b'forasalespaceof15.6million[note:constraints, OEMs should also be able tocalledbatteryelectricvehiclesorBEVs, units sold during the year expressed asdeliver more vehicles to fleet customers.accounted for 6.4% of sales, while hybrids amonthlypace],andindicationsareOur forecast for new light-vehicle sales inhit 5.7% and plug-in-hybrids 1.4% of sales. the market came in slightly higher, closer2023 is 14.6 million units [Editors Italics]. While there is a wider public interest in EVs to15.7million.Eitherway,new-vehicleBottom line is whether it is a 15.7 millionwith the rise in environmental, social and sales in January were solid and likely aunit pace or 14.6 million unit pace, autogovernance (ESG) initiativesespecially in signthatimprovedinventorylevelsaresales clip, is far short of the 17 million unitstates like Californiathe main barrier is having the expected positive effect. Wepace of pre-pandemic auto sales.price. For most consumers that means EV [Cox Automotive] also believe that fleetIs this the new normal or a springboardprice and ownership parity with ICE vehi-salesincreasedsignificantlyfortheto a more robust auto market over the nextcles.Rightnow,EVsarepricier,whether fourth straight month. With interest ratesdecade? Right now, its hard to determinemeasuredbystickerpriceorownership forautoloanselevatedandheadingwhich way the wheels are spinning but thereoperating costs. But that may be changing. higher and inflation pressures impactingare some clues. TeslaandFordarereducingtheprices many households, our team expects theof their EVs to encourage consumers to major automakers to pivot to fleet salesBreaking the ICEEVs Gaininggo-electric now. to offset slowing retail demand. Ground But other EV OEMs, like GM are for the When Cox says fleet sales it refers tomomentcontenttositonthesidelines a market composed of rental companiesAccording to NADAs numbers (derivedof the EV price-war and wait for the auto andothercorporateentitiesthatbuyfrom Wards) 86.4% of the light vehiclesmarket [and the global economy in gen-fleets of vehicles for either their own usesold were powered by internal combustioneral] to rally. or lease, rather than consumers that makeengines(ICE).ThatsanoverwhelmingThat might not be a wise strategy. John up the retail side of the business.market share but electric vehicles (EVs)McElroy, president of Blue Sky Productions The National Automobile Dealers Asso- are gaining ground and becoming a majorwhichproducesAutolineDaily,recently ciation (NADA) takes a similar view of theand rising contributor to auto sales. Onwrote an opinion piece for WardsAuto, that forces shaping the auto market, but overallapercentagebasisEVsarethefastestpointed out the potential danger of OEMs has a less rosy view of 2023, largely basedgrowingsegmentoftheautoindustry,sitting on the sidelines during the coming EV on rising interest rates, The Fed increasedalbeitstartingfromamuchlowerbasewars, This is not a time for automakers to the targeted range of the Fed Funds Rate bypoint. Data, from Statista estimates thatwait and see how things develop. Its going 25 basis points at its first meeting of 2023.EV sales will hit $450 billion in 2023 andto be very difficult for those who arrive late Thisincreasewillpushvehicle-financingexpect that number to rise to $850 billionto catch up. There is a finite universe of BEV rateshigherincomingmonths,andweby 2027 - a mere four years from now. Itsbuyers right now, and whoever gets them [NADA] believe that the Fed will increaseeasy to see with these projections howfirst will leave everyone else struggling to rates a couple more times before pausingEV sales might lift auto sales back to thefind customers.later this year. For the rest of the year, wepre-pandemic threshold.expect that inventory levels will continueOf course, at this stage the EV market tobuildslowly,givingconsumersmoreis fragmented and small in relation to ICE choice on dealer lots. With fewer supplysales. In 2022, pure electric vehicles also Fig. 3Back to Contents THE UNCONTAINED 25'