Portable navigation devices (PNDs) will decline in popularity as navigation becomes a standard feature in other devices such as smartphones, according to iSuppli.
In 2007, iSuppli said PNDs accounted for about half of all navigation device shipments, with the remainder divided up among automotive in-dash systems, smart phones and mobile handsets.
But the analyst firm sees continuing decline for PNDs, forecasting around 35 percent market share by 2010.
"PNDs have flourished in an environment with little competition during the last four years," said Richard Robinson, iSuppli principal analyst.
"Being less expensive and easier to obtain than in-dash systems, and much easier to use than mobile handsets, PNDs have been the navigation product of choice for global consumers," he said.
"However, there will be a significant cannibalization of the PND market by low-cost in-vehicle solutions and wireless handsets in the coming years."
By 2011, iSuppli forecasts navigation-enabled mobile handsets to account for 36 percent of total navigation system shipments, for the first time surpassing PNDs as the highest-volume platform.
While the PND market will still generate significant sales opportunities for PND makers and their suppliers over the next few years, the industry is likely to undergo consolidation, with many companies expected to leave the market, according to iSuppli.