That’s a majority of it.The other thing is we did update the modelling, what just, what the actual loans are looking like. So with the rising interest rates, there’s been a little bit of net interest margin compression. And so in the forecasting we’ve actually rolled that through as well as we have clear line of sight as to what the loan would look like in its build to date. So that — those are the two main factors that are driving the change in the outlook.Rajat Gupta Got it. And for 2024, or just to follow up on Daniel’s question earlier, is there a combination of the restatement there as well, or is that more purely fundamentals?Bryan DeBoer I think for 2024 we see more stabilization of both DFC in terms of our fundamentals in our growth rate seems to be consistent on a notional basis with 2023.
So, I think it is, again, primarily, as I stated earlier, primarily just the organic growth or notional growth as Lithia & Driveway continues to grow, we’re just going to see higher originations on a notional basis, and that’s just really going to drag down the overall profitability in 2024.Rajat Gupta Understood. and maybe, just to follow up on the guidance you had provided on the prior earnings call, you’d given us some high level puts and takes across, different businesses for the year, including like SG&A and to gross in the 61% to 64% range. Wondering if there’s any update to that just so feel comfortable with those ranges, including SG&A to gross and the $1 billion free cash flow, any updated color you can give us on that would be helpful.Bryan DeBoer Rajat, we’re very comfortable with the previous guidance in that 61% to 64%, and the other relative guidance that we’ve given.
We keep our head down and continue to execute on the plan and not a lot’s changed other than GPUs are still planning on normalizing, and they were actually a little stronger than what we actually had expected. We were expecting about a $200 decline in new vehicle grosses. Now that was offset by some stabilization in the used vehicles as well, but very comfortable with where we sit and what we’re guiding.Rajat Gupta And the 61% to 64%, is that slightly better than previously just because some of the SG&A is now moving into the DFC line, or are you still like maintaining that range irrespective of the reported change?Bryan DeBoer Sure, Ragat, Bryan again, if you go back a few quarters or even a few years, we did take a couple 100 basis points out of our costs structure in terms of personnel, but the most important driver, and we’ll be able to give you more insights into this is that our network is way cleaner than it was pre-COVID.