This past decade has had its fair share of ups and down. The world recovered from the financial crises. Some industries grew while others suffered. We witnessed a technological revolution. And slowly, a new digital currency in the form of Bitcoin became mainstream.

While many industries suffered, the automotive sector continued to show a positive growth rate. Now, the turnover of the sector is expected to cross €2 trillion. This is equal to the GDP of the sixth largest economy in the world.

In a separate direction, blockchain too has been growing. By 2024, its market is expected to surpass $3 trillion. When you think of blockchain, you think of cryptocurrency. You think of conducting transactions using the digital currency. The chances are you don’t think of how the technology can also be incorporated in the automotive industry.

The two worlds, i.e., automotive and blockchain, can meet. And they have already. We see solutions like The Autoblock creating rage in the market. We hear conversations about how self-autonomous cars can benefit from using technology in the future.

When you combine the two industries, here is what the future would look like.

Development of cars that are immensely user-friendly

You only have one set of car keys. Sometimes you lose them. Sometimes you can’t find them. When either of this happens, you are bound to feel annoyed. However, there is no other way for you to unlock your car. Well, with blockchain, in the future you can be provided with a way. A blockchain network, which would be run by the car manufacturer, would allow you to be given private keys to control your car. You can use smart contract to give occasional but temporary access to others as well. At other times, no one else but you would have control over the private key. This helps in keeping your car secured.

However, the addition of a smart contract will allow you to transfer access control to others in times of need. So, whether it be giving access to family members of shipping service, you can do it all in your absence without compromising the security of your car. This will make the vehicles of the future user-friendly as well as highly secured. You can lease cars easily via smart contracts as well.

Better data management

Various stakeholders can benefit from receiving transparent and accurate data about your vehicle. Currently, there is no network or system in place that delivers it to them. For instance, the type of car insurance package you receive depends on your driving history. With the help of blockchain that centralizes and encrypts all information related to your vehicle, an insurance company can gauge your performance as a driver and give you an insurance plan that is suitable to your needs.

Moreover, blockchain data can also be accessed by dealerships when you are trading or selling your car. This would make the car valuation process transparent and reflective of the true state of your vehicle. The current vehicle valuation system is considered to be biased and controlled. But, with blockchain’s decentralized nature of data management, this will not be the case. This benefit isn’t just in the cards for the future. Instead, the Autoblock is delivering this solution currently as well. With time, more such companies are bound to spring up.

The end of counterfeit parts

An essential element of the automotive industry is its supply chain function. Currently, the automotive industry’s supply chain function is marked by a high rate of recall. One reason for this is the use of counterfeit parts and the lack of ways to control it.

Counterfeit parts are causing a monetary problem of over 45 billion dollars. Manufacturers are forced to use them at times due to the lack of information about the components. In most cases, manufacturers only have access to the value chain function before theirs. So, they would know about the vendor that delivers them the parts, but nothing before that. This is why counterfeiters have been able to get away with it.

This lack of visibility is what can be targeted in the future. Common parts that are counterfeited without the knowledge of the manufacturer are filters, brake pads, radiators, and airbags. Using such elements put customers at risk. After all, the counterfeit is of low quality. Hence, such brake pads are bound to wear thin quickly.

A future where blockchain and automotive industry combines will help in controlling this problematic industry. Each part can be registered on the blockchain network. This will allow manufacturers to trace the part across the value chain easily. This will help the manufacturers in knowing which parts they receive are truly authentic and which cannot be used in developing automobiles.

Blockchain will bring suppliers of parts and car manufacturers closer via integrating them on one system. With improved visibility, the supply chain can be transparent. And, if the components used are authorized, customers are exposed to lesser risk. This, in turn, will reduce recalls.

Easy authentication of ownership

Have you ever been pulled over and asked to show your car documents to verify if the car is indeed yours? Have you ever misplaced your documents and suffered from the inconvenience that came afterward? Well, you are not alone. Currently, you must carry your car registration and license every time you hit the road.

However, the future looks entirely different from this. In a world where all your data is secured on the blockchain, anyone can verify your ownership instantaneously without the need of any documents. This isn’t just going to be convenient for drivers who won’t have to carry documentation with them. Instead, it will also mean that traffic police spend less time checking and verifying your documents and more time stopping other serious crimes.

Additionally, the use of blockchain can also make the transfer of ownership an easy feat. Rather than tackling never-ending paperwork and waiting for ownership to transfer from one person to the other, a blockchain solution can do it all swiftly. The use of smart-contracts and instant update in the network means the transaction can be set in stone very quickly.

Convenient transactions of used cars

If you have ever bought a used car, you would know that it is always a gamble. If you are buying it from a dealership, they always try to hide the car’s faults and make it look better than it is. Even if you take a mechanic along, there is only so much he would be able to tell you.

The good news for car buyers and the bad news for dealerships and sellers is that blockchain can revolutionize this process in the future. As mentioned earlier, blockchain allows all vehicle-related data to be uploaded on the network. No one can influence this information. It is encrypted and secured. Whether it be mileage, age, number of accidents or repair, you can know the true state of the used car, thereby knowing what you are getting yourself into.

Conclusion

These are just some of the many ways blockchain can transform the automotive industry in the future. Whether or not the industry would be able to realize these benefits soon is something time will tell. However, if properly implemented, blockchain technology can transform the industry for the better.