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 and Lexus. The franchises in each segment also sell used vehicles, parts and automotive services, as well as automotive finance and insurance products.

Corporate and other revenue and income includes the results of operations of our stand-alone body shops 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 who 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 are 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 March 31,
	2018			2017
Revenues:
Domestic
New vehicle	$	513,529		$	485,257
Used vehicle retail	264,827			244,997
Used vehicle wholesale	33,607			32,287
Finance and insurance	40,001			36,209
Service, body and parts	107,142			93,402
Fleet and other	11,510			7,607
	970,616			899,759
Import
New vehicle	667,602			551,881
Used vehicle retail	307,689			247,276
Used vehicle wholesale	28,196			26,836
Finance and insurance	51,696			40,573
Service, body and parts	109,655			88,663
Fleet and other	5,595			16,243
	1,170,433			971,472
Luxury
New vehicle	278,521			176,317
Used vehicle retail	142,904			110,606
Used vehicle wholesale	14,199			12,223
Finance and insurance	12,251			7,995
Service, body and parts	64,793			48,032
Fleet and other	3,827			8,630
	516,495			363,803
	2,657,544			2,235,034
Corporate and other	2,135			1,067
	$	2,659,679		$	2,236,101
Segment income¹:
Domestic	$	25,618		$	25,442
Import	23,020			22,172
Luxury	6,886			4,713
	55,524			52,327
Corporate and other	41,559			38,501
Depreciation and amortization	(16,854		)	(12,739		)
Other interest expense	(11,806		)	(6,671		)
Other income (expense), net	1,374			9,845
Income before income taxes	$	69,797		$	81,263

¹Segment 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 March 31,
	2018			2017
Floor plan interest expense:
Domestic	$	11,612		$	7,954
Import	9,429			5,873
Luxury	5,133			3,076
	26,174			16,903
Corporate and other	(12,640		)	(8,851		)
	$	13,534		$	8,052



	March 31, 2018		December 31, 2017
Total assets:
Domestic	$	1,406,219	$	1,338,232
Import	1,231,503		1,137,934
Luxury	696,761		641,118
Corporate and other	1,752,500		1,565,782
	$	5,086,983	$	4,683,066