{"id":5927,"date":"2017-10-08T20:43:05","date_gmt":"2017-10-08T15:13:05","guid":{"rendered":"http:\/\/www.allerin.com\/blog\/?p=5927"},"modified":"2017-10-13T16:28:03","modified_gmt":"2017-10-13T10:58:03","slug":"this-is-what-the-automotive-industry-can-do-with-blockchain","status":"publish","type":"post","link":"https:\/\/www.allerin.com\/blog\/this-is-what-the-automotive-industry-can-do-with-blockchain\/","title":{"rendered":"This is what the automotive industry can do with blockchain"},"content":{"rendered":"

\"\"<\/a><\/p>\n

Let\u2019s start with a simple fact \u2013 By 2025, participants in the automotive sector are expected to spend approximately 0.6% of their total IT spend on blockchain technology<\/a>, alone. Ranging from supply chain management to leasing, a variety of automotive industry verticals have been identified, where blockchain has the potential to be a disruptor. The industry is, therefore, beginning to build momentum to experience blockchain penetration outside of an R&D or a lab setting.<\/p>\n

\"\"<\/a><\/p>\n

Blockchain technology in the automotive industry<\/h1>\n

Since early 2017, automakers, from around the globe, have shown marked increase in the activity to explore how blockchain technologies can be used. Blockchain technology in automotive industry is not just about the transformation of the OEM\u2019s working mode but is also about fundamental changes to the current business models. Here are some of the most obvious ways of using blockchain technology in the automotive industry.<\/p>\n

Provenance and Tracking<\/h1>\n

A key differentiator for most automotive companies is the customer\u2019s trust in the quality of their brand and products. With blockchain, a digital track for each product\u2019s development, such as the source of the raw material, how and where the product was manufactured, their maintenance history, can be recorded. Likewise, each part of the product, including design quality and production data, can be tracked. Using blockchain, the authenticity, provenance, purchase, trading, and license use can all be protected. Multiple supply chain partners can use this technology to corroborate the authenticity of their products.<\/p>\n

Lease, Insurance, and other services<\/h1>\n

Since the idea is to see vehicles as \u2018smart\u2019 vehicles, all services and their underlying business models will need to be revolutionized as a whole with blockchain. As transactions on blockchain are always recorded and verifiable, the future of car insurance and lease is bound to change<\/a>. Insuring a vehicle would become a more on-demand and dynamic process. Modern insurance policies would base themselves upon real-time vehicle data. With blockchain enabling smart contracts, a vehicle would choose its own insurance policy. Similarly, a leased vehicle would manage all necessary contractual transactions using smart contracts drawn on it. This means that a vehicle would enforce monthly leasing payments and decline the service in case a payment fails. As all the transactions are maintained on a vehicle\u2019s own blockchain, they are all instantly available whenever required.<\/p>\n

Supply chain and Business Processes<\/h1>\n

The automotive sector has many ERP and operational systems<\/a> that manage the manufacturing process and generate vehicle data. These, in turn, communicate with hundreds of other systems downstream, which are dependent on several data feeds to perform their functions. All of this results in bloating the size of the IT team that reconciles between the various systems and introducing complexity in the IT landscape. Blockchain simplifies the situation. It drastically reduces the risk of two or more systems using conflicting information. This is because blockchain enforces a single source of information, in real-time. This also eliminates the need for auxiliary systems that are needed to reconcile any errors or inconsistencies between systems. People and systems can, therefore, act faster and with more confidence.<\/p>\n

<\/h6>\n

Blockchain in the automotive industry can significantly streamline processes. It alleviates the need for regulatory and compliance approvals. CIOs, CFOs, and CTOs should be able to make a strong business case for implementing blockchain in the automotive arena. The technology prepares vehicles for a future environment where they would interact with it in new ways.<\/p>\n","protected":false},"excerpt":{"rendered":"

Let\u2019s start with a simple fact \u2013 By 2025, participants in the automotive sector are expected to spend approximately 0.6% of their total IT spend on blockchain technology, alone. 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