The automotive industry encompasses a vast ecosystem, including brands, dealerships, suppliers, insurance companies, and customers. Each of these entities covers different aspects of the automotive industry and has the potential to use blockchain technology to streamline operations and redefine business models.
A significant perk of blockchain technology is that it offers secure and transparent transactions. This makes it a go-to solution for the automotive industry, which stands heavily on trust and accountability. In the following, we will introduce some of the use cases of blockchain technology in the automotive industry:
Blockchain technology helps with tracking the supply chain of the automotive industry, from production to the final assembly of vehicles. All stakeholders in the supply chain can check the entire process in real-time, ensuring greater transparency and accountability. This implementation can help mitigate fraud, increase efficiency, and improve the quality of products.
BMW partnered up with blockchain startup Circulor to track the sourcing of raw materials for its electric vehicle batteries. The blockchain-based system enables BMW to follow the origin of the cobalt used in its batteries. This ensures that it comes from ethical sources, which is important both for regulatory and marketing purposes
Blockchain can provide a tamper-proof record of a vehicle's ownership history, which is crucial in the automotive industry. This can help prevent fraud and ensure that customers are purchasing legitimate vehicles. In the secondary market, this process can enable a certificate of authenticity for dealers, increasing the value and sales of the vehicles. Another use of blockchain in the automotive industry is the authentication of production parts. This ensures that they are on par with the required standards and regulations.
Italian automaker Alfa Romeo has recently announced the use of non-fungible tokens (NFTs) to certify purchase of its new Tonale SUV and record data during its life cycle. The NFT will generate a certificate, which will ensure the vehicle's proper maintenance. This will have a positive impact on its residual value. Furthermore, the blockchain will store all the car's data. Changing, hacking or cheating the system will be difficult or impossible. Alfa Romeo claims the Tonale NFT is the first in the automotive industry, providing a unique certification and recording of data that is becoming increasingly popular in digital artwork.
Smart contracts allow for the automation of many of the processes involved in the automotive industry, such as vehicle maintenance, warranty claims, and insurance claims. Smart contracts eliminate unnecessary intermediaries, streamline processes, and reduce costs. They are self-executing computer contracts with the terms of the agreement between buyer and seller being algorithmically coded.
Leading car manufacturer Porsche, has partnered with startup XAIN to test a blockchain-based system that allows for the autonomous communication of vehicles. The system uses blockchain technology to create a secure and decentralized network, allowing vehicles to share information without relying on a central server.
A decentralized dealer network can be created through blockchain technology, allowing customers the peer-to-peer sale and purchase of vehicles thus reducing the costs associated with traditional dealerships and creating new revenue streams for customers. Additionally, blockchain technology can be used to manage dealer inventories, making it easier for customers to find the vehicle they are looking for.
Honed for enterprise needs, private sharding is a technology that allows a blockchain network to be partitioned into smaller, private sub-networks or shards, which can operate independently.
Calimero private shards can be particularly useful in introducing blockchain to the automotive industry. They allow brands, dealerships, and insurance companies to share information and collaborate while maintaining data privacy and security. By utilizing private sharding in the automotive industry, each entity can own its private shard. This allows it to store, manage, and share its data conveniently and only with entities of its choice. Private shards also communicate using a shared public shard, providing greater security and accountability while maintaining data privacy.
Blockchain has the potential to revolutionize the automotive industry by streamlining operations, reducing costs, and creating new revenue streams. At Calimero, we have positioned our products at the forefront of this wave. From supply chain management to dealer networks to insurance, Calimero private shards offer ways to achieve a more efficient and innovative auto industry.