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Abstract

at Berkeley in May 2018, most industries in the automotive sector started adopting the blockchain technology.</p><p id="097f">MOBI was founded with the hope of improving the quality of life. In February 2019, a two-day event was held among members of MOBI to promote and develop common standards in the application of blockchain and Distributed Ledger Technologies (DLT) in the automotive industries.</p><p id="473f">Over the last two years, major automotive industries have started to use blockchain technology in vehicle supply chain, security, car service, autonomous vehicles, manufacturing process, insurance and so on. Some of these companies like General Motors (GM), Porsche, BMW have partnered with blockchain startups like XAIN, Spring Labs, VeChain Thor to address complex issues.</p><figure id="4b53"><img src="https://cdn-images-1.readmedium.com/v2/resize:fit:800/1*SAKVHnqRiWMe8jYliRmI3A.jpeg"><figcaption></figcaption></figure><h1 id="4138">How blockchain technology is impacting the automotive</h1><p id="e637">Most automotive industries have started to use blockchain technology because it positively contributes to different segments as explained below.</p><h1 id="b9af">1. Supply chain</h1><p id="000b">The automotive supply chain is complex because it contains numerous types of hardware, software, firmware distributors, dealers, regulatory agencies, insurance companies and more. Supply chain also manages product transfer and this transfer costs a lot of time and money because of intermediaries.</p><p id="7874">In the automotive industry, blockchain offers transparency and optimizes vehicle shipments while providing seamless integration of digital contacts, shared inventory, pricing, invoicing, payments and logistics information. This high level of transparency is achieved using the blockchain distributed ledgers.</p><h1 id="7958">2. Manufacturing process</h1><p id="9b4e">In vehicle manufacturing, blockchain can effectively prevent counterfeit issues because every vehicle part must have a unique identity number. This also helps in issuing a less complicated recall.</p><h1 id="c856">3. Autonomous vehicles</h1><p id="e963">Blockchain technology has helped in the manufacturing of autonomous vehicles. Autonomous vehicles are equipped with autopilot modes which can allow the vehicle park itself or do other tasks by instructing the car’s digital computer using voice commands.</p><h1 id="4d6a">4. Identification and tracking</h1><p id="f593">Because of the RFID tags on blockchain manufactured vehicle parts, each component can be easily verified for authenticity.</p><h1 id="960a">5. Ownership transfer</h1><p id="a054">Blockchain technology provides maximum transparency and speeds up the process of change of car ownership. Blockchain also uses a smart contract where the seller and buyer can enforce the transaction of goods without the need for a middleman.</p><figure id="39b7"><img src="https://cdn-images-1.readmedium.com/v2/resize:fit:800/1*XDHfsZrOOcMnkyrGYzaXYQ.jpeg"><figcaption></figcaption></figure><h1 id="fe97">6. Automated vehicle maintenance</h1><p id="94a1">Most cars that use blockchain come with on-board computer

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s like Engine Control Unit (EDU) which contain error logs so that the service professionals can quickly <a href="https://www.fpt-software.com/automotive-tech-blog/what-you-need-to-know-about-on-board-diagnostic-systems/">diagnose</a> and repair the car in less time. Using blockchain, maintenance status can be easily tracked without visiting a mechanic station so you can avoid towing your vehicle to one.</p><h1 id="be3a">7. Insurance</h1><p id="09dd">Most insurance claims are fraudulent and they use concealed methods when issuing policies and managing claims, which results in high operational cost and ineffectiveness. Blockchain addresses this by enabling unmanipulative and transparent logging of the vehicle sensor data in a decentralized network. Blockchain provides new telematics add-on services, which provides insurance companies with driver locations, drive duration, acceleration and braking behaviors, vehicle speed, and other information. Blockchain also enables insurance to be taken into other vehicles like a user profile; this process can be termed carsharing.</p><h1 id="db5e">8. Security</h1><p id="de9b">Vehicles are becoming autonomous, which makes them more connected and more susceptible to deadly cyber attacks. This is why blockchain uses strong cryptographic roots that cannot be reverse-engineered. Blockchain’s Distributed Ledger Technology facilitates data storage and offers immutability.</p><h1 id="7be0">9. Financing</h1><p id="63f2">As cryptocurrencies are making a stand in the financial industry, the automotive finance industry also makes use of cryptocurrencies for payments.</p><h1 id="5b2b">10. Infotainment</h1><p id="7b60">Blockchain allows add-on that is capable of making in-car payments for movies, and other services are kept secure. With blockchain’s infotainment services, passengers can relay their information, and also view life video of far-away events.</p><p id="bc55">Apart from the impacts of blockchain listed above, blockchain contains smart contracts that are equipped with the Internet of Things (IoT) services to ease up authentication and validation processes. Blockchain also triggers machine-to-machine (M2M) transactions with the use of smart contracts.</p><h1 id="1ab6">Concluding Thoughts</h1><p id="391c">Blockchain technology is improving rapidly which means that in the next one or two years, blockchain would be able to provide solutions to many of the challenges the automotive industry faces. Believe it or not, blockchain technology would be the next big thing changing the world of vehicles.</p> <figure id="850c"> <div> <div> <img class="ratio" src="http://placehold.it/16x9"> <iframe class="" src="https://cdn.embedly.com/widgets/media.html?src=https%3A%2F%2Fupscri.be%2Fb2a0d6%3Fas_embed%3Dtrue&dntp=1&display_name=Upscribe&url=https%3A%2F%2Fupscri.be%2Fb2a0d6%2F&key=a19fcc184b9711e1b4764040d3dc5c07&type=text%2Fhtml&schema=upscri" allowfullscreen="" frameborder="0" height="400" width="800"> </div> </div> </figure></iframe></div></div></figure></article></body>

How Is Blockchain Technology Impacting The Automotive Industry

he digital era is fast evolving and different sectors have embraced the use of digital transformation technologies. The automotive industry is also embracing automotive technologies consulting to keep up with the evolving trends in the digital world and provide enhanced customer experience and service.

