German Automaker BMW Launches Blockchain System to Track Supply Chain of Auto Parts

German Automaker BMW Launches Blockchain System to Track Supply Chain of Auto Parts
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Popular luxury car manufacturer BMW Group has announced a new blockchain project that it plans to roll out later this year to track the delivery of automobile parts for at least 10 of its suppliers.

A press release published by the company on Tuesday, March 31st revealed that the new blockchain-based supply chain management system will be dubbed PartChain – a reference to the fact that it tracks BMW vehicle parts through the supply chain.

According to the press release, BMW Group revealed that it had completed a beta version test of the efficiency of PartChain which was done in 2019. The test phase involved tracking of front lighting parts both from the suppliers as well as the delivery to the end-user.

BMW Group aims at ensuring complete transparency and traceability of its automotive parts across its massive supply chain across the globe. The automotive industry is predominantly filled with supply chain issues which leads to negative customer experiences for manufacturers such as BMW whose goal is to maximize that experience.

The market is filled with fake automotive parts which often undercut the genuine parts in terms of price and ease of availability which are important factors for vehicle ownership, especially in emerging markets.

Another pain point that BMW seeks to address with the launch of the PartChain SCM is the coordination and integration of different parties’ systems. This is in reference to the different companies involved in the supply chain whose systems are not able to be linked or integrated. Sometimes, the hustle of integrating two systems could be too high that the companies chose not to link their systems.

“The BMW Group initiated the PartChain project to ensure seamless traceability of components – more or less “at the push of a button” – and provide immediate data transparency in complex supply chains for all partners involved going forward,” the company statement reads.

Andreas Wendt, a member of the Board of Management of BMW AG responsible for Purchasing and Supplier Network said that following the successful conclusion of the 2019 testing phase, the company will now “expand the project to a large number of other suppliers.”

He added that this move is “designed to take the digitalization of purchasing at the BMW Group to the next level. Our vision is to create an open platform that will allow data within supply chains to be exchanged and shared safely and anonymized across the industry.”

The PartChain system runs atop cloud computing platforms such as Amazon Web Services and Azure Cloud Services. This will ensure that the system maintains flawless operation and uptime as more suppliers are added to the system.

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