The market for global positioning system (GPS) devices will continue to grow in 2006, although the rate of increase will be slower than last year, according to industry analysts.

"Vehicle navigation is the key growth driver," said Dora Tu, an analyst with MasterLink Securities, who predicts year-on-year growth of 50 per cent in Europe and 30 per cent globally, down from triple digit growth last year.

Over 100 million handheld GPS products were shipped worldwide in 2005, according to recent estimates from Taiwan's Industrial Technology Research Institute.

The record growth in the GPS market last year attracted many new entrants. The number of vendors showing GPS products at the annual Consumer Electronics Show jumped about 40 per cent this year, to over 110, according to US-based Telematics Research Group. The larger part of that increase is accounted for by vehicle navigation systems.

GPS products provide the position of the user anywhere on the planet accurate to within a few metres. Although standalone products are still popular, GPS is more commonly built into mobile phones, PDAs or car navigation systems.

GPS relies on signals from US satellites. Europe and Russia are working on similar systems, and plan to have them launched and operational by the end of the decade.