Blockchain in Aviation: Introduction
Blockchain in aviation is a digital journal of transactions that store accounts each time a part is installed or removed from an aircraft. Blockchain technology provides a real-time portrait of conditions from the assembly line to the retirement of the fleet.
The blockchain in aviation market is driven by the capability to simplify and ensure smoother and efficient operations that leads to reduction in complexities and cost savings. The improved passenger experience, reduction in maintenance cost, reduction in transactional complexities, and increased transparency & traceability of operations are some of the factors propelling the market growth.
Blockchain technology is supporting the aviation sector to have a well-connected and transparent supply chain. The requirement of this technology in the aviation sector is due to the presence of large, complex supply chains that further supports the industry growth.
In recent years, aircraft Maintenance, Repair, and Overhaul (MRO) providers, airline carriers, and aircraft manufacturers have announced plans to implement initiatives and research programs that use blockchain technology - from the replacement of parts on in-service airplanes and handling the purchase of flight tickets.
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Industry participants are working closely with airport authorities for the implementation and integration of blockchain technology and update industry players regarding the upcoming technologies in the aviation sector.
Blockchain technology can help in ensuring a superior and efficient supply chain due to the complex supply chain management in this sector. This is one of the prime reasons for using blockchain technology that is likely to propel the market revenue over the forecasted timeframe.
Increasing adoption of evolving and developing technologies by aircraft carriers and airports is expected to significantly support market growth over the coming years. For instance, in November 2018, Boeing announced a strategic partnership with SparkCognition that plans to launch SkyGrid, which is likely to qualify the future of urban aerial mobility. This partnership plans to build a blockchain-powered and artificial intelligence airspace management platform software.
Impact of COVID-19 on the Global Blockchain in Aviation Market
The rapid spread of Covid-19 across the globe and the huge death toll resulting in lockdowns and border closures devastated the demand for travel worldwide. The global travel sector has seen decline due to government restrictions on travel, changes in passenger behavior, and the broad economic downturn globally.
Global MRO spending by large commercial aircrafts and thus aftermarket revenues for suppliers engaged in the aviation sector is foreseen to crash by approximately 50%-70% in the year 2020.