Over 28 million vehicles were recalled in the year 2017. As high as that number seems, it was actually higher in 2016 at 52 million vehicles recalled.
The number of recalls had to due to with a defect in Takata airbags and their inflators. The airbags would shoot out metal with the airbag when deployed. Automotive makers are now saying that blockchain tracking systems can help by solving some issues around recalls, fake products, and consumer safety.
Although the Blockchain can’t help with all aspects of the car industry, it will help to alleviate the damage when people do have problems with their cars.
Blockchain is helping to protect buyers from counterfeit parts as well as accidents from defective parts. Counterfeit parts are part of a $45 billion dollar problem across the globe. Yet very few manufacturers have adequate end-to-end visibility of parts entering and leaving their supply chain. Most do not have visibility beyond their immediate vendor, making an ideal environment for the counterfeit market.
Airbags, filters, brake pads, and radiators are common counterfeit parts, and has major safety concerns for consumers. Accidents are more prone to happening with fake parts installed on vehicles. Blockchain is able to eliminate most counterfeit parts out of the supply chain. When parts are registered on the blockchain, companies can easily trace their provenance, create record transactions, and track changes in custody. Hypothetically, if a shipment of brake pads isn’t registered or proven authentic on the blockchain, a manufacturer can know that the parts are unusable when receiving inventory. Thus, these parts won’t be installed into new cars.
Another way that Blockchain can help automotive companies is that it’s able to pinpoint which vehicles need to be recalled. This alleviates the need for automakers to overcompensate to protect consumers. Recalls cost automakers around $22 billion in 2016, and this would help them to better save money. With a blockchain-based system, it’s easier to track and trace parts from their source, all the way down to individual vehicles. If a faulty product is coming from one supplier’s factory, like Takata’s, that problem can be pinpointed in the supply chain.
As cars become more automated, control of the vehicle will begin to shift from the driver to automation. Auto-park features, blind spot monitoring and automatic braking are the beginning of this process. Because of this, the integrity of electronics and software inside the car is crucial.
If individuals are going to place their trust in the technology of their car, people have to know the sensors and computers in their vehicles are working correctly—every single time. Which is another reason why it’s highly important to eliminate faulty and fake products.
Ultimately, blockchain solutions will allow for automakers to find out where the failures are and quickly alert owners when there’s an issue. It works for both seller and consumer, and equally keeps users more safe on the road.