Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 1-13107

AUTONATION, INC.

(Exact name of registrant as specified in its charter)

Delaware

73-1105145

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

200 SW 1st Avenue

Fort Lauderdale

Florida

33301

(Address of principal executive offices)

(Zip Code)

(954)769-6000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.01 per share

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

As of October 25, 2023, the registrant had 42,520,469 shares of common stock outstanding.

AUTONATION, INC.

FORM 10-Q

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION
		Page
Item 1.	Financial Statements
	Unaudited Condensed Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022	1
	Unaudited Condensed Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2023 and 2022	2
	Unaudited Condensed Consolidated Statements of Shareholders’ Equity for the Three and Nine Months Ended September 30, 2023 and 2022	3
	Unaudited Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2023 and 2022	4
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	52
Item 4.	Controls and Procedures	52
PART II. OTHER INFORMATION
Item 1A.	Risk Factors	54
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	54
Item 5.	Other Information	54
Item 6.	Exhibits	55

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

AUTONATION, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except share and per share data)


	September 30, 2023		December 31, 2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	64.0	$	72.6
Receivables, net	877.3		858.8
Inventory	2,645.6		2,048.3
Other current assets	186.2		158.3
Total Current Assets	3,773.1		3,138.0
AUTO LOANS RECEIVABLE, net of allowance for credit losses of $47.9 million and $57.5 million, respectively	320.0		303.1
PROPERTY AND EQUIPMENT, net of accumulated depreciation of $2.1 billion and $1.9 billion, respectively	3,723.5		3,607.2
OPERATING LEASE ASSETS	371.0		323.5
GOODWILL	1,455.7		1,320.1
OTHER INTANGIBLE ASSETS, NET	931.8		837.0
OTHER ASSETS	665.9		530.8
Total Assets	$	11,241.0	$	10,059.7
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Vehicle floorplan payable - trade	$	1,358.7	$	946.6
Vehicle floorplan payable - non-trade	1,456.1		1,162.7
Accounts payable	341.6		327.6
Commercial paper	350.0		50.0
Current maturities of long-term debt	12.8		12.6
Current portion of non-recourse debt	7.2		10.7
Accrued payroll and benefits	282.7		238.0
Other current liabilities	722.7		657.5
Total Current Liabilities	4,531.8		3,405.7
LONG-TERM DEBT, NET OF CURRENT MATURITIES	3,579.6		3,586.9
NON-RECOURSE DEBT, NET OF CURRENT PORTION	238.9		312.9
NONCURRENT OPERATING LEASE LIABILITIES	339.3		296.9
DEFERRED INCOME TAXES	60.4		76.5
OTHER LIABILITIES	349.0		333.0
COMMITMENTS AND CONTINGENCIES (Note 14)
SHAREHOLDERS’ EQUITY:

Common stock, par value $0.01 per share; 1,500,000,000 shares authorized; 63,562,149 shares issued at September 30, 2023, and December 31, 2022, including shares held in treasury	0.6		0.6
Additional paid-in capital	18.6		3.1
Retained earnings	4,426.8		3,663.7
Treasury stock, at cost; 20,790,347 and 15,915,358 shares held, respectively	(2,304.0)		(1,619.6)
Total Shareholders’ Equity	2,142.0		2,047.8
Total Liabilities and Shareholders’ Equity	$	11,241.0	$	10,059.7

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

AUTONATION, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share data)


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Revenue:
New vehicle	$	3,187.6	$	2,863.9	$	9,400.5	$	8,606.9
Used vehicle	2,172.1		2,401.7		6,292.7		7,494.5
Parts and service	1,157.4		1,032.1		3,392.5		3,072.3
Finance and insurance, net	369.5		360.7		1,071.4		1,092.2
Other	6.1		7.6		24.4		22.1
TOTAL REVENUE	6,892.7		6,666.0		20,181.5		20,288.0
Cost of sales:
New vehicle	2,936.9		2,534.2		8,575.2		7,578.7
Used vehicle	2,044.3		2,259.7		5,876.2		7,059.4
Parts and service	611.6		553.5		1,793.1		1,650.9
Other	5.3		5.8		20.7		15.6
TOTAL COST OF SALES	5,598.1		5,353.2		16,265.2		16,304.6
Gross profit:
New vehicle	250.7		329.7		825.3		1,028.2
Used vehicle	127.8		142.0		416.5		435.1
Parts and service	545.8		478.6		1,599.4		1,421.4
Finance and insurance	369.5		360.7		1,071.4		1,092.2
Other	0.8		1.8		3.7		6.5
TOTAL GROSS PROFIT	1,294.6		1,312.8		3,916.3		3,983.4
Selling, general, and administrative expenses	819.3		763.2		2,444.9		2,259.4
Depreciation and amortization	55.7		50.1		163.1		148.9


Other (income) expense, net	0.1		(23.0)		6.3		(24.5)
OPERATING INCOME	419.5		522.5		1,302.0		1,599.6
Non-operating income (expense) items:
Floorplan interest expense	(38.3)		(10.7)		(98.2)		(21.7)
Other interest expense	(48.8)		(33.7)		(135.9)		(97.4)
Other income (loss), net	(5.0)		(4.6)		4.6		(24.7)
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	327.4		473.5		1,072.5		1,455.8
Income tax provision	83.7		120.8		268.5		364.5
NET INCOME FROM CONTINUING OPERATIONS	243.7		352.7		804.0		1,091.3
Income (loss) from discontinued operations, net of income taxes	—		(0.1)		0.9		(0.3)
NET INCOME	$	243.7	$	352.6	$	804.9	$	1,091.0
BASIC EARNINGS (LOSS) PER SHARE:
Continuing operations	$	5.59	$	6.35	$	17.75	$	18.65
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.59	$	6.35	$	17.77	$	18.65
Weighted average common shares outstanding	43.6		55.5		45.3		58.5
DILUTED EARNINGS (LOSS) PER SHARE:
Continuing operations	$	5.54	$	6.31	$	17.63	$	18.53
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.54	$	6.31	$	17.65	$	18.52
Weighted average common shares outstanding	44.0		55.9		45.6		58.9
COMMON SHARES OUTSTANDING, net of treasury stock, at period end	42.8		52.3		42.8		52.3

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

AUTONATION, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In millions, except share data)


	Nine Months Ended September 30, 2023
	Common Stock			Additional Paid-In Capital		Retained Earnings		Treasury Stock		Total
	Shares	Amount
BALANCE AT DECEMBER 31, 2022	63,562,149	$	0.6	$	3.1	$	3,663.7	$	(1,619.6)	$	2,047.8
Net income	—	—		—		288.7		—		288.7
Repurchases of common stock, including excise tax	—	—		—		—		(307.5)		(307.5)
Stock-based compensation expense	—	—		15.1		—		—		15.1
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	—	—		(15.2)		(41.8)		33.2		(23.8)

BALANCE AT MARCH 31, 2023	63,562,149	$	0.6	$	3.0	$	3,910.6	$	(1,893.9)	$	2,020.3
Net income	—	—		—		272.5		—		272.5
Repurchases of common stock, including excise tax	—	—		—		—		(209.5)		(209.5)
Stock-based compensation expense	—	—		8.3		—		—		8.3
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	—	—		(0.3)		—		0.5		0.2
BALANCE AT JUNE 30, 2023	63,562,149	$	0.6	$	11.0	$	4,183.1	$	(2,102.9)	$	2,091.8
Net income	—	—		—		243.7		—		243.7
Repurchases of common stock, including excise tax	—	—		—		—		(202.0)		(202.0)
Stock-based compensation expense	—	—		8.2		—		—		8.2
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	—	—		(0.6)		—		0.9		0.3
BALANCE AT SEPTEMBER 30, 2023	63,562,149	$	0.6	$	18.6	$	4,426.8	$	(2,304.0)	$	2,142.0


