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Thursday, July 13, 2006

TomTom Takes it Back

By William Trent, CFA of Stock Market Beat

Last week we reported on the earnings miss at digital navigation leader TomTom, which the company blamed on logistical issues.

TomTom declined to say which component had caused the problem, but added that it was a logistical mishap that could not be blamed on its Asian contract manufacturer or suppliers.
“We can’t blame any of this on Quanta <>,” TomTom spokesman Taco Titulaer said, referring to its Asian contract manufacturer.

Now the story appears to be shifting.

Quanta Computer will lose its only client in the GPS market, TomTom, because of defects in the navigation devices the notebook maker has made for the Netherlands-based firm, according to the Chinese-language Commercial Times.

Anybody got some juicy low-down on this one? With holiday sales coming and Sony (SNE) and Pioneer joining the GPS fray, could TomTom be in more trouble than they let on?

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