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Intangible Assets and Goodwill | 12 Months Ended
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Dec. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract] |
Intangible Assets and Goodwill | Goodwill and Intangible Assets In accordance with ASC Topic 350, “Intangibles - Goodwill and Other,” we test goodwill for impairment at least annually (as of April 30 of each year) or more frequently if indications of impairment exist. The ASC also states that if an entity determines, based on the assessment of certain qualitative factors, that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then a quantitative goodwill impairment test is unnecessary. In performing a quantitative test for impairment of goodwill, we primarily use the income approach method of valuation that includes the DCF method that utilizes inputs, including projected revenues, margin, terminal growth rates, discount rates and a market capitalization reconciliation. We completed our annual impairment testing as of April 30, 2024 and determined there was no impairment of goodwill. In evaluating the recoverability of our indefinite lived franchise assets, we utilized a multi-period excess earnings method (“MPEEM”) model using unobservable inputs (Level 3) to estimate the fair value of the franchise assets for each of our franchises with recorded franchise assets. The significant assumptions in our MPEEM model include projected revenue, projected operating margins, a discount rate (and estimates in the discount rate inputs) and residual growth rates. We completed our annual impairment testing as of April 30, 2024 and determined there was no impairment of franchise assets. The changes in the carrying amount of goodwill for 2024 and 2023 were as follows:
| Franchised Dealerships Segment |  | EchoPark Segment |  | Powersports Segment |  | Total
| (In millions)
Balance at December 31, 2022 (1) | $ | 221.8 |  |  | $ | — |  |  | $ | 9.2 |  |  | $ | 231.0 |
Additions through current year acquisitions | — |  |  | — |  |  | 11.9 |  |  | 11.9 |
Reductions from dispositions | (1.8) |  |  | — |  |  | — |  |  | (1.8) |
Prior year acquisition allocations | 9.8 |  |  | — |  |  | 2.9 |  |  | 12.7 |
Balance at December 31, 2023 (1) | $ | 229.8 |  |  | $ | — |  |  | $ | 24.0 |  |  | $ | 253.8 |
Additions through current year acquisitions | 8.1 |  |  | — |  |  | 3.3 |  |  | 11.4 |
Reductions from dispositions | (0.2) |  |  | — |  |  | — |  |  | (0.2) |
Prior year acquisition allocations | 93.5 |  |  | — |  |  | — |  |  | 93.5 |
Balance at December 31, 2024 (1) | $ | 331.2 |  |  | $ | — |  |  | $ | 27.3 |  |  | $ | 358.5 |
(1) Net of accumulated impairment losses of $1.1 billion and $202.9 million related to the Franchised Dealerships Segment and the EchoPark Segment, respectively. During the quarter ended September 30, 2024, we identified an error related to the goodwill associated with the purchase of certain franchise assets in a business combination in the year ended December 31, 2021. As a result, we recorded a $93.5 million adjustment to goodwill to provide for deferred income tax liabilities. The changes in the carrying amount of franchise assets for 2024 and 2023 were as follows:
| Franchised Dealerships Segment |  | EchoPark Segment |  | Powersports Segment |  | Total |  |  |
| (In millions)
Balance at December 31, 2022 | $ | 371.7 |  |  | $ | 1.9 |  |  | $ | 23.1 |  |  | $ | 396.7 |  |  |  |
Additions through current year acquisitions | — |  |  | — |  |  | 22.6 |  |  | 22.6 |  |  |  |
Reductions from dispositions | — |  |  | (1.9) |  |  | — |  |  | (1.9) |  |  |  |
Balance at December 31, 2023 | $ | 371.7 |  |  | $ | — |  |  | $ | 45.7 |  |  | $ | 417.4 |  |  |  |
Additions through current year acquisitions | 10.9 |  |  | — |  |  | 2.0 |  |  | 12.9 |  |  |  |
Balance at December 31, 2024 | $ | 382.6 |  |  | $ | — |  |  | $ | 47.7 |  |  | $ | 430.3 |  |  |  |

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-30/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-20/tableOfContent + Details
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