	Nine Months Ended September 30, 2022
	Common Stock			Additional Paid-In Capital		Retained Earnings		Treasury Stock		Total
	Shares	Amount
BALANCE AT DECEMBER 31, 2021	86,562,149	$	0.8	$	3.2	$	4,639.9	$	(2,266.9)	$	2,377.0
Net income	—	—		—		362.1		—		362.1
Repurchases of common stock	—	—		—		—		(380.9)		(380.9)
Stock-based compensation expense	—	—		15.9		—		—		15.9
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	—	—		(16.7)		(58.1)		46.3		(28.5)

BALANCE AT MARCH 31, 2022	86,562,149	$	0.8	$	2.4	$	4,943.9	$	(2,601.5)	$	2,345.6
Net income	—	—		—		376.3		—		376.3
Repurchases of common stock	—	—		—		—		(403.9)		(403.9)

Stock-based compensation expense	—	—		5.3		—		—		5.3
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	—	—		(2.5)		—		4.2		1.7
BALANCE AT JUNE 30, 2022	86,562,149	$	0.8	$	5.2	$	5,320.2	$	(3,001.2)	$	2,325.0
Net income	—	—		—		352.6		—		352.6
Repurchases of common stock	—	—		—		—		(428.2)		(428.2)
Stock-based compensation expense	—	—		5.1		—		—		5.1
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	—	—		(1.0)		—		1.7		0.7
BALANCE AT SEPTEMBER 30, 2022	86,562,149	$	0.8	$	9.3	$	5,672.8	$	(3,427.7)	$	2,255.2

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

AUTONATION, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)


	Nine Months Ended
	September 30,
	2023		2022
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Net income	$	804.9	$	1,091.0
Adjustments to reconcile net income to net cash provided by operating activities:
(Income) loss from discontinued operations	(0.9)		0.3
Depreciation and amortization	163.1		148.9
Amortization of debt issuance costs and accretion of debt discounts	7.0		4.5
Stock-based compensation expense	31.6		26.3
Provision for credit losses on auto loans receivable	36.0		—
Deferred income tax provision	5.1		5.5
Net gain related to business/property dispositions	(1.1)		(17.1)





(Gain) loss on corporate-owned life insurance asset	(4.9)		26.0
Gain on sale of auto loans receivable	(8.1)		—
Other	6.2		1.1
(Increase) decrease, net of effects from business acquisitions and divestitures:
Receivables	(15.1)		80.3
Auto loans receivable, net	(112.7)		—
Inventory	(563.0)		(9.1)
Other assets	(108.2)		(28.6)
Increase (decrease), net of effects from business acquisitions and divestitures:
Vehicle floorplan payable - trade	412.0		124.0
Accounts payable	6.4		(52.2)
Other liabilities	104.6		42.7
Net cash provided by continuing operations	762.9		1,443.6
Net cash used in discontinued operations	(0.3)		(0.3)
Net cash provided by operating activities	762.6		1,443.3
CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES:
Purchases of property and equipment	(286.0)		(236.2)


Proceeds from the disposal of assets held for sale	2.5		22.8

Cash received from business divestitures, net of cash relinquished	—		55.2
Cash used in business acquisitions, net of cash acquired	(271.1)		—
Originations of auto loans receivable acquired through third-party dealers	(110.9)		—
Collections on auto loans receivable acquired through third-party dealers	110.1		—


Proceeds from the sale of auto loans receivable	68.7		—
Deposits for investment	—		(81.6)
Other	(10.3)		(7.5)
Net cash used in continuing operations	(497.0)		(247.3)
Net cash used in discontinued operations	—		—
Net cash used in investing activities	(497.0)		(247.3)

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

AUTONATION, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Continued)


	Nine Months Ended
	September 30,
	2023		2022
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES:
Repurchases of common stock	(723.2)		(1,177.4)



Proceeds from 3.85% Senior Notes due 2032	—		698.8


Net proceeds from (payments of) commercial paper	300.0		(340.0)
Proceeds from non-recourse debt	151.6		—
Payments of non-recourse debt	(232.1)		—
Payment of debt issuance costs	(6.6)		(6.6)
Net proceeds from vehicle floorplan payable - non-trade	260.4		46.4
Payments of other debt obligations	(9.4)		(8.7)
Proceeds from the exercise of stock options	1.9		3.4
Payments of tax withholdings for stock-based awards	(25.2)		(29.5)

Net cash used in continuing operations	(282.6)		(813.6)
Net cash used in discontinued operations	—		—
Net cash used in financing activities	(282.6)		(813.6)
INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	(17.0)		382.4
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH at beginning of period	95.4		60.6
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH at end of period	$	78.4	$	443.0

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

Table of Contents

AUTONATION, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In millions, except per share data)

1.INTERIM FINANCIAL STATEMENTS

Business and Basis of Presentation

AutoNation, Inc., through its subsidiaries, is one of the largest automotive retailers in the United States. As of September 30, 2023, we owned and operated 354 new vehicle franchises from 253 stores located in the United States, predominantly in major metropolitan markets in the Sunbelt region. Our stores, which we believe include some of the most recognizable and well-known in our key markets, sell 34 different new vehicle brands. The core brands of new vehicles that we sell, representing approximately 88% of the new vehicles that we sold during the nine months ended September 30, 2023, are manufactured by Toyota (including Lexus), Honda, Ford, General Motors, BMW, Mercedes-Benz, Stellantis, and Volkswagen (including Audi and Porsche). As of September 30, 2023, we also owned and operated 53 AutoNation-branded collision centers, 17 AutoNation USA used vehicle stores, 4 AutoNation-branded automotive auction operations, 3 parts distribution centers, a mobile automotive repair and maintenance business, and an auto finance company.

We offer a diversified range of automotive products and services, including new vehicles, used vehicles, “parts and service” (also referred to as “After-Sales”), which includes automotive repair and maintenance services as well as wholesale parts and collision businesses, and automotive “finance and insurance” products (also referred to as “Customer Financial Services”), which include vehicle service and other protection products, as well as the arranging of financing for vehicle purchases through third-party finance sources. We also offer indirect financing on certain vehicles we sell through our captive finance company. For convenience, the terms “AutoNation,” “Company,” and “we” are used to refer collectively to AutoNation, Inc. and its subsidiaries, unless otherwise required by the context. Our store and other operations are conducted by our subsidiaries.

The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of AutoNation, Inc. and its subsidiaries; intercompany accounts and transactions have been eliminated. The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. Additionally, operating results for interim periods are not necessarily indicative of the results that can be expected for a full year. The Unaudited Condensed Consolidated Financial Statements herein should be read in conjunction with our audited Consolidated Financial Statements and notes thereto included within our most recent Annual Report on Form 10-K. These Unaudited Condensed Consolidated Financial Statements reflect, in the opinion of management, all material adjustments (which include only normal recurring adjustments) necessary to fairly state, in all material respects, our financial position and results of operations for the periods presented.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. In preparing these financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements. We base our estimates and judgments on historical experience and other assumptions that we believe are reasonable. However, application of these accounting policies involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ materially from these estimates. We periodically evaluate estimates and assumptions used in the preparation of the financial statements and make changes on a prospective basis when adjustments are necessary. Such estimates and assumptions affect, among other things, our goodwill, indefinite-lived intangible asset, and long-lived asset valuations; inventory valuation; equity investment valuation; assets held for sale; assessments of variable consideration and related constraints related to retrospective commissions; accruals for chargebacks against revenue recognized from the sale of finance and insurance products; accruals related to self-insurance programs; certain legal proceedings; assessment of the annual income tax expense; valuation of deferred income taxes and income tax contingencies; the allowance for expected credit losses; and measurement of performance-based compensation costs.

