokia, RIM's BlackBerry and Apple.

IHS iSuppli projects the market for auto infotainment technology, which includes everything from navigation and audio systems to screens and chips, to surge to $33.5 billion this year.

Harman, one of the largest car infotainment companies, forecast full-year 2012 sales of $4.2 billion to $4.4 billion.

The company, co-founded by stereo magnate Sidney Harman, competes with Bose, Panasonic Corp, Sony Corp and Denso Corp.

Shares of the company, which counts Volkswagen AG's Audi and Daimler's Mercedes as customers, were down 2.5 percent at $35.63 in afternoon trade on Wednesday on the New York Stock Exchange.

(Reporting by Supantha Mukherjee in Bangalore; Editing by Saumyadeb Chakrabarty)

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