Blockchain is a truly revolutionary technology. Since the adoption of Blockchain solutions is rampant, we can expect to see more of these solutions in the future. The innovative nature of these Blockchain technology enabled solutions will solve a lot of the automotive industry’s problems.
Though there are quite a few areas in the automotive industries that still require improvement, Blockchain is dealing with some.
In the future, we can expect a greater role of this technology in providing effective solutions. For example, a company called AutoBlock lets users buy a car with a dedicated cryptocurrency called the AutoCoin.
This goes to show how the automotive industry is affected positively by the Blockchain industry. It is evident that Blockchain is going to make things easier for the average consumer.
Let’s have a look at a few challenges in the automotive industry and how Blockchain technology is solving them.
Counterfeit parts can be identified and notified
Blockchain technology can be used to assign digital identities to each and every part of a car. Since counterfeit parts will not have a digital identity, they will easily be identified.
These digital identities will provide car manufacturers with a way to identify counterfeit products. When car manufacturers use this technology along with AI, they can notify the car-owner of any counterfeit part.
Sometimes the car-owners are unaware of the fact that a counterfeit product is being installed. With an alert system, awareness related to parts will increase.
This change is significant as counterfeit parts are not made with a high level of quality assurance. It is often the case that faulty counterfeit products end up causing accidents. Through Blockchain car owners can be notified that a certain part needs to be replaced. This will allow for an overall safer experience for anyone with a car.
Counterfeit parts can cost car manufacturers a significant amount of business. As per some reports, the counterfeit goods industry will reach a value of about $2.3 trillion by 2022. This means that this industry is stealing a lot of the car manufacturers’ profits.
This detection system can also notify the consumer about a part that might need to be exchanged in the future. With such systems and checks in place, the manufacturers can manage the supply chain more effectively.
Communicating the status of the car gets extremely easy with Blockchain. Moreover, this technology also allows us to understand vehicles on an individual basis. This will ultimately benefit the car manufacturer’s ability to provide better customer offerings and services.
It is interesting to note the difference Blockchain can make for the automotive industry.
The process of product recall made more cost-effective
When Ford Motors Co. identified the possibility that a Michigan-produced engine valve may malfunction, they ordered for a recall.
This recall affected 1.5 million Focus cars. This example can enable you to have a better understanding of how big of a deal product recalls are. Car manufacturers want to be able to recall products in a way that is cost-effective.
When a part is not functioning as it should due to a manufacturing fault, a product recall might be necessary. Due to market conditions, normally it would be very difficult to exactly identify the vehicles that are a threat. Eliminating the safety risk is important to protect the brand image of a company.
Traditionally cars did not have digital identities. Since it is difficult to track cars on an individual basis, identifying cars that needed to be recalled is hard.
Due to this inability on the part of car companies, the process of recall was not cost-effective. Car companies usually ended up overcompensating for recalls by offering a recall option for products that might not be affected.
A Blockchain solution can help identify each car on an individual basis. A digital ledger that keeps track of each part used in creating the batch is also possible.
Since Blockchain and AI join together to keep track of the parts used in individual cars, product recall will be effective.
Car manufacturers will be able to specifically recall cars that were affected by an error. With the removal of overcompensation, car companies can maintain profits more sustainably.
The cost of a product recall is already very significant. A Blockchain solution can make it easier for companies to identify the specific cars that need to be recalled. This change will prove beneficial for the automotive industry at large.
Transactions can be made more fast and secure
Blockchain has done a magnificent job in transforming the way payments work. The rapid adoption of cryptocurrency is also influencing the global economic circumstances. The World Economic Forum has estimated that 10% of GDP might end up being stored through Blockchain technology by 2025. This is a clear indication that there is some sort of need fulfillment offered by Blockchain technology.
Blockchain technology provides key stakeholders in the buying and selling process with an efficient payment system.
The AutoBlock is a great example of a Blockchain solution designed to solve problems in the automotive industry. They identified how there is still a lack of acceptability among dealers of cryptocurrencies. With their creation called the AutoCoin, they convinced dealers to use Blockchain technology.
The initiative taken by them will encourage more people to use blockchain effectively. They have successfully created a platform where a cryptocurrency can be used for the automotive industry.
With customized solutions being offered for the automotive industry through Blockchain technology, the future seems bright. Traditionally, there has been a lack of fast and secure payment methods for the purchase of a car.
Blockchain technology can make use of smart contracts architecture which would streamline the payment process. With Blockchain technology, safety is clearly not an issue.
Blockchain is a game-changer in the automotive industry as it provides innovative solutions. Whether they are challenges on the supply chain side or in the payment process, Blockchain can solve them easily.
Digital identities of cars will provide a great opportunity to understand and inform car-owners of car-related issues.
As consumers, we can expect a greater role of Blockchain solutions in the future. In fact, this change may not be that far as many solutions are already offered by Blockchain.