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AUTONATION, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

2. REVENUE RECOGNITION

Disaggregation of Revenue

The significant majority of our revenue is from contracts with customers. Taxes assessed by governmental authorities that are directly imposed on revenue transactions are excluded from revenue and expenses. In the following tables, revenue is disaggregated by major lines of goods and services and timing of transfer of goods and services. The tables also include a reconciliation of the disaggregated revenue to reportable segment revenue.


	Three Months Ended September 30, 2023
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	916.1	$	1,042.5	$	1,229.0	$	—	$	3,187.6
Used vehicle	649.1		602.4		773.1		147.5		2,172.1
Parts and service	301.7		299.6		402.4		153.7		1,157.4
Finance and insurance, net	115.6		129.1		111.5		13.3		369.5
Other	1.4		3.6		0.1		1.0		6.1
	$	1,983.9	$	2,077.2	$	2,516.1	$	315.5	$	6,892.7

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	1,765.2	$	1,841.7	$	2,175.5	$	211.3	$	5,993.7
Goods and services transferred over time(2)	218.7		235.5		340.6		104.2		899.0
	$	1,983.9	$	2,077.2	$	2,516.1	$	315.5	$	6,892.7


	Three Months Ended September 30, 2022
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	875.0	$	814.1	$	1,174.8	$	—	$	2,863.9
Used vehicle	764.3		667.4		853.0		117.0		2,401.7
Parts and service	275.8		266.2		364.5		125.6		1,032.1
Finance and insurance, net	117.1		123.1		112.5		8.0		360.7
Other	0.6		4.4		1.6		1.0		7.6
	$	2,032.8	$	1,875.2	$	2,506.4	$	251.6	$	6,666.0

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	1,839.4	$	1,673.0	$	2,199.8	$	169.9	$	5,882.1
Goods and services transferred over time(2)	193.4		202.2		306.6		81.7		783.9
	$	2,032.8	$	1,875.2	$	2,506.4	$	251.6	$	6,666.0

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AUTONATION, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)


	Nine Months Ended September 30, 2023
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	2,667.1	$	2,910.1	$	3,823.3	$	—	$	9,400.5
Used vehicle	1,880.4		1,707.7		2,275.8		428.8		6,292.7
Parts and service	888.0		859.3		1,188.9		456.3		3,392.5
Finance and insurance, net	332.2		369.5		332.3		37.4		1,071.4
Other	2.8		17.6		1.2		2.8		24.4
	$	5,770.5	$	5,864.2	$	7,621.5	$	925.3	$	20,181.5

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	5,134.6	$	5,200.1	$	6,613.1	$	616.7	$	17,564.5
Goods and services transferred over time(2)	635.9		664.1		1,008.4		308.6		2,617.0
	$	5,770.5	$	5,864.2	$	7,621.5	$	925.3	$	20,181.5


	Nine Months Ended September 30, 2022
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	2,555.6	$	2,548.1	$	3,503.2	$	—	$	8,606.9
Used vehicle	2,374.2		2,074.6		2,673.7		372.0		7,494.5
Parts and service	820.0		788.0		1,083.4		380.9		3,072.3
Finance and insurance, net	355.7		375.2		338.1		23.2		1,092.2
Other	2.6		13.1		3.3		3.1		22.1
	$	6,108.1	$	5,799.0	$	7,601.7	$	779.2	$	20,288.0

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	5,538.8	$	5,205.8	$	6,697.5	$	536.0	$	17,978.1
Goods and services transferred over time(2)	569.3		593.2		904.2		243.2		2,309.9
	$	6,108.1	$	5,799.0	$	7,601.7	$	779.2	$	20,288.0

(1) “Corporate and other” is comprised of our other businesses, including AutoNation USA used vehicle stores, collision centers, parts distribution centers, auction operations, and our mobile automotive repair and maintenance business.

(2) Represents revenue recognized during the period for automotive repair and maintenance services.

Transaction Price Allocated to Remaining Performance Obligations

We sell a vehicle maintenance program (the AutoNation Vehicle Care Program or “VCP”) under which a customer purchases a specific number of maintenance services to be redeemed at an AutoNation location over a five-year term from the date of purchase. We satisfy our performance obligations related to this program and recognize revenue as the maintenance services are rendered, since the customer benefits when we have completed the maintenance service.

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The following table includes estimated revenue expected to be recognized in the future related to VCP performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period:


	Revenue Expected to Be Recognized by Period
	Total		Next 12 Months		13 - 36 Months		37 - 60 Months
Revenue expected to be recognized on VCP contracts sold as of period end	$	106.2	$	36.2	$	51.6	$	18.4

As a practical expedient, since automotive repair and maintenance services are performed within one year or less, we do not disclose estimated revenue expected to be recognized in the future for automotive repair and maintenance performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period or when we expect to recognize such revenue.

Contract Assets and Liabilities

When the timing of our provision of goods or services is different from the timing of payments made by our customers, we recognize either a contract asset (performance precedes contractual due date) or a contract liability (customer payment precedes performance). Contract assets primarily relate to our right to consideration for work in process not yet billed at the reporting date associated with automotive repair and maintenance services, as well as our estimate of variable consideration that has been included in the transaction price for certain finance and insurance products (retrospective commissions). These contract assets are reclassified to receivables when the right to consideration becomes unconditional. Contract liabilities primarily relate to upfront payments received from customers for the sale of VCP contracts.

Our receivables from contracts with customers are included in Receivables, net, our current contract asset is included in Other Current Assets, our long-term contract asset is included in Other Assets, our current contract liability is included in Other Current Liabilities, and our long-term contract liability is included in Other Liabilities in our Unaudited Condensed Consolidated Balance Sheets.

The following table provides the balances of our receivables from contracts with customers and our current and long-term contract assets and contract liabilities:


	September 30, 2023		December 31, 2022
Receivables from contracts with customers, net	$	629.1	$	634.5
Contract Asset (Current)	$	22.5	$	27.7
Contract Asset (Long-Term)	$	3.4	$	8.6
Contract Liability (Current)	$	41.9	$	41.8
Contract Liability (Long-Term)	$	70.0	$	66.6

The change in the balances of our contract assets and contract liabilities primarily result from the timing differences between our performance and the customer’s payment, as well as changes in the estimated transaction price related to variable consideration for performance obligations satisfied in previous periods. The following table presents revenue recognized during the period from amounts included in the contract liability balance at the beginning of the period and adjustments to revenue related to performance obligations satisfied in previous periods:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amounts included in contract liability at the beginning of the period	$	8.5	$	8.1	$	26.9	$	25.9
Performance obligations satisfied in previous periods	$	4.1	$	(0.9)	$	1.5	$	3.8

Other significant changes include contract assets reclassified to receivables of $28.7 million for the nine months ended September 30, 2023, and $30.5 million for the nine months ended September 30, 2022.

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3.EARNINGS PER SHARE

Basic earnings per share (“EPS”) is computed by dividing net income by the weighted average number of common shares outstanding for the period, including vested restricted stock unit (“RSU”) awards. Diluted EPS is computed by dividing net income by the weighted average number of shares outstanding, noted above, including the dilutive effect of unvested RSU awards and stock options.

