Blockchain’s profound impact on the automotive industry

The automotive sector is one of the driving forces of the global economy. Blockchain appears to be a powerful technology that can propel the automotive industry forward. Today’s vehicles are not seen as just a means of transport. With outstanding innovations such as autonomous cars and electric vehicles, travel has become more convenient and easier.

Automotive Blockchain is a decentralized database used to keep track of automotive related data. The modern vehicles move data centers with on-board sensors and computers that capture information about the vehicle. Car-related data stored in a blockchain is authentic and cannot be tampered with by the system users. The blocks used to keep records of the data are linked together by means of cryptographic principles. It is useful in protecting the data from leaks and manipulations, making the data safer, more secure and more accessible to its customers. Public blockchain balance sheets are primarily autonomously managed and used in peer-to-peer networks for data exchange between associated parties.

In addition, car blockchain brings a variety of benefits to the local transportation system. It allows transactions with the digital currency Bitcoin. Blockchain technology facilitates ride-sharing, helps lower costs, and reduces risk by introducing new business models in transportation systems. It reduces the operating costs in the automotive industry, as it eliminates the need for a dedicated person or third parties to keep track of all the processes, sales, insurance and warranty claims, etc. This technological innovation promotes new ways of cooperation between stakeholders such as governments, infrastructure owners, commuters, local and national authorities, etc., involved in the transport systems.

Moreover, blockchain-powered solutions are useful in car resale as they provide used car buyers with all the necessary information regarding the maintenance, quality test, patterns of defects, etc., of the car. They can also help unlock the full potential of other advanced technologies such as 3D printing, augmented reality, artificial intelligence and IoT, thereby delivering significant value to industrial enterprises.

According to a report published by Allied Market Research, the global automotive blockchain market size is expected to reach $5.6 billion, with a significant CAGR from 2021 to 2030. Europe currently dominates the market with the highest market share and is expected to see the fastest. growth rate during the forecast period. All the major car companies, including BMW, Audi, Toyota, Tesla and others, use blockchain.

However, the outbreak of the COVID-19 pandemic has had a negative impact on the growth of the global automotive blockchain market. There has been a sharp decline in sales and production of vehicles, due to the implementation of the strict lockdown, travel restrictions and social distancing norms worldwide.

Nevertheless, the rapidly growing need for transparency and immutability in the automotive ecosystem is playing a significant role in the growth of the global automotive blockchain market. Various other factors, such as reduced operating costs, protection against data leaks and manipulations, higher acceptance for better payments, usage-based insurance, and transportation and logistics, are driving the growth of the market to a great extent.

With this drive on board, numerous automotive companies operating across the globe have made innovations and developments in the field of automotive blockchain, further fueling the market’s growth. The market players have understood the importance of blockchain adoption for the improvement of transportation, thereby focusing on offering a variety of services to vehicle users.

For example, Cruise LLC planned to use blockchain to collect data from car sensors and develop a trusted map for autonomous vehicles. At the same time, the BMW Group used blockchain to ensure component traceability and the collection of raw materials in the international supply chain process. Renault has chosen to use blockchain technology for its supply chain needs. Likewise, using blockchain technology, Marelli Automotive Lighting boosted automotive supply chain management.

Furthermore, several startups such as Xain, NXM Labs and others have gained experience in the field of automotive blockchain, thereby driving the automotive blockchain market trends across the globe. Although blockchain technology in the automotive industry is still not very popular according to the current demand, it has the potential to enable the automotive industry to leap forward into the new era of smart vehicles. Here it is worth mentioning that the global automotive block chain market has a huge scope to gain huge growth in the coming years.