Norges Bank Investment Management (NBIM), Norway’s $1.5-trillion wealth fund, expanded its stake in America’s Tesla and China’s BYD last year amid these electric automakers’ continuous electric vehicle production ramp, Bloomberg reports.
NBIM boosts investment in Tesla and BYD
NBIM increased its holdings in Tesla to 0.98% (about $7.7 billion) at the end of 2023 from just 0.87% in the prior year, as per the fund’s list of holdings.
In effect, Tesla successfully advanced as NBIM’s 11th biggest holding at the end of last year.
Likewise, the wealth fund increased its holdings in BYD from 0.38% in 2022 to 0.57% last year.
Slow investment returns
Interestingly, NBIM’s Chief Executive Nicolai Tangen forecasts slow investment returns this year primarily due to soaring interest rates, inflation, and geopolitical risk.
“I think It’s going to be a very slow year. At best, pedestrian, because I think (interest) rates will be slow to get down.”
NBIM CEO Nicolai Tangen stated in an interview during the World Economic Forum (WEF) annual meeting
Mr. Tangen further noted that inflation would prevail and alleviate “more slowly than I think is generally expected.” Moreover, he asserted that the ongoing war in Ukraine and Gaza may pose a risk to the fund’s investments. He also expressed concerns over “a lot of elections in many parts of the world.”
“We have geopolitical uncertainty in many places, that’s well known. And we have, you know, (company) valuations which are really relatively demanding. So I don’t see a lot of good news here.”
NBIM CEO Nicolai Tangen
For context, NBIM invests Norway’s oil and gas revenues in global equities, bonds, property and renewables. According to Reuters, it is currently the biggest sovereign wealth fund in the world, with investments in 9,200+ firms. It also apparently holds 1.5% of all listed stocks.
Tesla vs. BYD (2023)
Tesla’s electric vehicle deliveries reached 484,507 units in the fourth quarter of 2023. During this period, BYD surpassed Tesla with its 526,409 unit EV sales.
BYD’s feat against the American EV pioneer significantly highlights China’s increasing prevalence in the global market.
Nonetheless, Tesla remained the market leader in the full year of 2023, with 1.81 million sales. Meanwhile, BYD only sold 1.57 million all-electric vehicles last year.
It would be exciting to see how these two major electric vehicle players will fare this year, considering the imminent launches of new models from other rivals, both legacy and startups. For now, we can expect NBIM to disclose its key results for 2023 on Tuesday.