The following table presents the calculation of basic and diluted EPS:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Net income from continuing operations	$	243.7	$	352.7	$	804.0	$	1,091.3
Income (loss) from discontinued operations, net of income taxes	—		(0.1)		0.9		(0.3)
Net income	$	243.7	$	352.6	$	804.9	$	1,091.0

Basic weighted average common shares outstanding	43.6		55.5		45.3		58.5
Dilutive effect of unvested RSUs and stock options	0.4		0.4		0.3		0.4
Diluted weighted average common shares outstanding	44.0		55.9		45.6		58.9

Basic EPS amounts(1):
Continuing operations	$	5.59	$	6.35	$	17.75	$	18.65
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.59	$	6.35	$	17.77	$	18.65

Diluted EPS amounts(1):
Continuing operations	$	5.54	$	6.31	$	17.63	$	18.53
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.54	$	6.31	$	17.65	$	18.52

(1) EPS amounts are calculated discretely and, therefore, may not add up to the total due to rounding.

A summary of anti-dilutive equity instruments excluded from the computation of diluted EPS is as follows:


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2023	2022	2023	2022
Anti-dilutive equity instruments excluded from the computation of diluted EPS	—	0.1	—	0.1

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(Continued)

4.RECEIVABLES, NET

The components of receivables, net of allowances for expected credit losses, are as follows:


	September 30, 2023		December 31, 2022
Contracts-in-transit and vehicle receivables	$	408.0	$	441.1
Trade receivables	172.4		156.6
Manufacturer receivables	212.3		174.4
Income taxes receivable (see Note 9)	24.8		20.2
Other	61.8		68.2
	879.3		860.5
Less: allowances for expected credit losses	(2.0)		(1.7)
Receivables, net	$	877.3	$	858.8

Contracts-in-transit and vehicle receivables primarily represent receivables from financial institutions for the portion of the vehicle sales price financed by our customers. Trade receivables represent amounts due for parts and services sold, excluding amounts due from manufacturers, as well as receivables from finance organizations for commissions on the sale of finance and insurance products. Manufacturer receivables represent amounts due from manufacturers for holdbacks, rebates, incentives, floorplan assistance, and warranty claims. We evaluate our receivables for collectability based on past collection experience, current information, and reasonable and supportable forecasts.

5.AUTO LOANS RECEIVABLE

Auto loans receivable include amounts due from customers related to retail vehicle sales financed through our auto finance company (referred to as AutoNation Finance), as well as retail vehicle installment sales contracts acquired through third-party independent dealers. In September 2023, we discontinued acquiring installment sales contracts through third-party independent dealers. Auto loans receivable are presented net of an allowance for expected credit losses. Auto loans receivable represent a large group of smaller-balance homogeneous loans, which we consider to be part of one class of financing receivable and one portfolio segment for purposes of determining our allowance for expected credit losses.

AutoNation Finance operating results include the interest and fee income generated by auto loans receivable less the interest expense associated with the debt issued to fund these receivables, a provision for estimated credit losses, and direct expenses, as well as gains or losses on the sale of auto loans receivable. AutoNation Finance income (loss) is included as a component of Other (Income) Expense, Net (within Operating Income). Interest income on auto loans receivable is recognized when earned based on contractual loan terms. Direct costs associated with loan originations are capitalized and amortized using the effective interest method.

Auto Loans Receivable, Net

The components of auto loans receivable, net of unearned discounts and allowances for expected credit losses, at September 30, 2023, and December 31, 2022, are as follows:


	September 30, 2023		December 31, 2022




Total auto loans receivable	$	373.6	$	377.0
Accrued interest and fees	4.1		4.4
Deferred loan origination costs	0.7		0.5
Less: unearned discounts	(10.5)		(21.3)
Less: allowances for expected credit losses	(47.9)		(57.5)
Auto loans receivable, net	$	320.0	$	303.1

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Credit Quality

We utilize proprietary credit scoring models to rate the risk of default for customers that apply for financing by evaluating customer credit history and certain credit application information. Our evaluation considers information such as payment history for prior or existing credit accounts, as well as application information such as income, collateral, and down payment. The scoring models yield credit program tiers that represent the relative likelihood of repayment. The assigned credit tier influences the terms of the agreement, such as the required loan-to-value ratio and interest rate. After origination, credit tier assignments by customer are generally not updated.

We monitor the credit quality of the auto loans receivable on an ongoing basis and also validate the accuracy of the credit scoring models periodically. Loan performance is reviewed on a recurring basis to identify whether the assigned credit tiers adequately reflect the customers’ likelihood of repayment, and if needed, adjustments are made to the scoring models on a prospective basis.

Auto Loans Receivable by Major Credit Program

The following tables present auto loans receivable as of September 30, 2023, and December 31, 2022, disaggregated by major credit program tier:



	Fiscal Year of Origination
As of September 30, 2023	2023		2022		2021		2020		2019		Prior to 2019		Total
Credit Program Tier(1):
Platinum	$	70.4	$	16.5	$	9.2	$	4.0	$	4.0	$	0.7	$	104.8
Gold	52.8		39.8		21.0		8.2		5.8		1.2		128.8
Silver	50.4		37.4		19.2		6.3		3.9		0.6		117.8
Bronze	6.2		1.4		7.3		1.9		0.1		0.1		17.0
Copper	0.4		0.4		3.5		0.7		0.1		0.1		5.2
Total auto loans receivable	$	180.2	$	95.5	$	60.2	$	21.1	$	13.9	$	2.7	$	373.6

Current-period gross write-offs	$	4.5	$	27.3	$	12.5	$	3.7	$	2.1	$	0.6	$	50.7

	Fiscal Year of Origination
As of December 31, 2022	2022		2021		2020		2019		2018		Prior to 2018		Total
Credit Program Tier(1):
Platinum	$	21.9	$	12.9	$	6.4	$	7.4	$	2.2	$	0.2	$	51.0
Gold	53.7		30.0		12.9		10.6		3.2		0.4		110.8
Silver	61.9		29.8		10.4		8.0		1.9		0.1		112.1
Bronze	41.4		17.1		7.4		3.7		1.0		0.1		70.7
Copper	19.2		8.0		2.6		1.8		0.7		0.1		32.4
Total auto loans receivable	$	198.1	$	97.8	$	39.7	$	31.5	$	9.0	$	0.9	$	377.0

(1) Classified based on credit grade assigned when customer was initially approved for financing.

Allowance for Credit Losses

The allowance for credit losses represents the net credit losses expected over the remaining contractual life of our auto loans receivable. The allowance for credit losses is determined using a vintage-level statistical model that captures the relationship between historical changes in gross losses and the lifetime loss curves by month on book, credit tiers at origination, and seasonality, adjusted for expected recoveries based on historical recovery trends. The credit loss model also incorporates reasonable and supportable forecasts about the future utilizing a forecast of a macroeconomic variable, specifically, the change

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in U.S. disposable personal income, which we believe is most strongly correlated to evaluating and predicting expected credit losses of our auto loans receivable. We utilize a reasonable and supportable forecast period of one year, after which we immediately revert to historical experience.

We periodically consider whether the use of alternative variables would result in improved credit loss model accuracy and revise the model when appropriate. We also consider whether qualitative adjustments are necessary for factors that are not reflected in the quantitative methods but impact the measurement of estimated credit losses. Such adjustments include the expectations of the impact of recent economic trends on customer behavior.

The net loss estimate is calculated by applying the loss rates developed using the methods described above to the amortized cost basis of the auto loans receivable. The change in the allowance for credit losses is recognized through an adjustment to the provision for credit losses.

Rollforward of Allowance for Credit Losses

The following is a rollforward of our allowance for expected credit losses for auto loans receivable for the nine months ended September 30, 2023:


	Nine Months Ended
	September 30, 2023
Balance as of beginning of year	$	57.5
Provision for credit losses	36.0

Write-offs	(50.7)
Recoveries(1)	21.2
Sold loans	(16.1)
Balance as of September 30, 2023	$	47.9

(1) Includes proceeds from the recovery of vehicle collateral, net of costs incurred.

