Yesterday, Alfa Romeo revealed its newest Tonale SUV – the “first car on the market” coming with an NFT digital certificate. Actually, the Italian carmaker claims that it is a pioneer in connecting each vehicle to its own blockchain-based token. The technology, the company says in a press release, is based on the ‘blockchain card’ concept, a private and non-changeable record of the main stages in the lifespan of a vehicle.
How does the Tonale NFT work?
According to information from Alfa Romeo, the NFT certifies a car when it is purchased and during its life cycle records and stores vehicle-related data. This, the automaker claims, would raise the car’s residual value as when it is time to sell your vehicle, you can give the prospective buyers a clear proof that the car has been properly serviced.
“Upon customer’s consent, the NFT will record vehicle data, generating a certificate that can be used as a guarantee of the car’s overall status, with a positive impact on its residual value. On the pre-owned car market, NFT certification represents an additional source of credibility for owners or dealers to count on. In the meantime, buyers will be reassured in their choice of a second-hand car,” says Alfa Romeo in a press release.
Scarce information, however, is available about this technology yet. We do not even know the network Alfa Romeo would use to store the information.
However, what is the value-added of this technology, especially for the consumers?
Actually, for decades manufacturers have been keeping detailed information about the history of any car through the vehicle identification numbers (VINs) system, which does not rely on blockchain and is therefore less energy-intensive. Sometimes, however, this data is not made available to used cars’ buyers, especially when multiple owners are involved. Probably, this is the major advantage of the NFT technology Alfa Romeo introduced. An important condition is that the car must be serviced by a certified Alfa Romeo dealer to record the data, which could be an inconvenience and in the long-run could mess up the data.
Anyways, connecting a vehicle’s VIN with a publicly available record of its lifespan and service details seems to be a natural application of the blockchain technology. We are yet to witness how the Italian car maker would make use of NFTs for data storage and whether its competitors would follow.
Other automotive companies are also interested in the opportunities the NFT market could offer. For instance, in January 2022, Mercedes entered the NFT space and released an NFT collection dedicated to its iconic G-Class series.
More and more car makers are expected to explore the NFT space which surpassed USD 40 billion, according to Bloomberg.