Tomtom fires every 10th employee – the reasons
After Klarna, now Tomtom: the Dutch navigation specialist is laying off 10 percent of its employees.
In a press release, Tomtom almost casually mentioned in a single sentence that the Dutch navigation specialist is laying off 10 percent of its employees worldwide ( only a few days ago Klarna also laid off 10 percent of its employees worldwide ). That sentence reads, “Unfortunately, this will impact approximately 500 employees in our cards department, which is approximately 10% of our total global workforce.”
Tomtom calls this reason
In the rest of the press release, Tomtom avoids words like “layoffs” or “job cuts” and only speaks of an improvement in map generation technology and a reorientation. However, Tomtom does give a reason for the layoffs: “Technical investments have led to an advanced automated map creation platform that has resulted in a significant change in map creation activities.” And further: “A higher level of automation and the integration of a variety of digital sources will result in fresher and richer maps with greater coverage. These better maps will enhance our product offering and allow us to target a broader market, both automotive and corporate .”
Then comes the crucial sentence: “Improving our map-making technology will result in significant efficiency gains.” In other words, Tomtom doesn’t need as many people to create its maps as it used to and is laying off employees accordingly.
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According to Reuters, analysts suspect that lower-paid employees in particular will have to leave the company.
Possible other reasons
In fact, however, completely different reasons are likely to play a role in this massive job cuts. Because the time of stand-alone navigation devices is coming to an end. Hardly anyone buys these devices, also known as PND. Increasingly powerful smartphones with ever better navigation apps such as Google Maps ( detailed test ) are increasingly pushing classic navigation devices out of the market. Especially since every smartphone is more responsive and powerful than a PND in a direct comparison, as our test shows again and again: Tomtom Go Camper in an endurance test.
Of course, the permanent installations in the vehicles ex works are an exception to the drop in sales figures. But if Tomtom customers like VW or Renault are able to deliver fewer cars because of their delivery problems, that also affects Tomtom. Likewise, delivery bottlenecks in the Tomtom chips could complicate their own production. The FAZ points this out.
Incidentally, Tomtom also offers navigation apps, some of which are even chargeable. We present the Tomtom apps here: These Tomtom navigation apps are available – free, paid, advantages and disadvantages.
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