During the three and nine months ended September 30, 2023, we sold loans with an aggregate amortized cost of $60.6 million, net of allowance for expected credit losses of $16.1 million, for cash proceeds of $68.7 million. We recorded a net gain on sale of $8.1 million pre-tax. We have no continuing involvement in the sold loans as they were sold without recourse to us for their post-sale performance.

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Past Due Auto Loans Receivable

An account is considered delinquent if 95% of the required principal and interest payments have not been received as of the date such payments were due. All loans continue to accrue interest until repayment, write-off, or when a loan reaches 75 days past due. If payment is received after a loan has stopped accruing interest due to reaching 75 days past due, the loan will be deemed current and the accrual of interest resumes. When a write-off occurs, accrued interest is written off by reversing interest income. Payments received on nonaccrual assets are recorded using a combination of the cost recovery method and the cash basis method depending on whether the related loan has been written off. In general, accounts are written off on the last business day of the month during which the earliest of the following occurs: the receivable is 120 days or more delinquent as of the last business day of the month, the vehicle has been repossessed and liquidated, or the related vehicle has been in repossession inventory for at least 60 days. The following table presents past due auto loans receivable, as of September 30, 2023, and December 31, 2022:


	Age Analysis of Past-Due Auto Loans Receivable as of
	September 30, 2023		December 31, 2022
31-60 Days	$	18.6	$	13.0
61-90 Days	5.5		4.1
Greater than 90 Days	3.7		2.6
Total Past Due	$	27.8	$	19.7

Current	345.8		357.3
Total	$	373.6	$	377.0

6.INVENTORY AND VEHICLE FLOORPLAN PAYABLE

The components of inventory are as follows:


	September 30, 2023		December 31, 2022
New vehicles	$	1,578.7	$	1,009.7
Used vehicles	801.0		789.1
Parts, accessories, and other	265.9		249.5
Inventory	$	2,645.6	$	2,048.3

The components of vehicle floorplan payable are as follows:


	September 30, 2023		December 31, 2022
Vehicle floorplan payable - trade	$	1,358.7	$	946.6
Vehicle floorplan payable - non-trade	1,456.1		1,162.7
Vehicle floorplan payable	$	2,814.8	$	2,109.3

Vehicle floorplan payable-trade reflects amounts borrowed to finance the purchase of specific new and, to a lesser extent, used vehicle inventories with the corresponding manufacturers’ captive finance subsidiaries (“trade lenders”). Vehicle floorplan payable-non-trade represents amounts borrowed to finance the purchase of specific new and, to a lesser extent, used vehicle inventories with non-trade lenders, as well as amounts borrowed under our secured used vehicle floorplan facilities. Changes in vehicle floorplan payable-trade are reported as operating cash flows and changes in vehicle floorplan payable-non-trade are reported as financing cash flows in the accompanying Unaudited Condensed Consolidated Statements of Cash Flows.

Our inventory costs are generally reduced by manufacturer holdbacks, incentives, floorplan assistance, and non-reimbursement-based manufacturer advertising rebates, while the related vehicle floorplan payables are reflective of the gross

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cost of the vehicle. The vehicle floorplan payables, as shown in the above table, may also be higher than the inventory cost due to the timing of the sale of a vehicle and payment of the related liability.

At September 30, 2023, our new vehicle floorplan facilities utilized Prime-based and SOFR-based interest rates. Our new vehicle floorplan outstanding had a weighted-average interest rate of 7.0% at September 30, 2023, and 5.9% at December 31, 2022. As of September 30, 2023, the aggregate capacity under our new vehicle floorplan facilities to finance our new vehicle inventory was approximately $4.6 billion, of which $2.2 billion had been borrowed.

At September 30, 2023, our used vehicle floorplan facilities utilized Prime-based and SOFR-based interest rates. Our used vehicle floorplan outstanding had a weighted-average interest rate of 7.0% at September 30, 2023, and 5.9% at December 31, 2022. As of September 30, 2023, the aggregate capacity under our used vehicle floorplan facilities with various lenders to finance a portion of our used vehicle inventory was $775.6 million, of which $591.3 million had been borrowed. The remaining borrowing capacity of $184.3 million was limited to $0.3 million based on the eligible used vehicle inventory that could have been pledged as collateral.

7.GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill and intangible assets, net, consist of the following:


	September 30, 2023		December 31, 2022
Goodwill (1)	$	1,455.7	$	1,320.1

Franchise rights - indefinite-lived	$	876.2	$	816.2
Other intangibles	70.7		30.7
	946.9		846.9
Less: accumulated amortization	(15.1)		(9.9)
Other intangible assets, net	$	931.8	$	837.0

(1) The change in goodwill from the prior period is primarily due to the acquisition of the mobile repair and maintenance business we acquired in January 2023. Such goodwill is reflected in our Mobile Service reporting unit.

Goodwill and our franchise rights assets are tested for impairment annually as of April 30 or more frequently when events or changes in circumstances indicate that impairment may exist.

Under accounting standards, we chose to make a qualitative evaluation about the likelihood of goodwill impairment for our annual impairment testing as of April 30, 2023, and we determined that it was not more likely than not that the fair values of our reporting units were less than their carrying amounts. We elected to perform quantitative franchise rights impairment tests as of April 30, 2023, and no impairment charges resulted from these quantitative tests.

See Note 13 of the Notes to Unaudited Condensed Consolidated Financial Statements for information about our annual impairment tests of goodwill and franchise rights.

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8.DEBT

Non-Vehicle Long-Term Debt

Non-vehicle long-term debt consisted of the following:


Debt Description	Maturity Date	Interest Payable	September 30, 2023		December 31, 2022
3.5% Senior Notes	November 15, 2024	May 15 and November 15	$	450.0	$	450.0
4.5% Senior Notes	October 1, 2025	April 1 and October 1	450.0		450.0
3.8% Senior Notes	November 15, 2027	May 15 and November 15	300.0		300.0
1.95% Senior Notes	August 1, 2028	February 1 and August 1	400.0		400.0
4.75% Senior Notes	June 1, 2030	June 1 and December 1	500.0		500.0
2.4% Senior Notes	August 1, 2031	February 1 and August 1	450.0		450.0
3.85% Senior Notes	March 1, 2032	March 1 and September 1	700.0		700.0
Revolving credit facility	July 18, 2028	Monthly	—		—
Finance leases and other debt	Various dates through 2041		365.3		375.5
			3,615.3		3,625.5
Less: unamortized debt discounts and debt issuance costs			(22.9)		(26.0)
Less: current maturities			(12.8)		(12.6)
Long-term debt, net of current maturities			$	3,579.6	$	3,586.9

Debt Refinancing Transaction

On July 18, 2023, we amended and restated our unsecured credit agreement to, among other things, (1) increase the revolving credit facility (the “facility”) commitment from $1.8 billion to $1.9 billion, (2) extend the maturity date of the facility to July 18, 2028, (3) allow for the maximum leverage ratio covenant to increase from 3.75x to 4.25x for four fiscal quarters in the event that we complete a material acquisition, and (4) replace the maximum capitalization ratio covenant with a minimum interest coverage ratio covenant.

Senior Unsecured Notes and Credit Agreement

The interest rates payable on our 3.5% Senior Notes, 4.5% Senior Notes, 3.8% Senior Notes, and 4.75% Senior Notes are subject to adjustment upon the occurrence of certain credit rating events as provided in the indentures for these senior unsecured notes.

