Blockchain as a technology is famously known to power cryptocurrencies like Bitcoin, Ethereum, Dogecoin, etc. It has been the talk of the town in the automotive industry as well, thanks to the now considered Iron Man of the real world, Elon Musk.
But while most of the world is contemplating blockchain being used for mining more and more Bitcoins, some in the automotive industry are trying to implant the tech into your future car. This has enabled modern-day cars shifting from being more software-focused than hardware-focused machines.
Striving for autonomous automobiles has evolved cars into live data centers with all the endless computers and sensors onboard. Thus, due to the safety net provided by blockchain technology, it is even more imperative to implement it to safeguard autonomous data. With the competition among automakers getting more aggressive day by day, cars in the 21st century are getting access to various new cutting-edge technology.
Now, automakers are working together to inculcate blockchain well within the roots of the automobile. Brands like Ford and BMW have already implemented blockchain within their manufacturing process. So what does blockchain bring to the table when it comes to the future of the automotive industry?
Today, we discuss the impact of one such futuristic technology in the automotive sector that is, blockchain technology. Although this concept is entirely new to many tech enthusiasts, blockchain has already influenced the creation of many cryptocurrencies including bitcoin.
How exactly are automakers planning to bring blockchain to their cars?
Four of the world’s biggest automakers have joined hands with other technologically advanced companies to integrate blockchain technology, within the comfort of your car. Ford, BMW, Renault, and General Motors have expressed their initiative to explore blockchain technology by extending their support to the Mobility Open Blockchain Initiative (MOBI). Other companies among the founding 30 members include the likes of IBM, Accenture, Consensys, Bosch, and Blockchain at Berkeley, as per MOBI reports.
In February 2019, all these founding members gathered together at a 2-day colloquium that was held at the BMW Group IT Centre in Munich. This event brought about awareness among the masses on how to inculcate common standards of blockchain technology and distributed ledger technologies. Thus, the founders of MOBI believe that blockchain represents a bright future of mobility that would improve the quality of living in cities. It also represents a greener and safer method of effortless digital transactions.
However, for the proper implementation of blockchain, a set of clearly defined universal standards must be implemented so that the stakeholders create an open and independent platform. This platform would be the base for all future blockchain applications.
How Blockchain is shifting the tide in the automotive industry
So what exactly is blockchain? Experts explain it as the underlying technology behind all the world’s cryptocurrencies, including the likes of bitcoin and dogecoin. Basically, with blockchain, the system collects information together in groups, also known as blocks. The specialty of blockchain is that the system records information in such a way that makes it impossible to modify, hack or cheat the system. The blockchain network creates a digital ledger of transactions by duplicating and distributing it across the entire network of computers within the blockchain.
Thus, the new group created aims to speed up the whole process of integrating blockchain within the automotive industry. This involvement from the world’s largest automakers adds an interesting perspective to the battle for tech supremacy. Carmakers like Daimler AG aim to add such advanced tech to their electric models like the Mercedes-Benz EQC.
As Mr. Brian Kelly, founder, and CEO of digital asset investment firm BKCM describes, the car will be the new battleground for tech companies. He also said that the introduction of blockchain technology is a tectonic shift in the tech landscape and that it has the potential to disrupt the growth plans of legacy tech into automobiles.
How can blockchain be integrated into the automotive industry?
The automotive industry has never shied away from experimenting with new technologies. This bold approach has helped them streamline their operations and boost their revenue by introducing new user functionalities. Similarly, blockchain aims to streamline the automotive industry by providing its benefits in the following sectors-
A] Car Manufacturing:
Supply Chain Management: Car parts have a tendency to get lost while in delivery or get stolen, damaged, or replaced. To prevent any of these from happening, blockchain comes in as the savior by providing the manufacturer with a complete follow-up of these parts. Blockchain also helps to resolve recalls more efficiently. By searching the history of the piece, the automaker can conclude whether any modifications have been made to it or if it contains a manufacturing defect.
Manufacturing Processes: Blockchain takes care of a variety of manufacturing processes, ranging from storing data from bills of lading for vehicle components, quality inspection records during the manufacturing process, and WIP information for each vehicle assembly.
