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Retirement Plans and Postretirement Benefits | 12 Months Ended
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Dec. 31, 2023
Retirement Benefits [Abstract] |
Retirement Plans and Postretirement Benefits | RETIREMENT PLANS AND POSTRETIREMENT BENEFITS Company-Sponsored Defined Contribution 401(k) Plan We have a defined contribution 401(k) plan and trust covering substantially all full-time employees. Contributions of $44.0 million, $29.9 million, and $18.8 million were recognized for the years ended December 31, 2023, 2022 and 2021, respectively. Employees may contribute to the plan if they meet certain eligibility requirements. Executive Management Non-Qualified Deferred Compensation and Supplemental Executive Retirement Plan We offer a non-qualified deferred compensation and supplemental executive retirement plan (the “SERP”) to provide certain employees the ability to accumulate assets for retirement on a tax deferred basis. We may, depending on position, also make discretionary contributions to the SERP. These discretionary contributions could vest immediately or over a period of up to five years based on the employee’s age. Additionally, a participant may defer a portion of his or her compensation and receive the deferred amount upon certain events, including termination or retirement. The following is a summary related to our SERP:
|  | Year Ended December 31,
($ in millions) |  | 2023 |  | 2022 |  | 2021
Compensation expense |  | $ | 1.3 |  |  | $ | 1.1 |  |  | $ | 1.4 |
Total discretionary contribution |  | $ | 1.7 |  |  | $ | 1.0 |  |  | $ | 0.9 |
Guaranteed annual return |  | 5.00 | % |  | 5.00 | % |  | 5.00 | %
As of December 31, 2023 and 2022, the balance due to participants was $72.5 million and $63.0 million, respectively, and was included as a component of other long-term liabilities in the Consolidated Balance Sheets. Company-Sponsored Defined Benefit Pension Plan In March 2023, we acquired UK-based Jardine Motors Group UK Limited, which included the assumption of a company-sponsored defined benefit pension plan applicable to a portion of the salaried present and past employees. The pension plan was closed to future accrual in December 2009. The following table shows the changes in the benefit obligation, plan assets, and funded status for 2023 for the pension benefit plan.
($ in millions) |  | 2023 |  |
Change in projected benefit obligation: |  |  |  |
Benefit obligation at beginning of year |  | $ | — |  |  |
Interest cost |  | 6.2 |  |  |
Benefit payments |  | (6.6) |  |  |
Net transfer in (including the effect of any business combinations/divestitures) |  | 172.8 |  |  |
Actuarial gain |  | (3.3) |  |  |
Exchange rate changes |  | 0.9 |  |  |
Benefit obligation at end of year |  | $ | 170.0 |  |  |
Change in plan assets: |  |  |  |
Fair value of plan assets at beginning of year |  | $ | — |  |  |
Actual return on plan assets |  | (2.2) |  |  |
Employer contributions |  | 35.6 |  |  |
Benefit payments |  | (6.6) |  |  |
Net transfer in (including effect of any business combinations/divestitures) |  | 157.5 |  |  |
Exchange rate changes |  | 1.0 |  |  |
Fair value of plan assets at end of year |  | 185.3 |  |  |
Funded status at end of year |  | $ | 15.3 |  |  |
Amounts recognized in Consolidated Balance Sheets: |  |  |  |
Other non-current assets |  | $ | 15.3 |  |  |
Net amount recognized |  | $ | 15.3 |  |  |
Amounts recognized in accumulated other comprehensive income (loss) (pre-tax): |  |  |  |
Net actuarial loss |  | $ | (7.6) |  |  |
The benefit obligation for our pension benefit is the projected benefit obligation based upon credited service as of the measurement date. The December 31, 2023 pension funded status was favorably affected by employer contributions during the period together with an increase in the discount rate, partially offset by lower than expected asset returns. Net Periodic (Benefit) Cost Interest cost represents the increase in the projected benefit obligation, which is a discounted amount, due to the passage of time. The expected return on plan assets reflects the computed amount of current-year earnings from the investment of plan assets using an estimated long-term rate of return.