Under our amended and restated credit agreement, we have a $1.9 billion revolving credit facility that matures on July 18, 2028. The credit agreement also contains an accordion feature that allows us, subject to credit availability and certain other conditions, to increase the amount of the revolving credit facility, together with any added term loans, by up to $500.0 million in the aggregate. As of September 30, 2023, we had no borrowings outstanding under our revolving credit facility. We have a $200.0 million letter of credit sublimit as part of the revolving credit facility. The amount available to be borrowed under the revolving credit facility is reduced on a dollar-for-dollar basis by the cumulative amount of any outstanding letters of credit, which was $0.8 million at September 30, 2023, leaving a borrowing capacity under our credit agreement of $1.9 billion at September 30, 2023.

Our revolving credit facility under our amended and restated credit agreement provides for a commitment fee on undrawn amounts ranging from 0.125% to 0.20% and interest on borrowings at SOFR plus a credit spread adjustment of 0.10% or the base rate, in each case plus an applicable margin. The applicable margin ranges from 1.125% to 1.50% for SOFR borrowings and 0.125% to 0.50% for base rate borrowings. The interest rate charged for our revolving credit facility is affected by our leverage ratio.

Within the meaning of Regulation S-X, Rule 3-10, AutoNation, Inc. (the parent company) has no independent assets or operations. If guarantees of our subsidiaries were to be issued under our existing registration statement, we expect that such

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guarantees would be full and unconditional and joint and several, and any subsidiaries other than the guarantor subsidiaries would be minor.

Other Long-Term Debt

At September 30, 2023, we had finance leases and other debt obligations of $365.3 million, which are due at various dates through 2041.

Commercial Paper

We have a commercial paper program pursuant to which we may issue short-term, unsecured commercial paper notes on a private placement basis. On August 16, 2023, we increased the maximum aggregate principal amount that may be outstanding at any time under the commercial paper program from $1.0 billion to $1.9 billion. The interest rate for the commercial paper notes varies based on duration and market conditions. The maturities of the commercial paper notes may vary, but may not exceed 397 days from the date of issuance. Proceeds from the issuance of commercial paper notes are used to repay borrowings under the revolving credit facility, to finance acquisitions, and for strategic initiatives, working capital, capital expenditures, share repurchases, and/or other general corporate purposes. We plan to use the revolving credit facility under our credit agreement as a liquidity backstop for borrowings under the commercial paper program. A downgrade in our credit ratings could negatively impact our ability to issue, or the interest rates for, commercial paper notes.

At September 30, 2023, we had $350.0 million of commercial paper notes outstanding with a weighted-average annual interest rate of 6.05% and a weighted-average remaining term of 16 days. At December 31, 2022, we had $50.0 million of commercial paper notes outstanding with a weighted-average annual interest rate of 4.30% and a weighted-average remaining term of 1 day.

Non-Recourse Debt

Non-recourse debt relates to auto loans receivable of our captive auto finance company funded through non-recourse funding facilities, including warehouse facilities and asset-backed term funding transactions.

We have two warehouse facility agreements with certain banking institutions through wholly-owned, bankruptcy-remote, special purpose entities, primarily to finance the purchase and origination of auto loans receivable. We fund auto loans receivable through these warehouse facilities, which are secured by the eligible auto loans receivable pledged as collateral.

Additionally, we have term securitizations that were put in place to provide long-term funding for certain auto loans receivable initially funded through the warehouse facilities. In these transactions, a pool of auto loans receivable is sold to a bankruptcy-remote, special purpose entity that, in turn, transfers the receivables to a special purpose securitization trust (“term securitization trust”). The term securitization trust issues asset-backed securities, secured or otherwise supported by the transferred receivables, and the proceeds from the sale of the asset-backed securities are used to finance the securitized receivables.

We are required to evaluate the term securitization trusts for consolidation. We retain the servicing rights for the auto loans receivable that were funded through the term securitizations. In our capacity as servicer of the underlying auto loans receivable, we have the power to direct the activities of the trusts that most significantly impact the economic performance of the trusts. In addition, we have the obligation to absorb losses (subject to limitations) and the rights to receive any returns of the trusts, which could be significant. Accordingly, we are the primary beneficiary of the trusts and are required to consolidate them.

We recognize transfers of auto loans receivable into the warehouse facilities and term securitizations (together, “non-recourse debt”) as secured borrowings, which result in recording the auto loans receivable and the related non-recourse debt on our Unaudited Condensed Consolidated Balance Sheets. The non-recourse debt is structured to legally isolate the auto loans receivable, which can only be used as collateral to settle obligations of the related non-recourse debt. The term securitization trusts and investors and the creditors of the warehouse facilities have no recourse to our assets for payment of the debt beyond the related receivables, the amounts on deposit in reserve accounts, and the restricted cash from collections on auto loans receivable.

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(Continued)

Non-recourse debt outstanding at September 30, 2023, and December 31, 2022, consisted of the following:


	September 30, 2023		December 31, 2022
Warehouse facilities	$	189.0	$	181.8
Term securitization debt of consolidated VIEs	59.2		146.9
	248.2		328.7
Less: unamortized debt discounts and debt issuance costs	(2.1)		(5.1)
Less: current maturities	(7.2)		(10.7)
Non-recourse debt, net of current maturities	$	238.9	$	312.9

The timing of principal payments on the non-recourse debt is based on the timing of principal collections and defaults on the related auto loans receivable. The current portion of non-recourse debt represents the portion of the payments received from the auto loans receivable that are due to be distributed as principal payments on the non-recourse debt in the following period.

We generally enter into warehouse facility agreements for one-year terms and typically renew the agreements annually. One of the warehouse facilities matures on October 1, 2024, and the other matures on December 17, 2023. Aggregate commitments under the warehouse facilities total $350.0 million.

The term securitization debt of consolidated VIEs consists of various notes with interest rates ranging from 1.49% to 4.45% and maturity dates ranging from August 2026 to May 2028. Term securitization debt is expected to become due and be paid prior to the final legal maturities based on amortization of the auto loans receivable pledged as collateral. The term securitization agreements require certain funds to be held in restricted cash accounts to provide additional collateral for the borrowings or to be applied to make payments on the securitization debt. Restricted cash of consolidated VIEs under the various term securitization agreements totaled $4.6 million as of September 30, 2023, and $14.9 million as of December 31, 2022, and is included in Other Current Assets and Other Assets in our Unaudited Condensed Consolidated Balance Sheets. Auto loans receivable pledged to the term securitization debt of consolidated VIEs totaled $59.8 million as of September 30, 2023, and $151.4 million as of December 31, 2022.

9.INCOME TAXES

Income taxes receivable included in Receivables, net totaled $24.8 million at September 30, 2023 and $20.2 million at December 31, 2022.

We file income tax returns in the U.S. federal jurisdiction and various states. As a matter of course, various taxing authorities, including the IRS, regularly audit us. These audits may culminate in proposed assessments which may ultimately result in our owing additional taxes. With few exceptions, we are no longer subject to U.S. federal, state, and local income tax examinations by tax authorities for years before 2018. Currently, no tax years are under examination by the IRS, and tax years from 2019 to 2021 are under examination by U.S. state jurisdictions. We believe that our tax positions comply with applicable tax law and that we have adequately provided for these matters.

It is our policy to account for interest and penalties associated with income tax obligations as a component of Income Tax Provision in the accompanying Unaudited Condensed Consolidated Statements of Income.

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AUTONATION, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

10.SHAREHOLDERS’ EQUITY

A summary of shares repurchased under our stock repurchase program authorized by our Board of Directors follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Shares repurchased	1.3		3.8		5.3		10.9
Aggregate purchase price (1)	$	200.0	$	428.2	$	712.4	$	1,213.1
Average purchase price per share	$	155.91	$	113.51	$	135.38	$	110.96

(1) Excludes excise tax accrual imposed under the Inflation Reduction Act of $2.0 million and $6.6 million for the three and nine months ended September 30, 2023, respectively.

