Daimler will use a blockchain platform to track the value of used cars in real time
- This is an excerpt from a story delivered exclusively to Business Insider Intelligence Transportation & Logistics Briefing subscribers.
- To receive the full story plus other insights each morning, click here.
Beijing Mercedes-Benz Sales Service (BMBS), an automotive sales joint venture between German automaker Daimler and Chinese automaker BAIC Motor, will use a blockchain platform to track used car value in real time, according to FreightWaves.
BMBS will use a blockchain platform developed by PlatOn, which sends real-time vehicle data to approved recipients to share static and dynamic vehicle data with approved local dealerships, vehicle inspectors, and used car owners, per CoinTelegraph.
In turn, this could help BMBS increase buyer confidence in its used car inventory, as it can provide more granular data on car history and adjust the price accordingly. Ultimately, it could bolster BMBS's share of China's growing used car market, which comprised 14 million unit sales in 2018.
The used car platform is one of several blockchain applications being tested by Daimler. As a decentralized ledger, blockchain technology allows for the transfer of data throughout a network. The technology has a broad range of potential use cases, and Daimler has notably attempted the following:
- Blockchain in supply chain. In February 2019, Daimler announced a partnership with enterprise contract software company Icertis to implement blockchain in its supply chain. Daimler intended to use blockchain to keep track of whether suppliers were meeting the control standards it requires from suppliers, particularly surrounding working conditions and ethics standards.
- Blockchain in payments. In August 2019, Daimler developed a pilot payment solution for charging its electric trucks, in collaboration with German bank Commerzbank, according to FreightWaves. The solution makes it such that a blockchain ledger can track and facilitate an electric charging transaction, allowing payment to be made without human verification. Commerzbank stated that the pilot could pave the way for more automation in the trucking space, including "both the loading and the subsequent payment process" to "proceed completely autonomously and without human intervention."
The bigger picture: Returns on blockchain investments will not materialize if firms fail to get out of the proof-of-concept stage, which has proved to be difficult.
While Daimler and a number of other automakers - including BMW, Renault, GM, and Ford - examine how blockchain technology can positively impact their industry and respective businesses, much of this is still in the exploratory stages. Many industries are taking a cautious approach to blockchain implementation: A survey of 447 organizations by Capgemeni Research Institute found that 87% of respondents were only on the proof-of-concept stage, while just 3% had actually implemented a blockchain solution at scale.
One way automakers can make greater progress is by focusing on evolving their business practices and adding blockchain specialists who understand what is needed to bring a solution to scale within an organization. Deloitte estimates that 80% of blockchain adoption is about changing business practices, while only 20% is about implementing the technology itself.
Interested in getting the full story? Here are three ways to get access:
- Sign up for the Transportation & Logistics Briefing to get it delivered to your inbox 4x a week. >> Get Started
- Subscribe to a Premium pass to Business Insider Intelligence and gain immediate access to the Transportation & Logistics Briefing, plus more than 250 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now
- Current subscribers can read the full briefing here.