The Automotive Industry Adopts Blockchain Solutions

Image Source: industrywired.com

I’m a Southern Californian. I grew up in a world of cars. Southern Californian was developed with open land, highways, and large parking lots. There is no doubt—“California is one of the hottest beds of car culture in the world. Especially Southern California,” says Kristin Lee  Indeed, with the 405 freeway packed with cars nearly anytime of the day, there’s no doubt we have a love affair with our car.

“California is one of the hottest beds of car culture in the world. Especially Southern California,” says Kristin Lee 

But that doesn’t mean we aren’t environmentally conscious. And nor are we the only region in the world with a love affinity for cars. Try driving 10km in Seoul or Busan in South Korea. And it’s clear—they too have a love affair with their cars.

They are environmentally conscious. Indeed, Hyundai has gone green with blockchain. In collaboration with IBM , Hyundai Motor Group will “use blockchain in its new tech for pairing electric vehicles (EVs) with smartphones” to help drivers monitor their driving habits in a way that optimizes road conditions, driving habits, and vehicle operations in an effort to reduce fuel consumption.

Blockchain Making Inroads

According to a study by IBM Institute for Business Value  62% of executives from the automotive industry believe that blockchain will “be a disruptive force in the auto industry by 2021.”

The research culled out a group of early blockchain adopters, dubbing them Auto Pioneers. According to the study: 54% of “Auto Pioneers will implement their first commercial blockchain network at scale within the next three years.”

Regardless of whether one is driving an ecology friendly electric car, or a gas guzzling muscle car, all vehicles being manufactured are moving in the direction of becoming more than a transportation vehicle. They are becoming “moving data centers” complete with onboard sensors and computers—much like an airplane’s black box—used to capture data on the vehicle. Blockchain has the potential to be in the center of managing the data. Because blockchain transactions are more secure, traceable, and provides transparent access to information—it has the potential to build “trust and collaboration among businesses, consumers and even vehicles.”

Opportunities

As the industry looks at examples of blockchain use cases for fintech, supply chain, and the Internet of Things (IoT)—automotive executives will find opportunities for the blockchain use case to be applied to the their industry.

Deloitte says of blockchain: “Opportunities exist across the industry, including for Original Equipment Manufacturers (OEMs), suppliers, dealers, financers and end-consumers among others.”

Looking at business operations, blockchain has potential in ways that can be used to “make existing processes more efficient, support the move into adjacent services and markets, and help the development of new transformative services.”

After analyzing over 40 use cases— Deloitte identified three blockchain use case groups that can be applied to a wide application in this industry.

The first category for blockchain application can be applied to supply chain. It will improve verification processes and deficiencies. These include know your supplier, provide an ability to trace products to its origin, and be able to connect the origin of a part for targeted recalls.

Secondly, as in the case of Hyundai, blockchain technology can be used for vehicle management information, and to assist with incentives such as “dealer and customer incentives, extended vehicle ledger, odometer fraud, ride sharing and on-demand mobility services.”

The third category is finance and insurance. Blockchain can be used to improve transaction processes and relate information such as validating insurance contracts, finance and leasing data, and connected services.

Collaboration

As the industry moves forward with blockchain technology and the adoption of use case applications, perhaps one of the most obvious indicators that the blockchain revolution is gaining traction in the automotive industry—is the launch of MOBI (Mobility Open Blockchain Initiative).

MOBI  is a collaborative effort of BMW, General Motors, Ford and Renault with leading blockchain and technology organizations such as IBM, Accenture,  ConsenSys, and NGOs. It also includes academic organizations such as the World Economic Forum and Blockchain at Berkeley.

According to Zigurat, MOBI held a colloquium in February to “promote and develop common standards for applying blockchain and distributed ledger technologies (DLT) in the mobility industry.”

 Conclusion

Regardless of where you live, you’re likely driving a car, or taking an Uber lift to your next meeting. As the global community looks for ways to improve transportation, and keep the planet green, blockchain looks to have promising use case applications.

The industry is forging ahead with early adopters having stepped out, and now leading manufacturers and tech firms are teaming to move forward with market disruptive technology that will shape the way vehicle data is collected and used.

 

Samuel H. is an author, writer and speaker with over twenty years in the educational technology sector.

Contact Samuel

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