As of September 30, 2023, $472.0 million remained available under our stock repurchase limit most recently authorized by our Board of Directors.

We have 5.0 million authorized shares of preferred stock, par value $0.01 per share, none of which are issued or outstanding. The Board of Directors has the authority to issue the preferred stock in one or more series and to establish the rights, preferences, and dividends of such preferred stock.

A summary of shares of common stock issued in connection with the exercise of stock options follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Shares issued (in actual number of shares)	7,000		16,570		37,996		71,030
Proceeds from the exercise of stock options	$	0.4	$	0.8	$	1.9	$	3.4
Average exercise price per share	$	57.15	$	48.15	$	50.34	$	47.94

The following table presents a summary of shares of common stock issued in connection with the settlement of RSUs, as well as shares surrendered to AutoNation to satisfy tax withholding obligations in connection with the settlement of RSUs:


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(In actual number of shares)	2023	2022	2023	2022
Shares issued	987	1,227	531,994	775,312
Shares surrendered to AutoNation to satisfy tax withholding obligations	278	570	182,527	263,521

11. ACQUISITIONS AND DIVESTITURES

During the nine months ended September 30, 2023, we acquired RepairSmith, a mobile solution for automotive repair and maintenance, and we also purchased seven stores. Acquisitions are included in the Unaudited Condensed Consolidated Financial Statements from the date of acquisition. The purchase price allocations for these business combinations are preliminary and subject to final adjustments, primarily related to the valuation of working capital, deferred tax assets and liabilities, and residual goodwill. We did not purchase any stores during the nine months ended September 30, 2022.

The acquisitions that occurred during the nine months ended September 30, 2023, were not material to our financial condition or results of operations. Additionally, on a pro forma basis as if the results of these acquisitions had been included in our consolidated results for the entire nine month periods ended September 30, 2023 and 2022, revenue and net income would not have been materially different from our reported revenue and net income for these periods.

We did not divest any stores during the nine months ended September 30, 2023. We divested three stores during the nine months ended September 30, 2022. We recognized net gains related to divestitures of $16.1 million during the nine months

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

ended September 30, 2022, which are included in Other Income, Net (within Operating Income) in our Consolidated Statement of Operations. The financial condition and results of operations of these businesses were not material to our consolidated financial statements.

12.CASH FLOW INFORMATION

Cash, Cash Equivalents, and Restricted Cash

The total amounts presented on our statements of cash flows include cash, cash equivalents, and restricted cash. Restricted cash includes additional collateral for non-recourse debt borrowings and collections on auto loans receivable that are due to be distributed to non-recourse debt holders in the following period. The following table provides a reconciliation of cash and cash equivalents reported on our Unaudited Condensed Consolidated Balance Sheets to the total amounts reported on our Unaudited Condensed Consolidated Statements of Cash Flows:


	September 30, 2023		December 31, 2022
Cash and cash equivalents	$	64.0	$	72.6
Restricted cash included in Other Current Assets	12.6		15.6
Restricted cash included in Other Assets	1.8		7.2
Total cash, cash equivalents, and restricted cash	$	78.4	$	95.4

Non-Cash Investing and Financing Activities

We had accrued purchases of property and equipment of $33.5 million at September 30, 2023, and $29.7 million at September 30, 2022.


	Nine Months Ended
	September 30,
	2023		2022
Supplemental noncash information on adjustments to right-of-use assets, including right-of-use assets obtained in exchange for new:
Operating lease liabilities	$	78.6	$	53.2
Finance lease liabilities	$	40.3	$	20.2

Interest and Income Taxes Paid

We made interest payments, net of amounts capitalized and including interest on vehicle inventory financing, of $218.2 million during the nine months ended September 30, 2023, and $96.7 million during the nine months ended September 30, 2022. We made income tax payments, net of income tax refunds, of $267.2 million during the nine months ended September 30, 2023, and $368.0 million during the nine months ended September 30, 2022.

13.FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The fair value of a financial instrument represents the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of judgment, and therefore cannot be determined with precision.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

Accounting standards define fair value as the price that would be received from selling an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Accounting standards establish a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value and also establishes the following three levels of inputs that may be used to measure fair value:


Level 1			Quoted prices (unadjusted) in active markets for identical assets or liabilities that a reporting entity can access at the measurement date

Level 2			Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly

Level 3			Unobservable inputs

The following methods and assumptions were used by us in estimating fair value disclosures for financial instruments:

•Cash and cash equivalents, receivables, other current assets, vehicle floorplan payable, accounts payable, other current liabilities, commercial paper, warehouse credit facilities, and variable rate debt: The amounts reported in the accompanying Unaudited Condensed Consolidated Balance Sheets approximate fair value due to their short-term nature or the existence of variable interest rates that approximate prevailing market rates.

•Auto loans receivable, net: Auto loans receivable are presented net of an allowance for expected credit losses, which we believe approximates fair value.

•Investments in Equity Securities: Our equity investments with readily determinable fair values are measured at fair value using Level 1 inputs. The fair value of our equity investments with readily determinable fair values totaled $13.3 million at September 30, 2023, and $15.4 million at December 31, 2022.

Our equity investment that does not have a readily determinable fair value is measured using the measurement alternative as permitted by accounting standards and was recorded at cost, to be subsequently adjusted for observable price changes. The carrying amount of our equity investment without a readily determinable fair value was $56.7 million at September 30, 2023, and $56.7 million at December 31, 2022. This equity investment reflects a cumulative upward adjustment of $3.4 million based on an observable price change. We did not record any upward adjustments during the nine months ended September 30, 2023. Additionally, we have not recorded any impairments or downward adjustments to the carrying amount of this equity investment as of and for the nine months ended September 30, 2023.

Investments in equity securities are reported in Other Current Assets and Other Assets in the accompanying Unaudited Condensed Consolidated Balance Sheets. Realized and unrealized gains and losses are reported in Other Income (Loss), Net (non-operating) in the Unaudited Condensed Consolidated Statements of Income and in the “Corporate and other” category of our segment information.


	Nine Months Ended
	September 30,
	2023		2022
Net losses recognized during the period on equity securities	$	(2.3)	$	(0.1)
Less: Net losses recognized during the period on equity securities sold during the period	—		—
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date	$	(2.3)	$	(0.1)

•Fixed rate long-term debt: Our fixed rate long-term debt consists primarily of amounts outstanding under our senior unsecured notes. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 1). A summary of the aggregate carrying values and fair values of our senior unsecured notes is as follows:


	September 30, 2023		December 31, 2022
Carrying value	$	3,227.1	$	3,224.0
Fair value	$	2,817.8	$	2,803.6

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

Nonfinancial assets such as goodwill, other intangible assets, and long-lived assets held and used, are measured at fair value when there is an indicator of impairment and recorded at fair value only when impairment is recognized or for a business combination. The fair values less costs to sell of long-lived assets or disposal groups held for sale are assessed each reporting period they remain classified as held for sale. Subsequent changes in the held for sale long-lived asset’s or disposal group's fair value less cost to sell (increase or decrease) are reported as an adjustment to its carrying amount, except that the adjusted carrying amount cannot exceed the carrying amount of the long-lived asset or disposal group at the time it was initially classified as held for sale.

The following table presents assets measured and recorded at fair value on a nonrecurring basis during the nine months ended September 30, 2023 and 2022:


	2023				2022
Description	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)		Gain/(Loss)		Fair Value Measurements Using Significant Unobservable Inputs (Level 3)		Gain/(Loss)



Long-lived assets held and used	$	—	$	(2.7)	$	—	$	(1.0)

Goodwill and Other Intangible Assets

Goodwill for our reporting units and our indefinite-lived intangible assets are tested for impairment annually as of April 30 or more frequently when events or changes in circumstances indicate that impairment may exist. Our principal identifiable intangible assets are individual store rights under franchise agreements with vehicle manufacturers, which have indefinite lives.

