Usually, people think of blockchain, one of the most buzzing trends of 2018, as a technology that stands behind the advent of all cryptocurrencies, such as Bitcoin and Ethereum. However, in the last couple of months, this technology has presented itself as a source of disruption for various industries. Now it contains much more potential than just financial transactions. In this blog, we will be understanding how blockchain for Automotive can streamline this sector's cumbersome processes and operations.
Although the financial sector has been making exploring the technology for the last few years, blockchain automotive solutions have only begun tapping into this technology for discovering new advantages.
After using blockchain for Automotive, the next change in the use of vehicles will be that they might be able to talk to each other. They will be able to transmit important data about road safety, conditions, and maneuvers. Vehicles will not only be a medium of transportation. Significantly, Blockchain will play a vital role in the further automotive technology revolution.
Automotive companies tend to put money quite often in technology development. As per a report by Sullivan and Frost, a market research company, such companies may spend approx. $169 billion on incorporating new technological advancements by 2025. Also, read why every company will be using Blockchain by 2028. Out of this amount of investment, it's expected that 0.6% investments will be on the Blockchain. So, how can vehicle manufacturers, lenders, resellers, and distributors use Blockchain to their benefit?
There are numerous ways the automotive sector can make use of Blockchain.
Now, read on to know each use case in detail.
When planning to buy a second-hand car, customers usually face the issue of compromised odometer data. We buy a second-hand car and later come to know that it has been driven much more miles than we thought. This is where Blockchain comes into play.
Since blockchain data is unalterable, you can always compare a seller's words with the real information stored on a blockchain network. Not only you will be able to see any information about a car: mileage, repair history, accidents, etc., but will also be able to extract any other data that will help customers to not invest in the wrong purchase.
During 2017, Abu Dhabi officers seized more than 500,000 fake auto spare parts worth of $4 million in a single day. It had taken their whole day to count all fake pieces. Now, it's difficult to imagine how big a market of counterfeit car parts is. According to Nissan's officials, it has lost about $60 million in the Arab Emirates in a year due to fake car parts.
This means that the world requires a convenient countermeasure. Apart from money theft from car manufacturers, as well as the decreased number of jobs and fake parts can also hamper our lives, especially when talking about airbags. Luckily, the blockchain technology is a convenient solution to these issues. By using Radio-Frequency Identification Tags (RFID), car manufacturers will have proof-of-provenance of car parts and track a particular car in the supply chain, while the public ledger will store all the information about a car. Those automotive companies that will integrate Blockchain to prove the provenance of auto parts will be able to considerably lower the expense associated with recall activities.
Blockchain can bring many unexpected benefits to insurance companies. Both the proof-of-provenance concept and Blockchain's immutability factor can help organizations to strengthen their operating activities. When a car insurance company gets fraudulent information through false claims or any other means, the use of smart contracts can help it to validate the information. With Blockchain for Automotive, insurers can even check whether a car required urgent repair before its accident, which could be due to the vehicle's technical complications or verify any other related query asked by the submitter.
As per a report by Reuters, Toyota has partnered with a few technology companies like BigchainDB, MIT, and Oaken Innovations, to develop blockchain-based applications regarding insurance purposes. Therefore, we might be seeing some usage-based blockchain solutions in 2018, from Toyota.
Although Tesla has begun selling its cars that's equipped with a built-in autopilot feature, self-driving cars are still imperfect. They heavily depend on the condition of road marking and the readability of road signs. To propel the development process of self-driving cars, manufacturers need to gather and process a huge chunk of data.
Chris Ballinger, a Toyota official, states that because of the blockchain, automatic cars will be seen running on the roads sooner. Shared (distributed) ledger and blockchains can enable the transfer of necessary data between researchers, vehicle owners, and manufacturers. After that, car manufacturers would be able to gather any data quickly and begin the development of completely automatic electric vehicles.
With Blockchain for Automotive, it can be made easier for corresponding companies to adhere to regulatory compliance. With blockchain for automotive, the automobile sector can become more trustworthy and efficient. Certainly, the technology has immense potential and is highly promising, though not completely mature yet.
Our Blockchain Solutions team, one of the leading blockchain development service providers in India with an extensive expertise in developing IT solutions for various industries, would like to help you develop a well-crafted application based on Blockchain or any other technology. Contact us at [email protected] to learn more.