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Segment Information

12 Months Ended

Dec. 31, 2019

Segment Information

Segment Information

17. Segment Information

Our operations are organized by management into operating segments by line of business and geography. We have determined that we have four reportable segments as defined in generally accepted accounting principles for segment reporting: (i) Retail Automotive, consisting of our retail automotive dealership operations; (ii) Retail Commercial Truck, consisting of our retail commercial truck dealership operations in the U.S. and Canada; (iii) Other, consisting of our commercial vehicle and power systems distribution operations and other non-automotive consolidated operations; and (iv) Non-Automotive Investments, consisting of our equity method investments in non-automotive operations. The Retail Automotive reportable segment includes all automotive dealerships and all departments relevant to the operation of the dealerships and our retail automotive joint ventures. The individual dealership operations included in the Retail Automotive reportable segment represent six operating segments: Eastern, Central, and Western United States, Stand-Alone Used United States, International, and Stand-Alone Used International. These operating segments have been aggregated into one reportable segment as their operations (A) have similar economic characteristics (all are automotive dealerships having similar margins), (B) offer similar products and services (all sell new and/or used vehicles, service, parts and third-party finance and insurance products), (C) have similar target markets and customers (generally individuals) and (D) have similar distribution and marketing practices (all distribute products and services through dealership facilities that market to customers in similar fashions). The accounting policies of the segments are the same and are described in Note 1.

The following table summarizes revenues, floor plan interest expense, other interest expense, depreciation, equity in earnings of affiliates, and income (loss) from continuing operations before certain non-recurring items and income taxes, which is the measure by which management allocates resources to its segments and which we refer to as adjusted segment income, for each of our reportable segments.



		Retail			Retail Commercial						Non-Automotive			Intersegment
		Automotive			Truck			Other			Investments			Elimination			Total
Revenues
2019		$	20,615.8		$	2,050.5		$	513.1		$	—		$	—		$	23,179.4
2018			20,849.2			1,374.5			561.4			—			—			22,785.1
2017			19,824.3			1,048.0			514.6			—			—			21,386.9
Floor plan interest expense
2019		$	74.9		$	8.0		$	1.6		$	—		$	—		$	84.5
2018			74.9			4.2			1.8			—			—			80.9
2017			59.4			2.7			1.3			—			—			63.4
Other interest expense
2019		$	118.4		$	3.2		$	2.6		$	—		$	—		$	124.2
2018			108.3			2.4			4.0			—			—			114.7
2017			95.0			3.4			9.0			—			—			107.4
Depreciation
2019		$	99.1		$	5.5		$	5.0		$	—		$	—		$	109.6
2018			94.2			4.3			5.2			—			—			103.7
2017			85.7			4.1			5.3			—			—			95.1
Equity in earnings of affiliates
2019		$	5.2		$	—		$	—		$	142.3		$	—		$	147.5
2018			5.2			—			—			129.6			—			134.8
2017			4.6			—			—			103.0			—			107.6
Adjusted segment income
2019		$	339.9		$	86.5		$	22.8		$	142.3		$	—		$	591.5
2018			389.7			62.3			22.5			129.6			—			604.1
2017			397.2			38.4			9.6			103.0			—			548.2

Total assets, equity method investments, and capital expenditures by reportable segment are as set forth in the table below:



		Retail			Retail Commercial						Non-Automotive			Intersegment
		Automotive			Truck			Other			Investments			Elimination			Total
Total assets
2019		$	10,960.1		$	1,075.8		$	579.9		$	1,326.9		$	—		$	13,942.7
2018			8,501.4			571.5			590.5			1,241.1			—			10,904.5
Equity method investments
2019		$	72.1		$	—		$	—		$	1,326.9		$	—		$	1,399.0
2018			64.1			—			—			1,241.1			—			1,305.2
Capital expenditures
2019		$	231.9		$	9.9		$	3.5		$	—		$	—		$	245.3
2018			292.6			9.3			3.7			—			—			305.6
2017			237.8			6.4			2.8			—			—			247.0

The following table presents revenue and long-lived assets (all non-current assets except goodwill, other indefinite-lived intangible assets, and operating lease right-of-use assets) by geographic area:


		Year Ended December 31,
		2019			2018			2017
Revenue from external customers:
U.S.		$	13,511.8		$	12,607.8		$	12,487.2
Non-U.S.			9,667.6			10,177.3			8,899.7
Total revenue from external customers		$	23,179.4		$	22,785.1		$	21,386.9
Long-lived assets, net:
U.S.		$	2,481.1		$	2,365.5
Non-U.S.			1,303.8			1,205.6
Total long-lived assets		$	3,784.9		$	3,571.1

The Company’s non-U.S. operations are predominantly based in the U.K.

The following tables present our revenue from external customers by product type for our Retail Automotive and Retail Commercial Truck segments:


		Year Ended December 31,
Retail Automotive Dealership Revenue		2019			2018			2017
New vehicle		$	9,329.5		$	9,666.4		$	9,678.5
Used vehicle			7,241.2			7,252.1			6,386.8
Finance and insurance, net			652.1			629.6			581.8
Service and parts			2,195.9			2,151.4			2,057.5
Fleet and wholesale			1,197.1			1,149.7			1,119.7
Total retail automotive dealership revenue		$	20,615.8		$	20,849.2		$	19,824.3


		Year Ended December 31,
Retail Commercial Truck Dealership Revenue		2019			2018			2017
New truck		$	1,347.2		$	866.9		$	613.2
Used truck			117.0			112.0			89.4
Finance and insurance, net			12.4			11.9			9.0
Service and parts			503.3			364.5			325.6
Other			70.6			19.2			10.8
Total retail commercial truck dealership revenue		$	2,050.5		$	1,374.5		$	1,048.0