How Blockchain Transforms the Aviation Industry

The nature of the airline industry and transportation system, in general, overlap a lot with the capabilities of blockchain technology. It might include Intensive data sharing between several parties and touchpoints of the journey, multiple flying routes, destinations, luggage, identity, insurance to immigration, and more. Each touchpoint of the whole system requires accurate and in-time data collection; thus, an immense net of data collection and analysis is being processed constantly with every single flight. This requirement is where blockchain development fits in to ramp up the aviation industry’s capabilities. And the potentiality does not stay within data work but expands to so many more. Let’s dig in and discover the four ultimate use cases of blockchain in the aviation industry.

1. Ticketing Management

The day when passengers board their planes with printed paper tickets is soon gone in the near future. It is now an e-ticket that does the job effortlessly. The passengers’ booking information scraped from various data pools will be entered and centralized in massive storage, then called up upon checking in automatically. Despite eliminating the hassles of unnecessary manual work, the electronic ticketing system has been going underperforming as the data has ballooned massively throughout the years and causing severe problems to both airlines and passengers.

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The day when passengers board their planes with printed paper tickets is soon gone in the near future.

Looking at a specific case of a well-established airline, Southwest Airlines, which has been quite well-regarded for its services and accountability, had some mishap. However, in July 2016, passengers of these airlines found themselves unable to board the flight unless they had their paper tickets printed. The reason was the failure in Southwest’s central ticket database, which led to the cancellation of 2000 flights. The database melt-down cost Southwest an $82-million revenue loss as well as its reputation. SITA – the world’s largest telecommunication and IT service for the airport industry, stated in its report that recovering and returning lost luggage cost the aviation industry $2.1 billion in 2016.

However, things are changing with the birth of blockchain. Blockchain development in the airline industry would allow the tokenization of tickets or smart tickets, which means that companies can encode terms and business logic into the block on purchasing and using the tickets. Token tickets would also open up doors for passengers to buy tickets from various retailers across the world regardless of location or currency used. As blockchain is a decentralized public ledger, there would be no single central crash that could destroy the whole system.

What’s more… With the current system, for every ticket sold, airlines have to go through various intermediaries such as travel agencies, post offices, banks, etc. to collect customers’ identities and revenue generated. By applying blockchain technology to the system, all details regarding the purchase of a ticket can be logged into the chains immediately and accurately. As every purchase would be recorded on a separate chain and the data, once verified, cannot be altered or deleted, airlines can easily keep track and recall information once in need.

2. Customers Loyalty Programme

The first flyer loyalty program was introduced by American Airlines back in 1981; from then to now, brand loyalty and customer engagement have become extremely vital for all commercial airlines. “Frequent flyer miles” is not a new term in the airline industry, as a substitute for loyal customers reward programs. However, the success level of this program from different airlines can vary widely. While some major airlines are doing a great job with their “frequent flyer miles” such as Jetblue Airways Trueblue or Alaska Airlines Mileage Plan, ranked by Forbes as the best Frequent Flyer Miles programs in 2018, many other airlines find themselves lost in the search for the best customer loyalty program.

Redeeming frequent miles in exchange for free flight tickets might sound extremely attractive and profitable; however, in reality, customers have more than often reported their difficulties in redeeming these miles due to a lack of seat availability or the requirements for extra costs of the redeeming process. Another issue that airlines would have to deal with is the variety of destination options as well as service choices.

The technological advances in blockchain have now come to the rescue. It would enable a stable and robust platform, which integrates revenue-sharing, point allocation, and automated point-redeeming between customers and partner airlines to facilitate the joint reward program between various airlines. This solution would benefit both customers and the airlines themselves. The system centralized would tackle fewer misalignments of information. This shall save enterprises billions of dollars and enhancing their reputation within the industry. Meanwhile, passengers would be able to effortlessly use the airline’s loyalty program anywhere, anytime, promoting a seamless traveling experience.

3. Maintenance Logs

Blockchain development can transform aircraft maintenance records, which should never be recorded manually on paper. As aircraft maintenance is a highly crucial process to ensure the airlines’ functionality and the safety of passengers, all maintenance information should be handled carefully and adequately.

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Aircraft maintenance is a highly crucial process to ensure the airlines’ functionality.

Blockchain, like distributed ledgers, can ensure that all engines attained are legitimate and offer an immutable digital entry of each maintenance on every part of the plane, regarding when it is done, by whom, and what is the ending state. Real-time configuration and maintenance data would allow operators to predict the condition and lifespan of different engines, and ultimately, the entire aircraft. Having access to accurate and in-time data would help airlines manage their logistics and financial details better.

Blockchain technology has great potential in transforming the aviation industry. The deployment of this new technology would bring in greater efficiency, minimize financial loss for airlines while significantly improve customers’ experience and increase their loyalty towards the brands. Before realizing these benefits, companies, and enterprises would have to resolve several technical and management challenges; however, the promising profits would be worth taking in new challenges.

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