By Nick Flaherty www.flaherty.co.uk
In a surprise move, the European arm of tyre maker Bridgestone is to buy the telematics business of satnav maker Tomtom for €910 million in cash.
The telematics business was seen as a key area for growth for Tomtom with the growth of the Internet of THings (IoT) and connected vehicles. TomTom Telematics is a leading provider of technology to fleets, handling over 800m GPS data points every day from over 860,000 vehicles making 3.3 million trip and sending 200 million inbound messages.
Tomtom will use the money to focus on its map business.
The new combination will allow Bridgestone to cross-sell tyres to a larger customer base but the value is that the data access will enhance Bridgestone’s virtual tyre development and testing as well as connected tyre innovation benefiting all customers including OEMs.
Bridgestone sees mobile digital tech for fleets of vehicles as a strategic priority. This is reinforced by the growing importance of fleets over individually-owned vehicles for transportation of people and goods. Increasing demand in the transportation industry means that fleet owners and managers need to maximise productivity and minimise total cost of ownership more than ever.
This latest investment builds on previous work at Bridgestone to strengthen its digital capabilities in Europe, building capabilities in data collection from sensors, data platforms and analytics. This has resulted in the launch of a range of digital solutions and applications such as Tirematics, Mobox, FleetPulse and Bridgestone Connect.
TomTom Telematics has an installed user base of 860,000 vehicles of which more than two thirds are commercial, managed by the WebFleet and NextFleet platforms. Its strong underlying technologies based on data analytics rely on an open, scalable, secure and cloud-based platform.
The platform enables customers such as commercial fleets, leasing companies or corporate fleets to make their operations more efficient. It also enables partnerships such as with OEMs because of the improved driver experience.
Bridgestone brings its R&D and Rome-based Digital Garage dedicated to the development of digital mobility solutions.
“We have found our perfect match in TomTom Telematics. Our complementary assets and capabilities will create a fleet solutions powerhouse and will further strengthen Bridgestone’s digital technology arm. Beyond scale, there would be considerable benefits by complementing our offerings, allowing us, among many other opportunities, to sell tyres and solutions across our customers. We are now well-positioned in EMEA to accelerate our data-driven business, expand our fleet customer base and seize fast-growing, profitable opportunities in the automotive mobility industry,” said Paolo Ferrari, CEO and President of Bridgestone EMEA and Executive Vice President of Bridgestone Group
“After a thorough review of multiple strategic options, we have determined that the sale of TomTom Telematics to Bridgestone is in the best interest of both TomTom Telematics and our core location technology business,” said Harold Goddijn, CEO of TomTom. “We will continue to invest in our innovative map-making system, enabling faster map updates while lowering operational costs, paving the road towards autonomous driving.”
The transaction is anticipated to be completed latest in the second quarter of 2019.