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The swift journey of blockchain from a buzzword to reality is fascinating. Blockchain is currently transforming many industries from healthcare to the food supply chain. Now auto manufacturers are envisioning how distributed ledger technology can be applied to power autonomous vehicles and improve them, increase customer retention, satisfaction, and the overall auto experience. But how is this drive to innovation being done?
With blockchain maturing and demand for autonomous cars picking up, blockchain is now being considered to manage, store and transfer digital records like vehicle identification, possession, warranties, wear and tear, mileage, leases, loans, parts and service info for automobiles.
Blockchain and smart contracts will enable this data to be stored in a decentralized, shared ledger format. A portion of this ledger data will be available to the authorized parties based on their access rights and needs. Thus, blockchain will enable vendors, authorities, and other entities in the mix to verify credentials and use them in near real-time.
For example, motor vehicle agencies leveraging blockchain who need to collaborate with external organizations like the U. S. Departments of Justice and insurance providers, will be able to provide indisputable information to the required agencies.
Vision and benefits of blockchain to the auto industry
In 2019, IBM filed a patent for a project that would permit it to manage information and interactions for self-driving autonomous cars that using blockchain technology. This technology outlines the various parameters that can be used to assess nearby drivers’ behavior, using a wide array of sensor IoT technologies. This collected data can be leveraged to optimize risk assessment based on the predicted and the actual maneuvering of nearby vehicles and drivers.
In the age of autonomous automobiles, billions of IoT devices must interact with each other without little delay. These interactions must be auditable and shareable. Blockchain provides a decentralized platform that makes it harder to tamper with, thus supporting transactions that are secure, private and efficient.
In the autonomous vehicle world, there are many players who contribute to this ecosystem. For example, the shared ledger of a specific car which includes auto manufacturer data, real-time data from sensors, street conditions, environment variables, OEMs, insurance vendors and others key players, will form a significant subset of information necessary to support the functionality the automobile will need to operate autonomously.
Emerging use cases
One major automaker is piloting a digitized automobile safety software program which leverages the underlying blockchain as a shared ledger to log all vehicle repair and upkeep information in a single location. All this is possible by integrating the blockchain technology into the automobile industry’s DNA.
Industry experts are also experimenting with the future of integrating IoT into micro-transactions on the automobile platform. Some top automotive players are moving forward to participate in blockchain projects with many other use cases still being explored, like smart manufacturing or on-demand manufacturing with supply chain traceability.
Blockchain can play a pivotal role in a typical supply chain management scenario within the auto manufacturing sector by providing a unique ID for every part number and espousing it with the IoT technology to unravel cost, dispute and other supply chain tribulations from product inception, design, development distribution financing and leasing.
Challenges still ahead
Though blockchain is backed by various success factors, its application for automotive use cases still faces major external challenges like lack of experience, knowledge, hands-on training and scalability.
The first challenge facing commercial blockchain in the automotive sector is the sheer number of parties that might be asked to adopt decentralized ledgers. This, in addition to dynamic and geographically variable regulatory regimes, are factors which will have to be overcome for broader adoption in order to achieve greater value and efficiency.
By 2025, approximately 8 million cars are expected to be in transit with “conditional” automation or higher. So, while the industry faces similar old problems, like supply chain management and vehicle safety questions, new challenges still involve technological innovation and the evolution of industry standards.
Blockchain is the precise application for providing greater oversight and accountability in automotive supply chains and may also function as a way by which drivers can view and understand how their vehicle’s data is being shared and utilized.
Am I driving or riding?
Combine technological advancements with the changing equilibrium by new entrants into the auto industry. Also combine consumer acceptance of cost and regulatory landscapes with the nature of control exchanges and driver monitoring.
Blockchain remains in the driver seat to help take the auto industry to the next level.
We drove automobiles for over a century. Now, it’s time to enjoy the ride!