From numerous technologies knocking doors from all sides, the automotive industry is under a perfect storm of big change. Historically, the automotive industry has always been responsive to technological innovations. Moreover, it is not wrong to commit that the industry of automation is on the brink of evolution.
The 21st-century cars are leading towards advanced technologies equipped with the new potential growth models, onboard sensors, increased efficiency, etc.
As a result, industry leaders like BMW, Toyota, Ford, Mercedes Benz are turning towards smart contracts to unfold the inherent efficiency it holds. The mainframe manufacturer of software and product services, IBM has introduced the consulting business that strategizes business outcomes. For them, blockchain technology is a new way of adopting digital services, assuring privacy, safety, and trust at the same time. Autonomous technology is making an incredible mark on what users want.
Sorting data on a decentralized ledger, facilitating peer to peer protocols, and eliminating central authority proves the utility of blockchain-based smart contracts.
Blockchain Gaining Momentum in the Automotive Industry
In the MarTech Asia summit 2020, the industry experts discussed various sides of blockchain technology. Technology has given more power in the hand of consumers. The panel of three discussed the gap that smart contracts can fill in for the digital marketing industry.
A well-known name like Tech Mahindra, on the time of recognition as a hyper-ledger certified service provider for global blockchain capabilities, said in order to successfully strategize this ‘new normal’ organization, technologies like blockchain must be addressed to gain recognition and increase customer experiences.
What Smart Contracts Can Offer the Automotive Industry
Apart from the decentralized, trustworthy, and transparent transaction, which anyway comes with a smart contract, they are good at performing some other process as well.
Supply Chain Management
A car is an assembled machine. The parts could be lost, stolen, or damaged while transferring from one unit to another. Also, there is a possibility of confusion in the follow-up pieces. Smart contracts not only assists in maintaining the orders but ensures the effective delivery of the pieces at the same time.
Also, it is easy to update the information regarding the changes in the pieces if needed. Or any modification required from the manufacturer side. Since blockchain has encrypted roots, it is perfect for storing data as once the data is stored it cannot be reversed.
Getting a car technically ready needs multiple data to be inserted multiple times. Also the calculation, processing, and delivery of payment for different parts with multiple revisions in the smart contracts follow long procedures.
Buying and Selling a Car
Buying and selling are indispensable parts of the automotive industry. Using a smart contract for the procedure ensures easy verification from both the buyer and seller side. Smart contracts allow major transparency while purchasing a car without a need for a middle man in between.
Renting a car or any other convenience is a major segment of the automobile sector. Using smart contracts one can easily track the location if provided access to the internet of things. Also, it becomes user-oriented as well, as one does not need to carry the documents every time. Simply upload them on the smart contract, and the contract itself assures the rest.
Real examples of Implementation of Smart Contracts in Automotive Industry
In 2018, the IBM industry has found that 62% of auto executives anticipate the smart contract will disrupt the conventional way of trading in the automotive sector. In 2021, the approach seems to be true.
However, China has already ramped up support for blockchain technology. Also, the European Union on April 11, 2018, formed a group named European Blockchain Partnership. Particularly, EBP is an alliance of countries including the Netherlands, UK, Germany, Norway, Spain, and France.
In a statement, the European Commissioner Mariya Gabriel says that Blockchain is a great opportunity for Europe. The member states need to rethink the information system, protection of personal data, and establishing user trust.
Any institution needs a large storage space to store data associated with students and teachers. Smart contracts can assist in saving these large amounts of data on the cloud at potentially cheaper alternatives.