Blockchain in the trade of aircraft components

Honeywell has announced that it is launching its new and used aviation component by buying and selling online platform. Not only are online transactions extremely rare in this sector, but Honeywell also does something unusual: using blockchain technology. "Now less than 2.5% of all transactions are made online in this place" says Lisa Butters, who leads the aerospace company Honeywell. "We are the first market to enable custom-seller stores and we are the first to take advantage of blockchain technology to create trust between buyer and seller".

Reason for the adoption of the blockchain

Customers need a way to ensure that the parts received are genuine, that the best prices are obtained and safe from scams and potential problems. They are able to accurately track the parts with blockchain, ensuring that the images and quality documentation are accompanied and that they are immediately available for sale and shipment. It seems as if now, Honeywell has decided to try the new platform.

The concerns are legitimate

According to Deloitte, aircraft maintenance is a process that makes best use of cumbersome databases and, in the worst case, a paper system. Used for a maximum of 30 years, a commercial aircraft may have seen four to five owners. Therefore, it becomes a difficult and error-prone process to track information (especially maintenance documents) and pass them on to other parties.

Blockchain creates an immutable record of an aircraft that preserves the history, details and timestamp it has performed such as inspections and when. This also has another side effect, which is equally important.

In 2015, American Airlines was charged with maintenance fraud by the Fed Aviation Administration. The mechanics who work in American Airlines have reported the problem, noting "Differences in aviation maintenance in accordance with the Federal Aviation Handbooks, Procedures and Regulations Required". The probabilities of such deviations could be minimal (if not eliminated) if a blockchain technology was adopted.

Although blockchain can solve some of the problems, its strength and weakness are certain. According to Aeron's CEO, Artem Orange: In the aviation sector there is a wide range of rules that leave little room for possible violations, so we can say that even without the blockchain technology, the whole industry aeronautics is very efficient and safe. He continues it "The examples of Aeron and Honeywell show, however, that there are some applications outside of where the blockchain is effective and provides solutions to real problems."

Blockchain and aviation

The aviation industry has enormous potential for breaking the blockchain due to the number of problems. Blockchain technology is the ideal reliable and decentralized solution to allow all parties to connect and coordinate. In fact, an Accenture report predicts that by 2021 the blockchain will be used by more than 85% of the airlines and defense companies.

On July 16, Accenture announced that it will use blockchain technology to provide suppliers, producers and partnerships with a unique shared view of the supply chain. The following day, Boeing announced a partnership with SparkCognition a "Uses artificial intelligence and blockchain technologies to track air traffic in flights and allocate routes and corridors to ensure safe and secure transportation."

In the past, Air New Zealand has partnered with Winding Tree to improve baggage booking and tracking services through blockchain and Lufthansa in partnership with the huge SAP flight booking software, loyalty and supply chains.

The use of the blockchain obviously reduces costs substantially, because intermediaries that sometimes charge up to 25% are removed. Banks are also excluded, reducing not only the related costs, but also speeding up the procedure and providing immediate payments and commissions.

Finally, blockchain can be used for security and identity, where it not only offers a unified way of verifying the identity of passengers, but also a very secure system that allows users to monitor, to what extent and who has access to their data.

Aeron has an interesting case, not for passengers but for drivers. This function is applied. Pilot flight time on the blockchain is tracked in Aeron's application logs and the system aims to track global aircraft and flight school data that could otherwise easily be falsified. This is a valid concern in view of the fatal accidents in which the pilots flew without a license.

Trends of 2019

Blockchain downtime in 2018 is still ongoing, but slowly but surely. "Airplanes are one of the most regulated areas of human activities" said Artem Orange. "It may be difficult for blockchains to enter the aviation sector, but it is a field that can radically upset the common leader – both for passengers and for pilots and guilds." The new technologies introduced require long cycles of review and approval. "