Garmin hopes to make stopping to ask for directions a thing of the past. The company manufactures navigation products that use Global Positioning System (GPS) technology to wirelessly deliver geographic location data through satellite communications. Its portable products incorporate electronic maps and navigational charts. Garmin also makes communications devices that combine cellular and GPS technology. Manufacturers such as Bombardier, Toyota, and Viking Yacht incorporate Garmin equipment into its products. The company sells its consumer products through retailers including Best Buy, Halfords, and Wal-Mart, as well as through distributors and independent dealers. Nearly half of sales come from outside the Americas.
Garmin enjoys the pole position in North America, but it has had to slipstream TomTom in Europe, where that competitor enjoys a nearly 50% market share. To try to reroute some of that business to its own coffers, in 2010 Garmin changed its country of incorporation from the Cayman Islands to Switzerland. It believes the move will allow it to more easily partner with or acquire industry players in the region.
While sales in Europe and most other eastern hemisphere regions have risen steadily over the past three years, the Americas have continued to decline during that period. Market saturation and competing technologies have been a drain on its largest segment, automotive/mobile. Its sales fell another 5% in 2011, bringing its percentage of total sales down from 70% in 2009 to less than 60% in 2011. Revenues from the Americas dropped 7%, while Europe, Middle East, and Africa (EMEA) rose nearly 20%, and Asia/Pacific improved by 13%.
Offsetting automotive/mobile's struggles, all other product segments kept growing. The company's third largest segment, fitness (approaching 15% of sales) outperformed all others, climbing nearly 25%. Outdoor sales expanded by 14%, marine floated up by 12%, while aviation ascended nearly 10%. All those gains were enough to turn its overall revenues in a positive direction in 2011 after two years of a toppling top line. Fitness product sales were invigorated by new products and continued expansion globally. Outdoor revenue also benefitted from new products, as well as a bigger share of the golf market. Market share gains also helped the marine segment, and new panel-mount products were the wind beneath the aviation segment's wings. The company's top ten customers account for around one-third of sales.
Some of those new products came via acquisitions, something which has played an important role in helping Garmin expand its products and meet demand internationally. In 2011 Garmin expanded in South America with the acquisition of Centro GPS (now Garmin Chile), which distributes Garmin's automotive, outdoor, fitness, and marine products; and it bought Garmin Distribution Africa (now Garmin Southern Africa) the same year, in order to firm up its ties to retailers in that region.
Also in 2011 Garmin acquired Tri-Tronics, a leading designer and maker of electronic dog training equipment, to fortify its kennel of products for tracking and training pets and sporting dogs. Finally, it bought German portable navigation device maker Navigon (now Garmin Würzburg) that year to improve its position in the market for automotive navigation systems in Europe and to add navigation software for mobile phones to its product line.
In 2010 Garmin bought MetriGear, adding a pedal-based power meter that uses force and motion sensors to independently measure the pedal force for each leg. Also that year, the company bought Belanor, the company's distributor in Norway, to solidify its presence in the country.
More recently, in 2012 the company agreed to purchase Interphase Technologies, a privately held maker of marine products based on phased array scanning sonar technology. The acquisition will expand Garmin's portfolio of marine products with technology that provides an underwater image of the area ahead of the watercraft. Interphase is one of the only manufacturers of forward-looking sonar technology, which increases boating safety in poor weather and uncharted waters. Interphase will become a subsidiary of Garmin, operating as Garmin Santa Cruz. Also that year Garmin acquired Sweden-based Nexus Marine, which served the sailing and yachting market.
Chairman and CEO Min Kao owns nearly a quarter of Garmin.