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Volkswagen and IOTA Build the Future

Volkswagen and IOTA Build the Future

Volkswagen is one of the world’s largest automakers, and a primary focus of IOTA is on the mobility sector. Let’s pull back the curtain on just how much of an impact a collaboration between the two might have.


Fact Box:

– 10.7 million vehicles delivered in 2017 (new record)

– €230.7bn revenue

– 642,000 employees

– Headquarters in Wolfsburg, Germany


IoT is still in its infancy. Billions of devices will flood the market in the coming years, and their data streams will need to be coordinated in the best scalable way. Without a scalable solution, there is no use in even collecting all the data in the first place. Before his official role at the IOTA Foundation, Jungwirth appeared on German national TV and called IOTA “a very exciting” solution to this problem. After he had posted tweets about IOTA and liked the technology, Johann Jungwirth became a member of IOTA’s supervisory board in January 2018. You might not know this name immediately, but Jungwirth is Volkswagen’s Chief Digital Officer (CDO). His decision to join the IOTA Foundation bodes well for IOTA’s adoption by the industrial sector.

Volkswagen’s vision of the future

In order to get a good overview of how Volkswagen is planning to implement IoT into its cars, lets take a look at the keynote speech by Jungwirth that was given at the Bosch Connected World conference 2018. He explicitly talks about the advantages of IOTA:


When you read how Volkswagen envisions the future of “tomorrow’s world“, you might consider this as rather utopic. For now.

Volkswagen has used this year’s CEBIT fair, the world’s largest and most internationally representative computer expo, to promote their partnership with IOTA. Fujitsu did the same thing at Hannover Messe, as detailed in a previous article. Here’s a clip from CEBIT 2018:

At this point, the reader should be wondering why global player would do this if the people in charge were not totally convinced of IOTA’s technology?

So let’s have a look at what’s on the horizon.

IoT-related trends at Volkswagen

  • Volkswagen has a strong focus on e-mobility, highlighted by their €50b planned expenditures over the next few years in battery cell procurement. Additionally, they’re holding themselves accountable to an ambitious goal of producing an all-electric or hybrid version of their entire portfolio (i.e. 300 different models).
  • Autonomous driving will enable new concepts for mobility. Driving, navigation, and even optimal traffic flow will be highly optimized without the driver having to think about it, making travel greener, less stressful and safer. This will also affect the design of the cars, since a driver will no longer be necessary.
  • pWLAN technology will be implemented beginning in 2019. Within the limits of the system, the new technology is capable of identifying potential traffic hazards. Examples would include a car making an emergency stop, or the on-board sensors detecting black ice. Within a few milliseconds, this information can be shared with the local environment and allow other vehicles to react to this risky situation more quickly.
  • Artificial Intelligence (AI) plays a pivotal role. “[It] is the key to the digital future of the Volkswagen Group. We want to develop and deploy high-performance AI systems ourselves,” explains Dr. Martin Hofmann, CIO of the Volkswagen Group.
  • Digitalization leading to (I)IoT, leading to Smart Factories, thus bringing Industry 4.0 to fruition.
  • Read our previous article for more on the emergence and importance of IoT in general.

If Volkswagen already has the tech, why the need for IOTA?

Volkswagen has already implemented enormous amounts of technology into their cars. However, the data always stays in the realm of Volkswagen. The same is true for any other car manufacturer, and any other proprietary product – they all have the tech, but they can only use it between their own compatible products. This has been a recurrent issue on the topic of future analytics solutions in the field of “big data”. Here are some specific problems arising due to this challenge in VW’s case:

  •  I have a smart EV-charging solution on board – but I can only use it at stations supported by VW.
  • What happens to the data that’s collected while driving? Does it stay with Volkswagen? If not, who else gets access to it?
  • I would like to exchange information with other cars, but we don’t share the same protocol to exchange data.
  • I find a cool third-party application which would enhance my driving experience, but it’s not supported by VW due to restrictions in the protocol.

What is missing is a common protocol for the whole IoT business. Without it, customers will always be restricted to their manufacturer’s network. IOTA, however, is a universal protocol which strives to be the industry’s standard to connect all the data, allowing the appropriate entities to make use of it. It is the only working technology which offers not only the necessary speed (which goes far beyond Bitcoin, Ethereum, and the like) and scalability (imagine billions of devices sending data at the same time, 24/7), but it is also free. No mining rigs are needed, and no fees have to paid. These features make IOTA a compelling solution for microtransactions since it’s now possible to pay tiny amounts of money without having to pay anything as a fee.

You are waiting at a red traffic light; your car is being recharged automatically via a smart recharging solution under the surface of the street. After only 10 seconds, the light turns green and you drive on. If you wanted to pay this with other cryptocoins, fees would be higher than the charged power. With IOTA, you can even pay these tiny amounts without having to pay any fees. And it can be done in seconds without any scaling problems.

In a recent interview with Thompson Reuters, Jungwirth explained the importance of “privacy by design”, and what IOTA can offer with regard to that approach to privacy. It’s important that VW should only get the data which the user consents to.

All of these use cases are connected to transactions. If you think about faster transactions like payment [sic]: these vehicles will park themselves, they will go and charge themselves. There are a lot of these transactions, like entering through a gate into a parking garage, or cleaning services, or repair, or maintenance. That means there are a number of trusted transactions for these vehicles. These are the primary use cases which I see covered through either blockchain or tangle or any of these distributed ledger technologies. Maybe to add to that, think of this more in a longer term. You could imagine that eventually these autonomous vehicles could become entrepreneurs. The vehicle itself could define autonomous pricing based on demand, then actually handle all the payments for parking and charging, and with customers it could handle transactions for the mobility, transportation payments, including e-commerce and advertisements. That’s the longer-term direction.

When will we see the first working products?

A very interesting panel discussion had big players of VW and Dominik Schiener, co-founder of the IOTA-foundation, discussing this matter. The bottom line with regard to a working product is that Benjamin Sinram (Head of Blockchain Research, Volkswagen AG) announced that by early 2019 we can expect the first products implemented in Volkswagen cars – with CarPass leading the way!

Taking these technological advantages into account, then adding in Jungwirth’s connections (previous jobs at Mercedes-Benz and Apple) and influence at one of the biggest car manufacturers worldwide, it becomes clear to see that this could be a win-win-situation for both IOTA and Volkswagen.




Written by: Chris Mueller