Digital traceability of plastics via blockchain technology: a model for industry

Traceability of materials in the manufacturing value chain is vital for any industry aiming to reduce its carbon footprint. Covestro and several suppliers teamed up with Porsche and blockchain transparency start-up Circularise to create a digital twin thread through the value chain to trace plastics used in the Porsche cars and track the CO₂ footprint.
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Car industry seeks transparency in the value chain

Like many sectors, automotive production faces ever more stringent environmental requirements, driven by rising consumer expectations and regulatory demands for material traceability and transparency about the CO₂ footprint of each product. 
A typical car contains around 30,000 different parts, incorporating raw materials from aluminum, iron ore and rubber to glass and plastic components. This makes the process of assessing the carbon footprint of automobile manufacturing a complex task. Car makers have to conduct a value chain analysis that goes beyond just the production process to cover the entire life cycle, from the sourcing of materials from multiple suppliers, through the customer use phase, and on to the car’s dismantling. 
Assembling this detailed mosaic image of the supply chain immediately raises concerns around trust, privacy and confidentiality. Proprietary information on the make-up of specific materials or data about who is supplying whom are sources of competitive advantage in the automotive production value chain. However, detailed material information is clearly a requirement for measuring CO₂ footprint, water consumption and other key sustainability metrics in the production process.  This type of information will also help car manufacturers make better decisions on sustainable process and material choices for next generation vehicles.

Solution: use blockchain technology to create a ‘digital twin’ for every material batch

Grappling with this supply chain sustainability dilemma, premium car maker Porsche teamed up with Circularise, a Dutch supply chain transparency start-up, and several innovative material suppliers including Covestro, Borealis, and Domo Chemicals to launch a material traceability project using blockchain technology. 
The core idea is to manage trust and privacy issues in the process by creating a virtual ‘digital twin’ blockchain thread for each batch of material; a thread that extends throughout production the value chain. This digital twin carries all relevant information regarding the batch, such as its origin, environmental footprint and statements of recycled content, process and more. 
Once the materials are digitized and packaged with QR code labelling, parties along the supply chain can update the digital twin to reflect the most recent production process. This virtual thread becomes a simulation, tracking what physically happens to a particular material batch. At the same time, Circularise builds a patented ‘Smart Questioning’ process into the blockchain to safeguard the identity, business relations, production advantages and confidential information of all parties in the value chain.

“We need to know more details on the parts and materials being used in our products, that means information on production processes deep down the supply chain, statements of recycled content and more.”

Antoon Versteeg

Project Lead Innovation Research, Porsche

Reality check for the digital thread: verification

The ability to identify, track and trace each component using blockchain technology opens up a new level of transparency. Porsche is even using digital twin technology for a phone app that allows car owners to analyze their own vehicle in depth. By scanning a portion of a car, customers can see what it is actually made of, where the parts come from, and what impact they have on the environment. With the digital blockchain, supply chain sustainability is made visible, quite literally.
To be credible, the blockchain must mirror physical reality, so verification is an absolute requirement. In production, each batch of materials needs to be audited by an independent third party to verify that the material properties, its origin, and related process and sustainability claims are true.

“We believe transparency should not come at the cost of reduced privacy and confidentiality. That is why we developed our patent pending technology for creating verified statements on public blockchains without revealing any underlying sensitive data.”

Mesbah Sabur

Founder, Circularise

Material traceability is achievable and is here to stay, even in complex industries. Join us!

By creating a new digital thread in the automotive value chain in collaboration with Circularise and Porsche, we have proved that supply chain transparency and sustainable material traceability can be achieved, even with complex production. This is a big step forward in supporting industries such as the automotive sector in achieving their sustainability goals.
Covestro is forging a range of partnerships across the value chain - in many sectors - to jointly envision new solutions on process, and for alternative raw materials, innovative recycling, and renewable energy. Get in touch with your Covestro representative and join our effort to build a more circular economy.

“For us, it is really important to share information and be more transparent while maintaining confidentiality. For instance, the material composition is of competitive advantage so we would never share that openly. Here, Circularise helps us to maintain this confidentiality and only disclose the information needed from raw material producer to recycler. And with that, we can close the loop.”

Uwe Peuker

Vice President Regional Product Management Polycarbonates

Key Benefits

  • Traceable: Blockchain technology enables you to track and trace each material batch.
  • Transparent: Digital twin technology provides proof of when sustainable materials are used.
  • Collaborative: Value chain partners update the digital thread to reflect material processes.
  • Confidential: Information on material composition and supplier identity is protected.

Vision to reality:

Partnerships to make plastics circular and sustainable

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