Automotive Blockchain Industry To See $4.1B Market Cap By 2032 Amid Rising Adoption Metrics And Technological Advancements

Blockchain technology has come a long way, from its humble beginnings in 2009 to hogging the spotlight in recent years. Although the emerging technology

Emerging from its 2009 debut to hogging the spotlight in recent years, blockchain technology has taken a backseat to artificial intelligence (AI) in recent years; however, blockchain use cases in the automobile sector are set to reach new highs.

A report by Global Market Insights now reveals that the automotive blockchain industry could witness a substantial increase in market capitalization amid rising adoption metrics and technological advancements.

In 2023, the industry is valued at a little over $550 million, but the combination of several factors is set to propel the market size to $4.1 billion by 2032. This giant leap will be at a compound annual growth rate (CAGR) of 25% over eight years, driven by a range of market trends.

According to the report, use cases around improving supply chain efficiency will contribute significantly to the industry's market growth. Early adopters are using blockchain for “real-time tracking and vehicle authentication,” ensuring the provenance of parts to curb counterfeits.

One example is German car manufacturer BMW (NASDAQ:BMWYY), which used blockchain to track the cobalt in its electric vehicle batteries from mining to final application. A 2019 company report highlighted how blockchain’s inherent transparency and immutability contributed to ensuring compliance and “building stakeholder trust.”

Toyota (NASDAQ:TM) has also joined the effort, tracking spare parts with blockchain and achieving relative success, paving the way for advanced supply chain applications in the future. The report anticipates a spike in the use of smart contracts in the industry to eliminate third parties in transactions while boosting speed and transparency.

“These smart contracts minimize administrative expenses and increase transaction speed and transparency by automating payment settlements according to preset parameters,” the report stated.

The report predicts that the mobility segment will be the biggest driver of this spike, with commercial mobility leading the segment. Recent advances in smart city projects could see the mobility segment contribute up to $2 billion by the end of 2032.

Uneven regional distribution

The report indicates that North America, especially the U.S., has a clear lead in the industry, boasting a market share of nearly 35%. This lead is perhaps unsurprising, considering the continuous capital injections by institutional investors, progressive policies, and support from regulators compared to other regions.

Outside of North America, Asia ranks second, buoyed by advances in China's automobile industry in areas of supply chain and smart contract utilization. Japan is also on a similar path with Toyota, Honda (NASDAQ:HMC), and Nissan (NASDAQ:NSANY) contributing to the growth of the ecosystem.

Watch: Reviving the true value of blockchain—utility

New to blockchain? Head over to CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.

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