Dutch GPS firm TomTom to cut 10 per cent of its workforce

Dutch firm TomTom NV yesterday said that it will cut 10 per cent of its workforce as part of its €50 million ($69 million) cost-cutting drive as the navigation equipment maker tries to cope with a changing market.

The company, which has over 3,500 employees, will be reducing its headcount by 457, half of which would be through redundancies, while the remaining through natural attrition. Most of the job cuts would be in the Netherlands, said the Amsterdam-based company in a statement.

The company will book a restructuring charge of €14 million in Q4 2011 in relation to the redundancies and rationalisation of office space.

Founded in 1991, TomTom is the world's leading supplier of in-car location and navigation products and services and sells its products in more than 40 countries.

Global Positioning System (GPS) based navigation devices are increasingly becoming must-have gadgets for car owners, cyclists and even runners, and industry watchers had earlier predicted that personal navigation devices (PNDs) would become more popular in the future.

But more than half of TomTom's sales are derived from PNDs built into car dashboards, but today people prefer navigation apps on their smartphones with GPS capabilities.