Gone are the days when blockchain was an unheard term.
Now, blockchain and cryptocurrencies have become a force to be reckoned with. According to TechJury, the blockchain market is expected to reach a whopping value of 20 billion dollars by 2024.
Moreover, as per a survey conducted by Deloitte, 53 percent of organizations terms blockchain to be a critical technology for their organization. One sector that can benefit immensely from technology is the automotive sector.
The automotive sector has continued to have steady demand over the years. In 2017, the global car sales reached up to 78.6 million, as per Statista. Various companies have already incorporated blockchain within this sector.
According to IBM, 62 percent of the sector is set to utilize the technology in various ways by 2021. And by doing so, the traditional car business is poised to be transformed. Here are ways blockchain can impact the automotive industry in the future.
- Swift supply chain through efficient tracking
There is a lot more to producing cars than merely putting the various pieces together. Instead, each organization must also keep tabs on the different car parts. Inventory management of car parts is quite a headache for the supply chain department of car manufacturing companies.
To ensure that manufacturers know each piece that is either damaged, lost in delivery, or stolen, blockchain can be used. Blockchain, if used correctly, can carry information regarding the origin of each car part.
Since only the manufacturer can make modifications to the data, it ensures better transparency throughout the supply chain process.
- Streamlined manufacturing processes
The blockchain technology can be used in several ways to improve the manufacturing processes of the automotive industry. For instance, it can be used to store data for vehicle components via bills of lading.
Similarly, quality-inspection records can be created and altered to store WIP information regarding each car manufactured. This can help keep track of vehicle assembly from beginning to end.
- Accelerating finances
Each sector within the corporate world needs a proper and transparent finance department. Here, data insertion, transaction, expenses, and other financial aspects of the company are taken care of. Blockchain can prove to be the platform where each of these financial processes is stored.
For instance, rather than relying on manual data insertion of transactions and revisions, inventory management and its subsequent effect on different financial reports can be taken care of via blockchain.
This will help in accelerating the pace of finances and help ensure that the organization stays updated regarding its financial changes throughout the lifecycle of a given vehicle.
- Safeguarding a connected car from cyberattacks
With each passing year, we are becoming even more dependent on IoT. We live or strive to live in a highly connected and smart world. The automotive industry, too, has begun seeing connected and smart vehicles.
One drawback of smart vehicles, which feature extensive internet connectivity, is vehicle safety and data security. The more we rely on the online world, the more vulnerable we are to cyberattacks.
Blockchain can combat this problem without relying on the traditional car model. Blockchain allows vehicles to be connected, yet have their data secured. This is because blockchain features robust cryptographic roots that are highly challenging to reverse-engineer. Hence, hackers can’t access the information stored on the platform regardless of how much they try.
In connected vehicles, telematics is often used for car-t0-car communication and software-based navigation. If hacked, such systems can compromise vehicle security immensely. But, blockchain can be combined with these systems to safeguard all the data that is sent as well as received.
By encrypting all the data, hackers cannot view your data, even if they achieve the impossible task of accessing it.
- Delivering smarter insurance
One industry that is linked with the automotive sector and until now operates on a traditional model is the car insurance industry. Blockchain technology has the power to transform this branch of the car business as well.
Blockchain technology can guarantee that no vehicle sensor data that is logged into the system is manipulated or changed. Since the platform is a decentralized system, the unmodifiable documentation of blockchain can help gain clarity about circumstances surrounding different accidents. This is especially helpful in autonomous vehicles.
By knowing the correct details about a given situation, insurance companies can better gauge how to address the different claims.
- Easy buying and selling of cars
The car buying and selling a business is a bread earner for a lot of people. Many buy a car for sale at later times.
Whether you are buying a car or selling it, vehicle verification is always a tedious task. Not to mention that the lack of transparency in vehicle history always makes such a transaction a difficult decision.
Blockchain can effectively revolutionize the buying and selling of cars by creating registries for each vehicle. This can help keep tabs regarding vehicle history. You can know how many times the vehicle has been serviced when it was manufactured, what the origins of its car parts are, and whether or not it has been in an accident. This can help customers get the best deal from sellers.
- Catalyst for carsharing
Carsharing has not yet seen accelerated demand and growth because of the security issues surrounding it. However, with blockchain technology, one can guarantee a secure digital identity of their cars.
Personal data exposure to unnecessary third parties can be avoided through encryption of data via blockchain.
Not to mention that the reaping benefits from various carsharing offers be fast-tracked through the blockchain technology. This is because a single registration on the ecosystem will be usable for all the service providers on the platform.
Ending Remarks
Blockchain has the power to transform and improve the car business through and through. From the moment a car is made till the moment customers use it, blockchain can streamline it all for a better experience.