Automotive Industry

With various parties involved in the designing, production, distribution, marketing, selling, financing and servicing of vehicles – Automotive industry is a complex ecosystem on its own.

Let’s explore how Blockchain technology can benefit this humongous industry:

Manufacturing Plant Inbound Logistics: To guarantee timely delivery of parts and optimised inventory levels, a manufacturing unit must coordinate effectively with suppliers, third party logistics and transportation companies. A Blockchain based system would allow greater transparency of correct information between the different parties involved. This will in turn improve just-in-time logistics, reduce order errors and raise inventory turns.


Manufacturer Finance: The receivables payment for a car manufacturer can be from several weeks to months after the sales of the vehicle from importer/distributor/dealer. Letter of Credit by the purchaser’s bank or submission of Bill of Lading by the manufacturer are still the procedures that comprise heavy flow of form-filling and paperwork. With a Blockchain based the settlement period (of the manufacturer receiving payment) for the cars delivered can be reduced drastically. As a Blockchain based system would enable greater transparency of thorough information between the parties involved and quicker processing of export/import and banking documentation.

Retail: Vehicle history is of immense importance in the automobile industry. An auto-financer provider doesn’t know about the real driving behaviour of its car drivers or their vehicle’s service history. But with a Blockchain-enabled system the driving patterns and service events will be recorded in the shared ledger that will be accessible to all parties. Auto-finance provider can be hugely helped with the transparent information about the vehicle’s real usage and thus will help them in gauging more accurately the residual value of the vehicle.

Vehicle/Brand Experience: : Many car manufacturers nowadays offer subscribed customers access to additional vehicles in its range on a contract. With the Blockchain-enabled system the car company can securely transmit the owner’s special mobility profile (like preferences for seat settings, climate, infotainment etc.) between several vehicles and even third-party partners (car sharing or multi-modal transport providers). In saying so, the car manufacturers will be able to maintain personal mobility profiles of the customers, which will help them offer better service to their customers.

Genuine Spare Parts & Warranty: The biggest worry of the car manufacturer is that the service centres and garages might be knowingly fitting spurious spare parts to their customer’s vehicles. A Blockchain based system would enable the car manufacturer, service centre and the customer to track the authenticity of the spare parts back to its original manufacture date and location. This in turn would check the damage to brand reputation and warranty costs for the car manufacturer, in case the counterfeit spare parts are worse, underperforming or in worst case causing accidents.