62% of Auto Execs Believe Blockchain Will Disrupt Industry within 3 Years: IBM Study
The auto industry is betting big on blockchain. In fact, a whopping 62% of auto executives say the technology underpinning bitcoin will be a disruptive force in the industry by 2021.
Moreover, 95% of carmakers plan to make “moderate to significant” blockchain investments over the next three years, according to a report by the IBM Institute for Business Value, a business-research group.
In its executive report entitled “Daring to Be First,” the IBM Institute says blockchain can revolutionize the auto industry by bringing transparency to supply chain management and financial transactions.
Auto Industry Invests in Blockchain
Here are some key findings:
- 62% of executives say blockchain will be a disruptive force in the industry within 3 years.
- 54% expect new business models to influence investments in blockchain.
- 54% of executives will implement their first commercial blockchain network at scale within 3 years.
Industry leaders believe that the ingenuity of distributed ledger systems will bolster the use of smart contracts, which are self-executing, self-enforcing contracts.
“Thousands of parts go into the assembly of a vehicle,” the IBM report noted. “The inability to track and verify the parts can result in parts that do not work properly when they are integrated with others. Performance issues and customer dissatisfaction can then occur.”
Auto executives are counting on the blockchain promise of secure, traceable transactions and improved transparency of information to streamline supply chain management.
The IBM Institute pointed out that German auto giant Porsche has been testing blockchain applications in its vehicles since February 2018.
As CCN reported, Porsche has been developing blockchain applications to park cars, lock and unlock vehicles, and make loaning out a company car to an employee easier.
Because all transactions are recorded on a distributed ledger, car owners would be able to monitor who used their vehicle and when. This could play a major factor in expanding the “sharing” economy that has skyrocketed during the past few years.