The two firms are offering the first ever “green bonds” for the auto industry. Green bonds are securities whose proceeds are used for projects that promote environmentalism. A number of banks, including Citibank, have issued green bonds before, but never in the auto finance industry.
Toyota’s $1.75 billion worth of bonds will be used to finance the purchase of high-efficiency vehicles ― any of the four Prius variants, Camry Hybrid, Avalon Hybrid, RAV4 EV, Lexus CT 200h and Lexus ES 300h ― according to published reports.
Could this be the start of a trend? Is it possible other lenders will get involved in environmental issues to help promote their image among an increasingly green population?