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.
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.