BMW Test Drives Blockchain for Car Mileage Tracking

Global auto giant BMW is piloting a blockchain platform to track mileage in leased vehicles through its startup innovation program.

DOVU was one of five startups to work with BMW Group UK as part of the company's Innovation Lab, first unveiled back in February.

Specifically, DOVU developed a system with Alphabet - BMW's fleet manager - to incentivize drivers to log mileage in leased or borrowed vehicles.

The idea is that the system helps BMW understand how much activity its vehicles are seeing and the impact on them, DOVU head of product Alex Morris explained.

"What we're doing is we're essentially trying to build out this circular economy on the DOVU platform. [Drivers] can earn tokens, but down the line they'll also be able to spend tokens on services - for example, they might be able to get replacement tires or something like that using the Dovu ecosystem. The partner, in this case BMW, defined the categorization of the reward and that's defined in a smart contract. As long as the parameters are met for the smart contract, they'll receive tokens."

BMW chose to define the parameters for token rewards through mileage - the current automatic mileage tracking systems are unreliable, Morris said, and do not provide the information that the company might actually use.

As a result, the pilot program requires drivers of leased or borrowed vehicles to log their mileage weekly, which gets stored on DOVU's blockchain.

"Right now mileage is the most important factor for the resale value of their vehicles," he said.

Ultimately "The plan is to become this kind of ubiquitous rewards system that can work across vehicles, make some kind of unified wallet for token rewards that you can use on your BMW, but maybe jump into your second car and earn more tokens and then spend those throughout the ecosystem," according to Morris.

The project comes months after DOVU - previously backed by Jaguar's venture arm - completed a $6 million initial coin offering.