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Intangible Franchise Rights and Goodwill
 12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
INTANGIBLE FRANCHISE RIGHTS AND GOODWILL INTANGIBLE FRANCHISE RIGHTS AND GOODWILL
As discussed in Note 1 “Business and Summary of Significant Accounting Policies,” the Company evaluates its intangible assets, consisting entirely of indefinite-lived franchise rights and goodwill assets, for impairment annually, or more frequently if events or circumstances indicate possible impairment. In the third quarter of 2019, the ongoing uncertainty related to the ultimate resolution of the Referendum of the U.K.’s Membership of the EU advising for Brexit, continued to generate much uncertainty in the U.K., as well as in global markets. During the three months ended September 30, 2019, as a result of increased uncertainty in the U.K. regarding the outcome and timing of Brexit and the related impact on the Company’s U.K. new vehicle business and certain U.S. dealerships identified in its third quarter review, the Company identified circumstances indicating possible impairment of certain franchise rights, requiring a quantitative assessment as of August 31, 2019. In estimating fair value, the Company used a discounted cash flow model, or income approach, specifically the excess earnings method. Significant inputs to the model included changes in revenue growth rates, future gross margins, future SG&A expenses, terminal growth rates and the WACC. Based on the results of the Company's assessment, the Company determined that the fair value of the franchise rights on seven of its U.K. dealerships and one of its U.S. dealerships were below their respective carrying values. This resulted in franchise rights impairment charges of $5.6 million in the U.K segment and $3.0 million in the U.S. segment. The impairment charges were recognized within Asset impairments in the Company's Consolidated Statements of Operations.
The Company performed its annual impairment assessment of the carrying value of its goodwill and intangible franchise rights as of October 31, 2019. For the goodwill test, the Company elected to perform a qualitative assessment of each of its reporting units and determined that it was not more likely than not that the fair value of the reporting unit was less than its respective carrying amount. Thus, no goodwill impairment was recorded for the year ended December 31, 2019. The Company elected to perform a qualitative assessment as of October 31, 2019 to determine whether it was more likely than not that the carrying value of the franchise rights were more than their respective fair values. Based on the results of the qualitative assessment, the Company identified circumstances indicating possible impairment of certain of its franchise rights, requiring a quantitative assessment as of October 31, 2019, which was performed using the same methodology discussed above as of August 31, 2019. This resulted in additional franchise rights impairment charges of $10.4 million in the U.S. segment during the fourth quarter of 2019.
During the years ended December 31, 2019 and 2018, the Company recorded additional indefinite-lived intangible franchise rights associated with acquisitions of $12.1 million and $11.5 million, respectively, in the U.S segment. During the year ended December 31, 2018, the Company recorded additional indefinite-lived intangibles associated with acquisitions of $8.4 million, in the U.K. segment.
See Note 3 “Acquisitions and Dispositions” for additional discussion.
The following table presents the Company’s intangible franchise rights balances by reportable segment as of December 31, 2019 and 2018 (in millions):
 
 
Intangible Franchise Rights
 
 
U.S.
 
U.K.
 
Brazil
 
Total
Balance, December 31, 2018
 
$
224.4

 
$
35.1

 
$
0.1

 
$
259.6

Balance, December 31, 2019
 
$
223.1

 
$
30.4


$
0.1

 
$
253.5


The following is a roll-forward of the Company’s goodwill accounts by reportable segment (in millions):
 
 
Goodwill
 
 
U.S.
 
U.K.
 
Brazil
 
Total
Balance, December 31, 2017 (1)
 
$
835.3

 
$
65.0

 
$
12.7

 
$
913.0

Additions through acquisitions
 
39.7

 
28.5

 
4.3

 
72.5

Disposals
 
(13.4
)
 
—

 
—

 
(13.4
)
Currency translation
 
—

 
(5.9
)
 
(2.3
)
 
(8.2
)
Balance, December 31, 2018 (1)
 
$
861.6

 
$
87.6


$
14.7

 
$
963.9

Additions through acquisitions
 
42.0

 
1.3

 
—

 
43.3

Disposals
 
(1.3
)
 
—

 
(0.3
)
 
(1.6
)
Currency translation
 
—

 
3.2

 
(0.5
)
 
2.7

Balance, December 31, 2019 (1)
 
$
902.3

 
$
92.1


$
13.9

 
$
1,008.3


(1) Net of accumulated impairments of $97.8 million