Today, vehicles are evolving from a simple mode of transport to complex moving machines with on-board sensors and computers. After the introduction of blockchain, the automotive industries have received the most revolutionary and exceptional upgrades in their processes that have made them focus on cases that once seemed complex.

How Blockchain Technology Entered Automotive Industry

Blockchain is a distributed database that hosts a continuously growing number of records. These records are stored in blocks instead of in a single file. Blockchain technology has revolutionized the marketplace using peer-to-peer networking where every node stores and transmits data over an encrypted channel. Blockchain is considered as a modern business infrastructure that facilities trustworthy business models.

Blockchain technology is set to become prominent in the automotive industry in the same way as technologies like artificial intelligence, machine learning, high performing GPS and sensors.

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You might be wondering what blockchain has to offer in the automotive industry because it is well known that the financial industry accounts for a significant amount of investments and activities in the blockchain.

After the launch of Mobility Open Blockchain Initiative (MOBI) which was in a conference between major automators (BMW, General Motors, Ford transit), leading blockchain technology startups, premier organizations (IBM, Accenture, Cosensyn), NGOs and academic institutions like the world economic forum and blockchain at Berkeley in May 2018, most industries in the automotive sector started adopting the blockchain technology.

MOBI was founded with the hope of improving the quality of life. In February 2019, a two-day event was held among members of MOBI to promote and develop common standards in the application of blockchain and Distributed Ledger Technologies (DLT) in the automotive industries.

Over the last two years, major automotive industries have started to use blockchain technology in vehicle supply chain, security, car service, autonomous vehicles, manufacturing process, insurance and so on. Some of these companies like General Motors (GM), Porsche, BMW have partnered with blockchain startups like XAIN, Spring Labs, VeChain Thor to address complex issues.

How blockchain technology is impacting the automotive

Most automotive industries have started to use blockchain technology because it positively contributes to different segments as explained below.

1. Supply chain

The automotive supply chain is complex because it contains numerous types of hardware, software, firmware distributors, dealers, regulatory agencies, insurance companies and more. Supply chain also manages product transfer and this transfer costs a lot of time and money because of intermediaries.

In the automotive industry, blockchain offers transparency and optimizes vehicle shipments while providing seamless integration of digital contacts, shared inventory, pricing, invoicing, payments and logistics information. This high level of transparency is achieved using the blockchain distributed ledgers.

2. Manufacturing process

In vehicle manufacturing, blockchain can effectively prevent counterfeit issues because every vehicle part must have a unique identity number. This also helps in issuing a less complicated recall.

3. Autonomous vehicles

Blockchain technology has helped in the manufacturing of autonomous vehicles. Autonomous vehicles are equipped with autopilot modes which can allow the vehicle park itself or do other tasks by instructing the car’s digital computer using voice commands.

4. Identification and tracking

Because of the RFID tags on blockchain manufactured vehicle parts, each component can be easily verified for authenticity.

5. Ownership transfer

Blockchain technology provides maximum transparency and speeds up the process of change of car ownership. Blockchain also uses a smart contract where the seller and buyer can enforce the transaction of goods without the need for a middleman.

6. Automated vehicle maintenance

Most cars that use blockchain come with on-board computers like Engine Control Unit (EDU) which contain error logs so that the service professionals can quickly diagnose and repair the car in less time. Using blockchain, maintenance status can be easily tracked without visiting a mechanic station so you can avoid towing your vehicle to one.

7. Insurance

Most insurance claims are fraudulent and they use concealed methods when issuing policies and managing claims, which results in high operational cost and ineffectiveness. Blockchain addresses this by enabling unmanipulative and transparent logging of the vehicle sensor data in a decentralized network. Blockchain provides new telematics add-on services, which provides insurance companies with driver locations, drive duration, acceleration and braking behaviors, vehicle speed, and other information. Blockchain also enables insurance to be taken into other vehicles like a user profile; this process can be termed carsharing.

8. Security

Vehicles are becoming autonomous, which makes them more connected and more susceptible to deadly cyber attacks. This is why blockchain uses strong cryptographic roots that cannot be reverse-engineered. Blockchain’s Distributed Ledger Technology facilitates data storage and offers immutability.

9. Financing

As cryptocurrencies are making a stand in the financial industry, the automotive finance industry also makes use of cryptocurrencies for payments.

10. Infotainment

Blockchain allows add-on that is capable of making in-car payments for movies, and other services are kept secure. With blockchain’s infotainment services, passengers can relay their information, and also view life video of far-away events.

Apart from the impacts of blockchain listed above, blockchain contains smart contracts that are equipped with the Internet of Things (IoT) services to ease up authentication and validation processes. Blockchain also triggers machine-to-machine (M2M) transactions with the use of smart contracts.

Concluding Thoughts

Blockchain technology is improving rapidly which means that in the next one or two years, blockchain would be able to provide solutions to many of the challenges the automotive industry faces. Believe it or not, blockchain technology would be the next big thing changing the world of vehicles.