You might imagine that car manufacturers only or mostly make their money through car sales — and that’s perfectly logical. But in the digital age, they’ve got far more options to make a buck.
DLT will create new potential revenue streams for manufacturers while adding a crucial layer of integrity to what is becoming an increasingly digitally-focused industry.
Change is happening at an unprecedented rate across all industries and that’s largely due to all the new tech being developed. The automotive industry seems to be sucking in all kinds of emerging technologies and spitting out radical new ideas and concepts at an incredible rate.
The rise of Distributed Ledger Technology will only add fuel to the flames. In this article we’ll build on other topics covered in this series by shedding light on where and how blockchain-related automotive services could possibly be accessed by consumers and what that may mean for manufacturers.
How it all started
Technological leaps forward for cars have historically been slow. Rewind back to 1911, and automobile companies had only just begun installing electric starters into vehicles, followed by cigarette lighters in 1925, radio in 1930, power steering in 1956, the cassette deck in 1970, and air bags in 1984.
Things started getting fancy the following year, starting with CD players in 1985, dashboard computers in 1994, and GPS navigation systems in 1995.
The focus then shifted to connectivity in the 2000s. A recent AT&T and Ericsson survey revealed that approximately 62% of US consumers are aware of the term ‘connected cars’, and consumer interest in connected cars is growing.
Modern vehicles are defining an exciting future for the automotive industry, but while all these technological developments are great news for consumers, they also add a considerable degree of complexity to what was once a relatively simple machine.
Service comes first
Many of us may be unaware, but the main source of revenue for car manufacturers has shifted and continues to shift away from the car itself, towards the services built into and around them.
In fact, many believe using unit sales to determine market share is an outdated process. What this means is that not only do modern, connected cars generate more revenue initially, they continue to do so over their entire lifecycle.
This shift now means that the value of a customer has taken on another dimension. The services a customer makes use of as well as the data they use, need and create is now a core focal point. As blockchain technology begins to merge with connected cars we could begin to see further diversification of manufacturer’s potential revenue streams.
Blockchain enabled marketplaces will allow companies to offer a range of services directly to the consumer, from repairs through to all kinds of customised services. Here‘s what we can expect from these car marketplaces:
- Car Passports: The entire car history could be put on the blockchain, including title transfers, vehicle tracking, retailing and leasing, as well as insurance. This digital identity can then be used on marketplaces to acquire products, avail services or even buy and sell secondhand cars.
- Tailored individual options: Companies will be able to provide personalised services to car owners, all at reasonable prices.
- Repair: Car owners can determine the need to replace consumables using insights about past replacements and vehicle usage. They will also be able to locate authorised and reliable service stations and read reviews and feedback from others as a marketplace service.
- Spare parts: Owners can not only authenticate the spare parts for their vehicles using the reliability that blockchain offers, but companies will have the option of putting up the technical readouts of car parts that can be 3D printed on location, offered through the marketplace.
- Vehicle data: The permeance and accessibility of the vehicle information in these marketplaces will establish trust between the different parties in the ecosystem.
The connected smart cars of the future will generate unforeseen amount of data. Data producers will want to turn their information into public assets that not only help create better products, but improved services and experiences. Marketplaces will serve as platforms that benefit both consumers and manufacturers.
Cars will soon be a seamless extension of their owner’s lifestyle, while manufacturers and service providers will be able to deliver superior brand experiences by targeting and optimising their services.
Secure information exchange
Automakers have been looking at the blockchain for consolidating information. The current method is spread across different information systems by car manufacturers, insurers, and repair shops, which store information about customers and their vehicles.
Distributed ledgers can be used to create decentralised platforms on the blockchain serving as marketplaces that will help people buy and sell vehicles and vehicle related services in a transparent, secure and trustworthy manner.
All participants in these marketplaces become stakeholders in the automobile industry and can partake simultaneously as data producers and consumers in a cycle of value sharing and creation. Car data therefore becomes a public asset. And cars, moving hubs of information.