Brazil’s national development bank BNDES has approved a R$2.3bn ($429mn) loan to Volkswagen to support the carmaker’s shift towards electric mobility and expand exports from its local operations, Argus reported.
The funding will focus on developing and producing flex-fuel hybrid vehicles capable of running on ethanol or petrol, rather than fully electric models, to align with Brazil’s biofuels strategy, BNDES said.
“Every vehicle developed and manufactured by Volkswagen in South America will be electrified at some capacity as soon as 2026,” said Volkswagen Brazil’s chief executive, Ciro Possobom.
The bank said the investment will also finance research in driver-assistance and infotainment technologies, areas in which Chinese EVs — increasingly popular in Brazil — have gained traction.
Volkswagen, currently the country’s top-selling car brand, does not yet offer EVs in its Brazilian portfolio. The company has exported 4.4mn vehicles to 147 countries since 1970, and exports rose 43% in 2025 from a year earlier, according to the carmaker.
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