Brazil’s Leading Fleet Management Company Does it All!

Eduardo Fleck Diefenthaeler

Director of Marketing & Product Development, Ecofrotas

Eduar­do, intro­duce us to Ecofro­tas.

Our com­pa­ny was found­ed in 1999.  We start­ed as an orga­ni­za­tion that man­aged phar­ma ben­e­fits and meal vouch­ers. Our focus was in human resources. In 2002, one of our larg­er clients asked us to devel­op a solu­tion for fuel cards.  There were some com­pa­nies doing it, but we thought it was an oppor­tu­ni­ty to devel­op a bet­ter solu­tion. There was space in the mar­ket to launch a prod­uct and we did.

After that, we kept focused on our clients’ require­ments and they start­ed to ask for not just fuel cards but main­te­nance man­age­ment sys­tems. After that, they kept ask­ing us for oth­er fleet man­age­ment ser­vices because in Brazil we have a lot of com­pa­ny owned fleets. There are leas­ing com­pa­nies here but they have just a small slice of the mar­ket share. Clients want to have the same ben­e­fits that you have when you lease a car and basi­cal­ly out­source all of the ser­vices that are not the client’s core busi­ness.

In 2009, we decid­ed to focus on the sus­tain­able mobil­i­ty mod­el. That is our long term goal. We start­ed with the basics, mea­sur­ing the car­bon foot­print of our clients’ vehi­cles. Ecofro­tas helped them to devel­op their green­house gas­es inven­to­ry. Our fleet intel­li­gence reports allow the man­agers to reduce their emis­sions and save mon­ey as they are reduc­ing over­all fleet costs as well.

We launched at RIO+20 the first car­bon cred­it project in the world. It tracks when a client sub­sti­tutes ethanol for gaso­line in their flex-fuel vehi­cles.  Our busi­ness start­ed in one direc­tion and then was dri­ven in oth­ers by client demand.  So we changed a lot. This is Ecofro­tas!

Tell us more about Rio +20 and Ecofro­tas.

RIO+20 was held in Brazil in June. Dur­ing the con­fer­ence Ecofro­tas was grant­ed approval for its plan to devel­op car­bon cred­its. We are the first and only approved plan so far. Our method­ol­o­gy and stan­dards  were mea­sured, test­ed and accept­ed. The quick ver­sion of this pro­gram begins when sus­tain­able sug­ar cane ethanol is used to replace gaso­line, then car­bon cred­its are gen­er­at­ed. Our clients can use these cred­its from Brazil to off­set their car­bon foot­print any­where is the world. We are final­iz­ing our pilot project through the end of the year and will be ful­ly oper­a­tional in 2013. Our Euro­pean Clients are espe­cial­ly excit­ed about the pro­gram.

What are some of the ser­vices you pro­vide your clients?

We have clients like 3M, Wal-Mart and Phillip Mor­ris that own their vehi­cles and place all the fleet man­age­ment ser­vices with us.  We nev­er sim­ply pay repair shops; we have devel­oped a nation­wide repair net­work. We have 24-hour assis­tance for Tele­fon­i­ca, who is one of our clients. We buy cars and send them to be upfit­ted for their exec­u­tives. We deliv­er the cars and we sell the cars for them. We do every­thing a leas­ing com­pa­ny could, but with­out sup­ply­ing the asset – with­out the fund­ing.

We start­ed every­thing from clients’ requests; they are the rea­son we focus on this kind of full ser­vice. In the last three years we start­ed with 1,500 vehi­cles in this com­plete, full pack­age solu­tion. This year we will end with more than 20,000 vehi­cles. Today we man­age for more than half mil­lion vehi­cles in Brazil.

Let’s talk a lit­tle bit about tech­nol­o­gy and your busi­ness intel­li­gence mod­el.

We are very good in tech­nol­o­gy and ser­vices, but also we are very focused on infor­ma­tion — in putting intel­li­gence in the data that we cap­ture. We have a busi­ness intel­li­gence mod­el where we give the clients a dash­board with the cost per kilo­me­ter, mileage per liter, price of fuel per liter, kilo­grams of CO2 equiv­a­lent emis­sion per kilo­me­ters. You have the big pic­ture of the whole fleet and you can go into the detail of the dri­ver, of the vehi­cle and you can even go into detail of each trans­ac­tion that was made in the sys­tem. It is very good because the sys­tem shows when a trans­ac­tion is out of the ordi­nary process­es. It cre­ates an excep­tion that you should look at and also all the KPI’s that you showed to the client in the dash­board

We have bench­marks because with the bench­marks we define para­me­ters and show the oper­a­tions of one client and com­pare sim­i­lar clients in our data base of 550,000 vehi­cles. With this bench­mark we don’t just show the client his trend, we can show him if he is bet­ter or worse than the aver­age client with a sim­i­lar oper­a­tion. This is very impor­tant to reduce the num­ber of cars and reduce the future emis­sions.   The num­bers don’t lie.

Do you have a sense of  the sav­ings that your clients can achieve by uti­liz­ing this tool?

I can say that it depends a lot on how expe­ri­enced and how good the man­age­ment of the client is to begin with. We had some banks before the 2008 cri­sis that were not con­cerned about the fuel costs of their fleets because they made a lot of mon­ey. In 2008, they became very con­cerned about costs and hired us to reduce their fuel spend. We low­ered the fuel costs for one of the largest banks in the world by more than 30%. There were a lot of things to do there and they were focused on cost reduc­tion. It was a per­fect com­bi­na­tion. When you have a client with good fleet man­age­ment, you will reduce 5% to 10% because they already do a huge part of the job.

One of the things that intrigued me about your ser­vices was that the dri­ver can be direct­ed at the point of sale to fuel the vehi­cle with either ethanol or gaso­line.

In Brazil, the price of gaso­line does not change a lot dur­ing the year because the gov­ern­ment inter­acts with Petro­bras, which is the Brazil­ian fuel com­pa­ny that con­trols the fuel price. They don’t have con­trol of the price of ethanol and it changes a lot dur­ing the year. What we do is to tell the client when they need to use ethanol or when they need to use gaso­line. We con­sid­er the effi­cien­cy between each fuel is around 78% — in Brazil they say 70%, but the true data of our data base shows that it is around 78%. We can show the client in each city which fuel he should use in each month of the year. There is a lot of sav­ings there.

Do you notice any dif­fer­ence in engine wear or any oth­er main­te­nance issues between vehi­cles that are run on ethanol ver­sus vehi­cles that are most­ly run on gaso­line?

No. I can say that it is exact­ly the same. Exact­ly the same, it doesn’t change any­thing.

BIO

Eduar­do Fleck Diefen­thael­er
Direc­tor of Mar­ket­ing and Prod­uct Devel­op­ment

Eduar­do Fleck Diefen­thael­er joined Ecofro­tas in 2004 as a project man­ag­er. He has more than 13 years of expe­ri­ence in the trans­porta­tion indus­try, begin­ning his career in his family’s com­pa­ny, Ouro e Pra­ta Group.

[email protected]

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