Car navigation market fell 21 pct in Q3 -Canalys

HELSINKI, Nov 5 (Reuters) - Global market value of car navigation devices fell 21 percent in the third quarter due to sharply falling prices, and the industry is under further pressure from the handset vendors, research firm Canalys said on Wednesday.

All vendors in total sold 8.8 million personal navigation devices (PNDs) in the third quarter, 14 percent more than a year before due to strong demand in North America and Asia.

Garmin (GRMN.O) took back the post of the world's largest PND vendor which it had lost in the previous quarter to TomTom TOM2.As. Garmin held 35 percent of the market, while TomTom held 29 percent.

Last week both firms cut their 2008 forecasts, citing weakening global economies.

Portable navigation devices were one of the fastest-growing consumer electronics categories in recent years, but also have not been tested yet in an economic downturn.

In Europe, Middle East and Asia (EMEA) region sales of PNDs fell 6 percent from the previous quarter, and fell far behind navigation-enabled handsets, which saw sales more than doubling from the previous quarter.

Third-quarter sales of cellphones with built-in navigation technology in EMEA more than doubled from the previous quarter to 10.4 million phones.

"Today, the volume of turn-by-turn navigation solution licences being shipped and activated for smartphones in EMEA is around 11 percent of the GPS smart phone total," said Canalys analyst Chris Jones.

"With GPS being built into the majority of smartphones, and users increasingly being given maps on their phone by default, and multiple reasons to use them, the threat to PND vendors is rising quickly," he said.

Canalys said the world's top cellphone maker Nokia (NOK1V.HE) was the third largest provider of mobile navigation in EMEA, behind TomTom and narrowly behind Garmin.

(Reporting by Tarmo Virki; Editing by Bernard Orr)