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SEGMENTS | 6 Months Ended
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Jun. 30, 2022
Segment Reporting [Abstract] |
SEGMENTS | 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 Stellantis, General Motors and Ford. Our Import segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Toyota, Honda, Hyundai, 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 income for Corporate and other while decreasing segment income for the 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 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, excepted for the internal allocation within Corporate and other discussed above. Our CODM does not regularly review capital expenditures on a reporting unit level. Performance measurement of each reportable segment by the CODM are based on several metrics, including earnings from operations. The CODM uses these results, in part, to evaluate the performance of and to allocate resources, mainly associated with expected inventory and working capital requirements, to each of the reportable segments. Certain financial information on a segment basis is as follows:
|  | Three Months Ended June 30, |  | Six Months Ended June 30,
(in millions) |  | 2022 |  | 2021 |  | 2022 |  | 2021
Revenues: |  |  |  |  |  |  |  |
Domestic |  |  |  |  |  |  |  |
New vehicle retail |  | $ | 1,069.2 |  |  | $ | 924.6 |  |  | $ | 2,004.8 |  |  | $ | 1,539.2 |
Used vehicle retail |  | 839.4 |  |  | 641.7 |  |  | 1,585.8 |  |  | 1,103.9 |
Used vehicle wholesale |  | 132.7 |  |  | 63.8 |  |  | 260.8 |  |  | 100.0 |
Finance and insurance |  | 96.4 |  |  | 78.6 |  |  | 185.7 |  |  | 137.2 |
Service, body and parts |  | 203.3 |  |  | 159.1 |  |  | 390.9 |  |  | 279.8 |
Fleet and other |  | 58.2 |  |  | 21.6 |  |  | 112.3 |  |  | 39.2 |
|  | 2,399.2 |  |  | 1,889.4 |  |  | 4,540.3 |  |  | 3,199.3 |
Import |  |  |  |  |  |  |  |
New vehicle retail |  | 1,345.5 |  |  | 1,385.7 |  |  | 2,633.9 |  |  | 2,353.8 |
Used vehicle retail |  | 1,009.4 |  |  | 717.8 |  |  | 1,905.3 |  |  | 1,280.0 |
Used vehicle wholesale |  | 116.8 |  |  | 90.0 |  |  | 248.6 |  |  | 148.3 |
Finance and insurance |  | 183.0 |  |  | 140.5 |  |  | 353.4 |  |  | 246.0 |
Service, body and parts |  | 267.3 |  |  | 204.8 |  |  | 510.4 |  |  | 361.5 |
Fleet and other |  | 4.8 |  |  | 18.6 |  |  | 14.9 |  |  | 32.6 |
|  | 2,926.8 |  |  | 2,557.4 |  |  | 5,666.5 |  |  | 4,422.2 |
Luxury |  |  |  |  |  |  |  |
New vehicle retail |  | 836.4 |  |  | 839.2 |  |  | 1,672.9 |  |  | 1,453.3 |
Used vehicle retail |  | 647.1 |  |  | 448.4 |  |  | 1,243.7 |  |  | 779.6 |
Used vehicle wholesale |  | 101.3 |  |  | 59.3 |  |  | 208.4 |  |  | 99.0 |
Finance and insurance |  | 63.6 |  |  | 52.6 |  |  | 126.0 |  |  | 89.5 |
Service, body and parts |  | 196.9 |  |  | 150.1 |  |  | 380.0 |  |  | 271.8 |
Fleet and other |  | 33.2 |  |  | 9.6 |  |  | 50.5 |  |  | 37.4 |
|  | 1,878.5 |  |  | 1,559.2 |  |  | 3,681.5 |  |  | 2,730.6 |
|  | 7,204.5 |  |  | 6,006.0 |  |  | 13,888.3 |  |  | 10,352.1 |
Corporate and other |  | 35.6 |  |  | 3.4 |  |  | 57.1 |  |  | 0.3 |
|  | $ | 7,240.1 |  |  | $ | 6,009.4 |  |  | $ | 13,945.4 |  |  | $ | 10,352.4 |
Segment income 1: |  |  |  |  |  |  |  |
Domestic |  | $ | 141.6 |  |  | $ | 138.1 |  |  | $ | 272.1 |  |  | $ | 212.0 |
Import |  | 275.5 |  |  | 216.3 |  |  | 521.3 |  |  | 317.8 |
Luxury |  | 126.7 |  |  | 97.2 |  |  | 257.1 |  |  | 141.3 |
Total segment income for reportable segments |  | $ | 543.8 |  |  | $ | 451.6 |  |  | $ | 1,050.5 |  |  | $ | 671.1 |
1 Segment income for each of the segments is a Non-GAAP measure defined as Income from operations before income taxes, depreciation and amortization, other interest expense and other income, net. Reconciliation of total segment income for reportable segments to our consolidated income before income taxes:
|  | Three Months Ended June 30, |  | Six Months Ended June 30,
(in millions) |  | 2022 |  | 2021 |  | 2022 |  | 2021
Total segment income for reportable segments |  | $ | 543.8 |  |  | $ | 451.6 |  |  | $ | 1,050.5 |  |  | $ | 671.1 |
Corporate and other |  | 21.6 |  |  | 18.6 |  |  | 62.1 |  |  | 57.4 |
Depreciation and amortization |  | (40.9) |  |  | (30.3) |  |  | (80.2) |  |  | (57.1) |
Other interest expense |  | (34.4) |  |  | (28.1) |  |  | (64.5) |  |  | (51.6) |
Other income (expense), net |  | (21.9) |  |  | 7.6 |  |  | (29.9) |  |  | 11.1 |
Income before income taxes |  | $ | 468.2 |  |  | $ | 419.4 |  |  | $ | 938.0 |  |  | $ | 630.9 |
Total assets by reportable segments is as follows:
(in millions) |  | June 30, 2022 |  | December 31, 2021
Total assets: |  |  |  |
Domestic |  | $ | 2,215.4 |  |  | $ | 1,574.7 |
Import |  | 2,488.5 |  |  | 1,858.1 |
Luxury |  | 1,681.2 |  |  | 1,407.1 |
Corporate and other |  | 6,622.6 |  |  | 6,307.0 |
|  | $ | 13,007.7 |  |  | $ | 11,146.9 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
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