Finances: Blockchain can help streamline all manual data insertion processes used in auto manufacturing, like transaction costs and revisions. Blockchain keeps track of all these processes during the lifecycle of the car.
Vehicle Safety and Data Security: As more and more vehicles get connected, they are equally vulnerable to attack from hackers. Thanks to the strong cryptographic roots within the blockchain, the data stored within the blockchain is safe from reverse engineering and cannot be changed even in the case of a deadly cyber-attack.
Smart Insurance: With blockchain, the vehicle’s sensor data can be stored securely and transparently in a decentralized network. Thus, the concept of a ‘blockchain black box’ can be used to resolve the circumstances of an accident for autonomous vehicles. Blockchain also enables the transfer of insurance to other vehicles with the help of a user profile, e.g in carsharing.
Telematics and Infotainment: The car’s telematics represents all its software-based navigation, vehicle-to-vehicle (V2V) communications, and other safety services that have a hand in vehicle and passenger safety. With the help of blockchain, we can safely maintain the data that is transmitted by telematics services. With such a high level of encryption, no hackers can steal or view the data emitted by the vehicle telematics.
B] Car Owners:
Buying and selling a car- Blockchain has enabled flawless transparency in the car selling process. Any user can directly survey the car’s history through the blockchain entries and find whether it has been involved in an accident. Through blockchain, the buyer can also get a clear overview of all parts of the vehicle. With blockchain, there is no need for a middleman between the buyer and seller, thanks to the transparent transactions involved in the process.
C] Mobility Sector:
Leasing and Vehicle Financing: With blockchain, we can simplify and automate the various processes involved in car leasing and financing. For example, if a car’s lease hasn’t been paid, we can prevent the user from using the car by deactivating the unlocking system.
Car Sharing: Blockchain also helps to build yourself a secure digital identity to avail of the carsharing services. This way no external party can steal your personal data which you have saved in your car. Blockchain also simplifies the carsharing process by registering other users through a single registration in the blockchain ecosystem.
Car Rental: Blockchain keeps a track of all the activities currently going on with the car like maintenance or cleaning. This way the car rental company gets a report of the current state of the car.
Current implementations of blockchain in the automotive industry
Recently, Ford started using a blockchain pilot on the IBM platform for ethical sourcing of cobalt. Thus, Ford is tracking the cobalt supply chain through their blockchain network to ensure that companies aren’t using any inferior cobalt while producing lithium-ion batteries.
Volkswagen is also working towards a blockchain initiative that should prevent odometer fraud in the automotive industry that is currently a widespread issue. Thus, dishonest car dealers can’t trick their buyers by selling them faulty odometers that provide deceptive mileage values. This keeps control of malpractices and ensures that the customers don’t incur any losses.
Recently, Hyundai has also partnered with IBM to create new blockchain technology and cloud-based AI. Hyundai is planning to use this blockchain for its supply chain financing ecosystem. It also aims to add it to the in-car experience of the user. Thus, we might soon see its flagship models like the Hyundai Palisade showcasing the technology.
Another Asian carmaker, Honda, has added a suite of applications that let users purchase services straight from the car’s infotainment system. This includes making reservations and purchasing movie tickets as well.
IBM is currently developing this blockchain using open-source Hyperledger Fabric and they aim to automate the manual processes, reduce cost and provide a seamless customer experience. BMW and General Motors are also experimenting with blockchain through their MOBI initiative, as they share the data of their self-driving cars with themselves and other automakers.
Currently, we have only discovered a drop in the ocean when it comes to technologies like blockchain. Still, we have seen remarkable applications of blockchain technology well within the automotive industry. It does lead to a future that is safer as well as simple for the end-user in the car market.
With initiatives like MOBI, more and more manufacturers will join the blockchain revolution and streamline their data using this advanced tech. Although there may be some doubters along the road, blockchain ensures a tamper-free and transparent data-sharing process that will be of utmost value to automakers in the near future. Thus, while the possibilities seem endless, technology is still very much at an early phase of development when it comes to cars.