Innovative Blockchain Tech; Sita, an air transport communications and information tech company, and ULD Care, a trade association, are exploring the possibility of using blockchain technology to save $400M a year in the air cargo industry, according to the March 12 announcement.
Blockchain platform brings down cost and improves efficiency
Blockchain technology allows air cargo companies to digitally track and record the change of custody for airline cargo containers, or Unit Load Devices (ULDs), as they journey between destinations. These companies aim to bring down industry costs, improve efficiency, drive fewer losses, and prevent damage to cargo.
The proposed blockchain platform will also embed authentication and trust-based functions to reduce the risk of tampering, cybercrime, trade-based money laundering, fraud, and illicit trade. Bob Rogers, vice president and treasurer of ULD Care, added that:
“A container travelling from Shanghai to Long Beach could take up to 30 days to finish its journey, but the true travel time on sea or road is only around 15 days, with the remaining time spent on back-office and paperwork. The use of blockchain could revolutionize that process.”
Blockchain provides a solution for common challenges
Currently, there are up to 12 custodian companies monitoring and tracking the cargo for any given shipments, according to the announcement. Most of these companies depend on paper documents. This makes the process complicated and causes frequent trust and transparency issues.
Blockchains, however, save time and cost, and can address many of the air cargo industry’s pain points. Matthys Serfontein, president of Air Travel Solutions for Sita, said that:
“We are looking at blockchain very closely and we’re excited to test the potential of the technology to transform the air cargo industry.”
Mathys also pointed out that blockchain’s potential goes way beyond cargo, and could solve common airline challenges in general.
Different industries are exploring blockchain technology in logistics
Cointelegraph reported previously that IBM Indonesia has joined TradeLens’s blockchain-based shipping platform. A recent report also shows there are 25 leading pharmaceutical manufacturers, distributors, logistic partners, and other representatives of the pharma supply chain who are in favor of adopting blockchain technology to track and trace prescription drugs after completing a pilot program with the US Food and Drug Administration.