This is kind of an interesting rumor: Apple is said to be developing a GPS navigation system for Mercedes cars. Now why Apple would want to build a navigation system isn’t clear, unless it’s part of a larger car entertainment management system… Think about it, what if Apple had a system where you could sync your iPod, your iPhone, maybe a MacBook with a system built-in to your car? That would be pretty cool in my book.

In my opinion, the car is very under-utilized as a potential hub of your digital lifestyle. Plenty of people spend a lot of time in their cars, yet while there is a major push to bring full-computing to the living room, the move to bring it to cars is half-assed at best. Sure you can’t exactly surf the web while driving, but if technologies like WiMax ever gain enough traction, how about listening to Internet radio, getting live-map GPS updates, downloading new music and podcasts, and checking your email on the GPS screen while stopped on a long road trip?

Apple would be an ideal company to get in early on such integration – they have already on a smaller scale with almost all cars now having options for iPod connections. Syncing your iPhone with your car is the next step, then GPS-based syncing (assuming iPhone 2.0 supports GPS), then the Internet.

I’m probably reading too much into this rumor, but it’s an interesting thought.