|  | Year Ended December 31,
($ in millions) |  | 2023 |  |  |  |
Interest cost |  | $ | 6.2 |  |  |  |  |
Expected return on plan assets |  | (8.8) |  |  |  |  |
Net periodic (benefit) cost |  | $ | (2.6) |  |  |  |  |
The components of net periodic pension (benefits) costs are included in other income (expense) in the Consolidated Statements of Operations. Actuarial Assumptions The weighted-average assumptions used to determine the benefit obligation and net periodic pension cost of our pension plan were as follows:
|  | Year Ended December 31,
|  | 2023 |  |  |  |
Actuarial assumption used to determine benefit obligation: |  |  |  |  |  |
Discount rate |  | 4.78 | % |  |  |  |
Actuarial assumption used to determine net periodic pension cost: |  |  |  |  |  |
Discount rate |  | 4.86 | % |  |  |  |
Expected return on plan assets |  | 6.79 | % |  |  |  |
The discount rate used in the determination of pension benefit obligation and pension expense was determined based on a review of long-term high-grade bonds of appropriate duration. The expected return on plan assets assumption is based upon an analysis of historical long-term returns for various investment categories, as measured by appropriate indices and forward looking expectations of returns. These indices are weighted based upon the extent to which plan assets are invested in the particular categories in arriving at our determination of a composite expected return. The expected rate of return on assets has been set in line with the Trustee’s target return. Plan Assets There have been no changes in the methodologies used since the assumption of the pension plan in 2023. The following tables set forth by level, within the fair value hierarchy, the investments at fair value for our company-sponsored pension benefit plan:
|  | As of December 31
|  | 2023 |  |
($ in millions) |  | Level 1 |  | Level 2 |  | Level 3 |  | Total |  |  |  |  |  |  |  |
Diversified Growth Funds |  | $ | — |  |  | $ | 32.4 |  |  | $ | — |  |  | $ | 32.4 |  |  |  |  |  |  |  |  |
Liability Driven Instrument |  | — |  |  | 113.7 |  |  | — |  |  | 113.7 |  |  |  |  |  |  |  |  |
Cash |  | 39.2 |  |  | — |  |  | — |  |  | 39.2 |  |  |  |  |  |  |  |  |
Total investments at fair value |  | $ | 39.2 |  |  | $ | 146.1 |  |  | $ | — |  |  | $ | 185.3 |  |  |  |  |  |  |  |  |
We have formal investment policy guidelines for our company-sponsored pension plan. These guidelines were set by our pension plan Trustee. The Trustee has appointed an investment manager (Fiduciary Manager) to manage the pension plan’s assets on a discretionary basis and to provide investment advisory services to the Trustee. The balance within and between these investments will be determined from time-to-time at the discretion of the Fiduciary Manager, with the objective of maximizing the probability of achieving the pension plan’s investment strategy set by the Trustee, subject to maintaining risk within a limit agreed by the Trustee. The Trustee’s duties include periodically reviewing and modifying those investment policy guidelines as necessary and ensuring that the policy is adhered to and the investment objectives are met. The Trustee’s investment objectives include the acquisition of suitable assets of appropriate liquidity which will generate an overall level of return that is sufficient to meet all liabilities as and when they fall due, and to ensure the security, quality, and profitability of the portfolio as a whole; to limit the risk of the assets failing to meet the liabilities, both over the long-term and on a shorter-term basis; and to minimize the long-term costs of the pension plan by maximizing the return on the assets while having regard to the investment objectives. The investment strategy makes use of three key types of investments: •a range of low-risk instruments that provide a broad match to changes in liability values (including high-quality corporate bonds); •a portfolio of secure income assets; and •a diversified portfolio of return-seeking assets (including equities, listed real assets, diversifying strategies, hedge funds, private markets, alternative credit and downside protection). The pension plan will hold assets in cash and other money market instruments from time to time as may be deemed appropriate. The long-term asset allocation targets adopted by the Fiduciary Manager is set out below:
Liability matching | 38 | %
Secure income | 8 | %
Diversified return seeking | 54 | %
Periodically, the Trustee reviews the target allocations to determine what adjustments should be made based on changing economic and market conditions and specific liquidity requirements. We currently do not anticipate making any cash contributions to the plan in 2024. Estimated future benefit payments are as follows for the years indicated:
($ in millions) | Pension Benefit Plans
2024 | $ | 8.8 |
2025 | 9.2 |
2026 | 9.9 |
2027 | 10.0 |
2028 | 10.1 |
2029 - 2033 | 50.6 |

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