Analysis

Volkswagen Group has announced it will use blockchain tech to track its mineral supply chains.

The German automaker said Thursday that, in order to “responsibly source” minerals such as cobalt (used in lithium-ion batteries for electric vehicles), it has joined an open industry collaboration, which also includes Ford as a member.

Currently, miners and consumer brands rely on third-party audits and “laborious” manual processes to comply with widely accepted industry standards for sourcing their minerals, VW said.

Using blockchain technology to track supply chains will help the firm meet responsible sourcing standards set out by the Organization for Economic Cooperation and Development (OECD) by providing a permanent record of mineral movements to aid the compliance process.

For the effort, VW will use a new permissioned platform, developed by the group on IBM Blockchain – which is built using Hyperledger Fabric – to enable the tracking of minerals across the global supply chain.

The collaboration, formed earlier this year, also includes as members cobalt mining company Huayou, LG Chem (a unit of South Korean conglomerate LG Corp.) and raw materials supply chain auditing firm RCS Global.

VW said in its announcement:

“Participants in the network, validated by RCS Global Group for compliance with responsible sourcing standards, can contribute and access immutable data in a secure and permissioned way to trace and record the flow of minerals across the supply chain in near real-time.”

The automaker further said that the group aims to expand membership to include other industries, including aerospace, consumer electronics and mining operations.

Volkswagen image via Shutterstock

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