Economy & Politics

The green bond should bring one billion euros

Daimler’s green bond was oversubscribed four times. Photo: Daimler AG

The car manufacturer Daimler, which has just presented its new luxury sedan S-Class, is collecting money on the capital market. For this purpose, the company has issued an eco-bond worth one billion euros. It should be used, for example, in the development of electric cars.

Stuttgart – The car company Daimler has issued its first green bond. The eco bond has a volume of one billion euros and a term of ten years. The Stuttgart car company announced that the interest rate was 0.75 percent. With this emission, the carmaker, which has just presented its S-Class luxury sedan with a combustion engine, wants to “continue driving towards CO2-neutral technologies and services”, the press release says. The bond was four times oversubscribed. The signatories included the credit institutions BBVA, BNP Paribas, Commerzbank, Crédit Agricole, SEB and Unicredit.

“CO2-neutral mobility and production is a clear goal and an integral part of our sustainable business strategy. The proceeds from our first green bond will be used exclusively to finance green projects. We are driving the transformation towards a carbon-free company and a CO2-neutral industry, ”says Daimler CFO Harald Wilhelm. The new bond meets both the requirements of the International Market Association’s (ICMA) initiative, which has defined principles for green bonds, and the ideas that Daimler has set for itself. ICMA is an international cooperation of issuers, banks, investors and environmental organizations.

Daimler collects the money for e-cars

Daimler intends to use the proceeds from the green financing instruments, for example, for the development and production of emission-free vehicles with purely battery-electric drives and fuel-cell electric drives. In addition, the proceeds can be used, for example, to modernize and upgrade production facilities and to build new plants for emission-free vehicles and their drives, as well as to set up the recycling of batteries and fuel cells. One lighthouse project is Factory 56 in Sindelfingen, a digitally networked factory where the new S-Class rolls off the assembly line.

Green bonds are currently in demand. Only recently did the German government announce that it would collect up to eleven billion euros in eco-bonds for sustainable investments this year. With the money from the first green federal securities, for example, clean transport systems and the transition to an economy that largely works with renewable energies should be promoted, explained the finance and environment ministries in Berlin.


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