Segments

While we have determined that each individual store is a reporting unit, we have aggregated our reporting units into three reportable segments based on their economic similarities: Domestic, Import and Luxury.

Our Domestic segment is comprised of retail automotive franchises that sell new vehicles manufactured by Chrysler, General Motors and Ford. Our Import segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Honda, Toyota, Subaru, Nissan and Volkswagen. Our Luxury segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by BMW, Mercedes-Benz and Lexus. The franchises in each segment also sell used vehicles, parts and automotive services, and automotive finance and insurance products.

Corporate and other revenue and income includes the results of operations of our stand-alone body shop offset by unallocated corporate overhead expenses, such as corporate personnel costs, and certain unallocated reserve and elimination adjustments. Additionally, certain internal corporate expense allocations increase segment income for Corporate and other while decreasing segment income for the other reportable segments. These internal corporate expense allocations are used to increase comparability of our dealerships and reflect the capital burden a stand-alone dealership would experience. Examples of these internal allocations include internal rent expense, internal floor plan financing charges, and internal fees charged to offset employees within our corporate headquarters that perform certain dealership functions.

We define our chief operating decision maker (“CODM”) to be certain members of our executive management group. Historical and forecasted operational performance is evaluated on a store-by-store basis and on a consolidated basis by the CODM. We derive the operating results of the segments directly from our internal management reporting system. The accounting policies used to derive segment results are substantially the same as those used to determine our consolidated results, except for the internal allocation within Corporate and other discussed above. Our CODM measures the performance of each operating segment based on several metrics, including earnings from operations, and uses these results, in part, to evaluate the performance of, and to allocate resources to, each of the operating segments.

Certain financial information on a segment basis is as follows (in thousands):



	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Revenues:
Domestic	$	954,949		$	830,410		$	1,854,707		$	1,602,312
Import	1,101,314			930,317			2,072,787			1,793,060
Luxury	413,088			371,866			776,891			718,679
	2,469,351			2,132,593			4,704,385			4,114,051
Corporate and other	(2,315		)	746			(1,248		)	2,149
	$	2,467,036		$	2,133,339		$	4,703,137		$	4,116,200
Segment income*:
Domestic	$	27,857		$	28,999		$	53,299		$	52,129
Import	32,465			29,680			54,637			53,943
Luxury	10,088			9,730			14,801			14,312
	70,410			68,409			122,737			120,384
Corporate and other	38,239			28,394			76,740			55,088
Depreciation and amortization	(14,031		)	(12,503		)	(26,770		)	(24,166		)
Other interest expense	(7,169		)	(5,502		)	(13,840		)	(10,961		)
Other income (expense), net	387			(1,495		)	10,232			(3,021		)
Income before income taxes	$	87,836		$	77,303		$	169,099		$	137,324

*Segment income for each of the segments is defined as income before income taxes, depreciation and amortization, other interest expense and other income (expense), net.



	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Floor plan interest expense:
Domestic	$	8,716		$	6,233		$	16,670		$	12,729
Import	6,793			4,393			12,666			8,627
Luxury	3,383			2,650			6,459			5,308
	18,892			13,276			35,795			26,664
Corporate and other	(9,560		)	(7,067		)	(18,411		)	(14,546		)
	$	9,332		$	6,209		$	17,384		$	12,118



	June 30, 2017		December 31, 2016
Total assets:
Domestic	$	1,253,814	$	1,225,387
Import	1,037,626		959,355
Luxury	491,627		511,779
Corporate and other	1,193,428		1,147,629
	$	3,976,495	$	3,844,150