The transition to a cleaner future in Brazil starts here
For a business that started with a single truck, SIMPAR has certainly gone
far. The Brazilian holding company’s different divisions now employ more
than 32,000 persons and boast a combined fleet of more than 150,000 cars
SIMPAR not only runs one of the biggest car, truck and heavy equipment rental operations in Latin America; it also has a vast logistics business that serves several key manufacturing industries, a specialized unit that offers mobility and transportation solutions to the public sector, including passenger buses and garbage trucks, and a network of dealerships that sell
new and used vehicles.
But looking down the road, SIMPAR faces a huge challenge: greening its operations. In a bid to combat climate change, Brazil has committed to reducing its emissions of greenhouse gases substantially over the next few decades. The transportation industry, which relies heavily on fossil fuels, is one of the biggest sources of CO2.
SIMPAR is determined to become a leader in the transition to a cleaner future. Over the next few years, it will make large investments in substituting vehicles with conventional internal combustion engines for electric, hybrid and biofuel vehicles.
In support of that effort, IDB Invest will supply the Brazilian company a $270 million financial package, which includes $80 million from IDB Invest itself, $40 million from donor funds managed by IDB Invest, and a syndicated loan for $150 million from commercial lenders.
IDB Invest’s resources include a green loan earmarked for the acquisition of electric vehicles, which still are far more expensive in Brazil than conventional cars and trucks. SIMPAR will also continue receiving technical assistance to develop a long-term action plan to reduce its carbon
“Our participation in SIMPAR’s bold plans should pave the way for other international lenders to support similar efforts in our region,” said IDB Invest project team leader Juan Parodi. “We’re also counting on this project to set an example for other companies in the transportation industry to
start greening their fleets.”
“We must promote large investments like this to encourage the change in the region towards
electromobility. This project is an indication that it is financially worthwhile and that there are business owners willing to support the transition of the sector within their companies.”
IDB Invest project team leader Juan Parodi.