Tesla, the $700 billion electric vehicle manufacturer, is using blockchain to trace cobalt and nickel in a pilot project that is being implemented across its supply chain.
Glencore, an Anglo-Swiss commodity trading and mining company with yearly revenue of $142 billion, revealed Tesla is collaborating with Re|Source, which provides blockchain tracing “from the mine to the electric vehicle.” According to Glencore:
“The pilot is being tested in real-world conditions, from upstream cobalt production facilities in the Democratic Republic of the Congo (DRC) to downstream electric vehicle manufacturing facilities.
Multiple on-site pilots have already begun in the DRC and Europe, with plans to launch additional pilots in Asia and the United States later this year.
The final pilot across the entire Tesla supply chain is scheduled for Q4 of this year. The final industry solution is expected to be released in 2022, with support from Kryha, a boutique block-chain technology studio.”
We asked Kryha for more information on what blockchain is being used, whether it is ethereum-based or not, and will update once we receive a response.
Tesla describes the project as “creating a blockchain platform by creating a transparent, open, and global registry that aims to ensure that all cobalt used in end-products is sustainably sourced and users can account for and verify the provenance of each unit…”
When completed, the system will allow users to fully track cobalt from the mine to the battery, ensuring that the volume of traceable material, as well as the sustainability efforts of upstream suppliers, are understood.
This solution will be tested in real-world settings, beginning with cobalt production sites in the Democratic Republic of the Congo and progressing to electric vehicle production sites.
Tesla is taking part in this pilot program, which is set to run until the end of 2021. The platform will be fully operational in 2022.”
Tesla also revealed that they are working with BHP on a blockchain pilot program to trace nickel. According to Tesla:
“Over a three-month period, we followed nickel shipments from BHP’s Nickel West operations in Western Australia through the various transformation stages, all the way to vehicle production at Gigafactory Shanghai…
The digital nature of blockchain enables scalability of the technology, and CO2 tracking validates the environmental footprint of Tesla’s vehicles, allowing the supply chain to adjust its long-term emission-minimization strategies and leverage them in day-to-day operations.
These will be included in critical disclosures that will eventually be included in an environmental battery passport and future EU battery regulation. The pilot also allowed us to identify potential inefficiencies in supply chains and recommend ways to improve them.”
Blockchain technology is increasingly being used in supply chains due to its ability to create an instantly shared immutable record of entered data, allowing for increased collaboration between distinct entities such as the employee on the ground, the office worker or supervisor, the regulator, and other participants.
The solution does not guarantee the accuracy of entered data, which still requires manual supervision and quality control, but it prevents data tampering once it is entered into the system and allows for data sharing with end-users.
Tesla began developing a blockchain solution in 2019, and it is now testing it on the ground as the company strives to provide customers with a fully transparent record of the minerals that go into Tesla vehicles.