Air Industry Eyes £300m Saving Via Blockchain Technology For Cargo Efficiency!
The air industry’s continued investigation into how blockchain can enhance effectiveness has uncovered more than £300m of potential savings by utilizing the technology to track and record cargo as it shifts hands on its journey from producer to consumer.
An association of air transport companies, recognized as the Global Blockchain Alliance, spearheaded by industry-owned IT supplier SITA, is recently studying at different applications for blockchain in the sector. The association was created to initially examine the utilization of blockchain to control the logistics connected with aircraft parts.
The latest idea to digitally trace cargo containers stems from work between air logistics trade association ULD Care and SITA. Unit load devices (ULDs) are pallets or containers that transport cargo on aircraft. Approximately 800 million of them are employed by airlines across the globe, though current tracking systems are only partly digitized.
The plan is to utilize the blockchain to track these ULDs and record which organization has taken custody of them throughout their entire journey. The recent digital platform adopted by airlines has limits to visibility because it does not allow third-parties like handling companies’ access. However, this will change on the blockchain platform by the use of APIs (application programming interfaces).
Data will be input to a blockchain-based platform at various points on the cargo’s journey. This will provide all trusted stakeholders, real-time visibility of where it is. The plan will decrease costs and manual processes. The platform will be capable of identifying where damage or loss happened, which will decrease the time and cost linked with conflicts in different companies in the logistics chain.
Air cargo describes only 1% of all global trade in terms of volume. Still, it accounts for 35% of the total trade value, and the incompetence is vital, according to Bob Rogers, vice-president at ULD Care, who stated cargo takes longer because it is stalled down by manual back-office processes.
Although blockchain is best known in the financial services sector for its role in allowing bitcoin to become a reality, the DLT is also being employed to enhance logistics in various sectors. It can trace and track the chain of custody within different parts of a supply chain. Because everyone in the supply chain can see and trust the transactions posted, blockchain can decrease the time needed for reconciliation and facilitate faster processes.
For instance, IBM and Danish shipping giant Maersk are utilizing blockchain to digitize transactions in the global shipping industry, which is a vast market, with approximately 90% of the world’s trade transported by sea.
They have employed the technology to allow the transparent and real-time exchange of supply chain events and documents. Each participant in the trade can observe the progress of goods by the supply chain – including the status of customs documents, bills, and other data – however, no one can transform or delete records without the consensus of others in the network.
Furthermore, in 2018, Accenture and DHL finished a proof of concept for blockchain’s application in the pharmaceutical supplies sector.
The project observed the companies utilize the technology to track pharmaceuticals from their manufacture to their prescription to patients. This is significant because, according to Interpol, approximately one million people die each year because of forged medication, which makes up about 30% of pharmaceutical products traded in emerging markets.