More than 4 trillion consumer products are made, shipped and retailed globally every year. Yet end-to-end traceability of each item through its life cycle journey – from manufacturing to the consumer to recycling, resale or disposal – is, for the vast majority of goods, a black hole of insight. Every information is largely siloed within each supply chain player’s organization, making it hard to follow the custody of every item across its life cycle.
Today, Teleport (the logistics arm of AirAsia airline) has launched a blockchain-based digital cargo booking system called Freightchain.
According to the announcement, Freightchain is “the world’s first digital air cargo network run on blockchain.” The network allows shippers or freight forwarders to instantly book and confirm any of AirAsia’s 247 aircraft to carry cargo.
The first pilot booking on Freightchain involved the shipment of pharmaceutical cargo from Bengaluru in India to Ulaanbaatar in Mongolia. An instant itinerary via Kuala Lumpur, Malaysia, and Seoul, South Korea, was confirmed in real-time with flights from three different carriers through a smart contract on blockchain.
Freightchain assigns shippers and their freight forwarders to cargo connections to help them with their supply chain needs, and facilitate bookings in real-time which are processed on-chain.
“We deliberately launched Freightchain during this period of uncertainty within global supply chains, caused by the coronavirus pandemic. Agile software platforms like Freightchain help to connect uneven supply and demand amidst a rapidly evolving environment. Trust and transparency are needed now more than ever.” – Freightchain CTO, Vishal Batra
The booking was confirmed in real-time with flights from three different carriers through a blockchain smart contract. In a traditional system, the shipper would need to manually inquire about the availability of connecting flights with multiple airlines and agents. This requires a lot of time spent on phone calls and emails. In comparison to the traditional system, the new system offers higher efficiency when it comes to both the amount of work needed and the speed of execution:
“Freightchain simplified the booking process and confirmed the itinerary 10 times faster for shippers by programmatically discovering the available routes with connecting flights within the shipper’s budget and passing on significant cost savings to shippers.
The availability of a shared ledger like the one offered by blockchain technology is a much-needed innovation to help manage the complexity of modern logistics. Blockchain technology can, and is much needed to help with the global supply chain challenges. Digitising is not simply a matter of cost, but primarily of visibility and managing supply chain risk. To limit the impact of points of failure in the value chain, it is important to make data available through digital means.
Meanwhile, the adoption of blockchain in the logistics industry is proceeding at a rapidly increasing pace.