📋 Tender Overview
Project Number
49507
Company Name
Element Fleet Management Corp
Date ESRS Disclosed
Jan 29, 2025
Country
Mexico
Region
Latin America and the Caribbean
Last Updated Date
Environmental Category
B
Status
Pending Disbursement
Previous Events
Approved : Dec 17, 2024
Signed: Dec 20, 2024
Sector
Transit and Ground Passenger Transporation
Industry
Infrastructure
Department
Regional Industry INF LAC & EUR
Project Description
Element Fleet Management Corporation Mexico (https://www.elementfleet.com.mx/) (or the company ) provides fleet financing and fleet management services to organizations. It optimizes fleet operations, including vehicle acquisition, maintenance, fuel management, safety, and remarketing. Element Mexico offers customized solutions to reduce costs, improve efficiency, and enhance fleet performance. While historically focused on fossil fuel-powered vehicles, Element Mexico is now dedicated to providing clients with solutions for electric vehicle (EV) adoption.
IFC's proposed investment is a senior, unsecured debt financing package to be processed under the INR Strategic Client Framework initiative. The proposed loan may be structured in several tranches over multiple years. The first tranche (US$ 100 million), to be committed in the fiscal year 2025, entails an up to 5-year Sustainability-Linked Loan (SLL) with IFC providing US$75 million A Loan and mobilizing US$25 million. Future tranches may be committed over the next 3-5 years based on Element Mexico’s capex plans and timeline.
IFC's proposed investment is to support the purchase of passenger and commercial vehicles, medium and large trucks, as well as compatible charging infrastructure. The proposed investment will contribute to Mexico’s commitment to the Paris Agreement of reaching a 35% reduction in CO2 emissions below 2007 levels by the year 2030, particularly where commercial vehicles, with their greater number of daily kilometers traveled, present a larger opportunity for carbon reduction than personal vehicles. The transport sector is responsible for nearly 25-30% of Mexico’s GHG emissions, and road transport accounts for more than 80% of the sector’s emissions.
Overview of IFC's Scope of Review
IFC's review of the proposed investment consisted of appraising environmental, health and safety (EHS), and social-related information submitted by Element Mexico, including technical details about the project, Element Mexico’s E&S policies and procedures, working conditions, workers’ grievance mechanism, supply chain management, and stakeholder engagement. The appraisal included discussions and in-person visits with Element Mexico’s corporate-level OHS staff in Mexico City and its clients’ operations in July 2024.
