Garmin, the largest GPS device provider for the North America market, has seen significant volatility in the consumer demand for its products in the eBay USA market. During the third quarter, the volume of sold GPS device units decreased dramatically as Garmin held prices steady. By the end of the fourth quarter, volume took a sudden upswing in time for the previous advertised Black Friday discounts.

Whether or not demand on eBay USA decreased due to the maintained pre-discount prices is unclear. An isolated look at traded new GPS devices correlates to the observed demand for all traded GPS devices. As prices held steady, the decline continued until Black Friday had passed.

Gross sales on eBay USA during these mentioned time periods seem to indicate that ecommerce became preferred venue of trade for GPS devices when economic difficulties hit and Garmin discounted its prices. It is possible this will continue to be the case. As a country with the largest car ownership rates in the world, GPS devices have potential in the retail market for a population that is likely to use them for the purpose of planning more fuel efficient routes. Further more, if the US dollar continues increasing in value, it is possible eBay USA will see a decrease in foreign buyers who find the product relatively more expensive than before.

Until then, online demand and real world demand appear to have been decoupled. As virtual demand decreased during this year’s third quarter, Garmin’s total revenue increased from the third quarter of 2007. Although retail sales are a significant part of its profit margins, this growth also came from an increased share in the aviation and auto sectors.

In the eBay USA market, Garmin has consistently outsold other top brands such as TomTom and Magellan by as much as four times and eight times the amount respectively. Garmin is currently at the head of the pack. When the fourth quarter results are released on the 22nd February, we will discover whether it holds onto its position.