Under accounting standards, we chose to make a qualitative evaluation about the likelihood of goodwill impairment for our annual impairment testing as of April 30, 2023 and 2022, and we determined that it was not more likely than not that the fair values of our reporting units were less than their carrying amounts. We elected to perform quantitative franchise rights impairment tests as of April 30, 2023 and 2022, and no impairment charges resulted from these quantitative tests.

The quantitative impairment test for franchise rights requires the comparison of the franchise rights’ estimated fair value to carrying value by store. Fair values of rights under franchise agreements are estimated using Level 3 inputs by discounting expected future cash flows of the store. The forecasted cash flows contain inherent uncertainties, including significant estimates and assumptions related to growth rates, margins, working capital requirements, capital expenditures, and cost of capital, for which we utilize certain market participant-based assumptions, using third-party industry projections, economic projections, and other marketplace data we believe to be reasonable.

Long-Lived Assets and Right-of-Use Assets

Fair value measurements for our long-lived assets and right-of-use assets are based on Level 3 inputs. Changes in fair value measurements are reviewed and assessed each quarter for properties classified as held for sale, or when an indicator of impairment exists for properties classified as held and used or for right-of-use assets. The valuation process is generally based on a combination of the market and replacement cost approaches. In certain cases, fair value measurements are based on pending agreements to sell the related assets.

In a market approach, we use transaction prices for comparable properties that have recently been sold. These transaction prices are adjusted for factors related to a specific property. We evaluate changes in local real estate markets, and/or recent market interest or negotiations related to a specific property. In a replacement cost approach, the cost to replace a specific long-lived asset is considered, which is adjusted for depreciation from physical deterioration, as well as functional and economic obsolescence, if present and measurable.

To validate the fair values determined under the valuation process noted above, we also obtain independent third-party appraisals for our properties and/or third-party brokers’ opinions of value, which are generally developed using the same valuation approaches described above, and we evaluate any recent negotiations or discussions with third-party real estate brokers related to a specific long-lived asset or market.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

The non-cash impairment charges related to long-lived assets held and used are included in Other (Income) Expense, Net in our Unaudited Condensed Consolidated Statements of Income and in the “Corporate and other” category of our segment information.

We had assets held for sale in continuing operations of $41.6 million as of September 30, 2023, and $5.7 million as of December 31, 2022, primarily related to inventory, goodwill, and property of disposal groups held for sale, as well as property held for sale. We had no assets held for sale in discontinued operations as of September 30, 2023, and $1.1 million as of December 31, 2022, which was related to property held for sale. Assets held for sale are included in Other Current Assets in our Unaudited Condensed Consolidated Balance Sheets.

14.COMMITMENTS AND CONTINGENCIES

Legal Proceedings

We are involved, and will continue to be involved, in numerous legal proceedings arising out of the conduct of our business, including litigation with customers, third-party dealers, wage and hour and other employment-related lawsuits, and actions brought by governmental authorities. Some of these lawsuits purport or may be determined to be class or collective actions and seek substantial damages or injunctive relief, or both, and some may remain unresolved for several years. We establish accruals for specific legal proceedings when it is considered probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Our accruals for loss contingencies are reviewed quarterly and adjusted as additional information becomes available. We disclose the amount accrued if material or if such disclosure is necessary for our financial statements to not be misleading. If a loss is not both probable and reasonably estimable, or if an exposure to loss exists in excess of the amount accrued, we assess whether there is at least a reasonable possibility that a loss, or additional loss, may have been incurred. If there is a reasonable possibility that a loss, or additional loss, may have been incurred, we disclose the estimate of the possible loss or range of loss if it is material or a statement that such an estimate cannot be made. Our evaluation of whether a loss is reasonably possible or probable is based on our assessment and consultation with legal counsel regarding the ultimate outcome of the matter.

As of September 30, 2023 and 2022, we have accrued for the potential impact of loss contingencies that are probable and reasonably estimable, and there was no indication of a reasonable possibility that a material loss, or additional material loss, may have been incurred. We do not believe that the ultimate resolution of these matters will have a material adverse effect on our results of operations, financial condition, or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on our results of operations, financial condition, or cash flows.

Other Matters

AutoNation, acting through its subsidiaries, is the lessee under many real estate leases that provide for the use by our subsidiaries of their respective store premises. Pursuant to these leases, we agree to indemnify the lessor and other related parties from certain liabilities arising as a result of the use of the leased premises, including environmental liabilities, or a breach of the lease by the lessee. Additionally, from time to time, we enter into agreements with third parties in connection with the sale of assets or businesses in which we agree to indemnify the purchaser or related parties from certain liabilities or costs arising in connection with the assets or business. Also, in the ordinary course of business in connection with purchases or sales of goods and services, we enter into agreements that may contain indemnification provisions. In the event that an indemnification claim is asserted, our liability would be limited by the terms of the applicable agreement.

From time to time, primarily in connection with dispositions of automotive stores, we assign or sublet to the store purchaser our interests in any real property leases associated with such stores. In general, we retain responsibility for the performance of certain obligations under such leases to the extent that the assignee or sublessee does not perform, whether such performance is required prior to or following the assignment or subletting of the lease. Additionally, we generally remain subject to the terms of any guarantees made by us in connection with such leases. We generally have indemnification rights against the assignee or sublessee in the event of non-performance under these leases, as well as certain defenses. We presently have no reason to believe that we will be called on to perform under any such remaining assigned leases or subleases. We estimate that lessee rental payment obligations during the remaining terms of these leases with expirations ranging from 2024 to 2034 are approximately $5 million at September 30, 2023. There can be no assurance that any performance required of us under these leases would not have a material adverse effect on our business, financial condition, and cash flows.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

At September 30, 2023, surety bonds, letters of credit, and cash deposits totaled $111.5 million, of which $0.8 million were letters of credit. In the ordinary course of business, we are required to post performance and surety bonds, letters of credit, and/or cash deposits as financial guarantees of our performance. We do not currently provide cash collateral for outstanding letters of credit.

In the ordinary course of business, we are subject to numerous laws and regulations, including automotive, environmental, health and safety, and other laws and regulations. We do not anticipate that the costs of compliance with such laws will have a material adverse effect on our business, results of operations, cash flows, or financial condition, although such outcome is possible given the nature of our operations and the extensive legal and regulatory framework applicable to our business. We do not have any material known environmental commitments or contingencies.

15.BUSINESS AND CREDIT CONCENTRATIONS

We own and operate franchised automotive stores in the United States pursuant to franchise agreements with vehicle manufacturers. During the nine months ended September 30, 2023, approximately 63% of our total retail new vehicle unit sales was generated by our stores in Florida, Texas, and California. We are subject to a concentration of risk in the event of financial distress of or other adverse event related to a major vehicle manufacturer or related lender or supplier. The core brands of vehicles that we sell, representing approximately 88% of the new vehicles that we sold during the nine months ended September 30, 2023, are manufactured by Toyota (including Lexus), Honda, Ford, General Motors, BMW, Mercedes-Benz, Stellantis, and Volkswagen (including Audi and Porsche). Our business could be materially adversely impacted by a bankruptcy of or other adverse event related to a major vehicle manufacturer or related lender or supplier.

We had receivables from manufacturers or distributors of $212.3 million at September 30, 2023, and $174.4 million at December 31, 2022. Additionally, a large portion of our contracts-in-transit included in Receivables, net, in the accompanying Unaudited Condensed Consolidated Balance Sheets, are due from automotive manufacturers’ captive finance subsidiaries, which provide financing directly to our new and used vehicle customers. Concentrations of credit risk with respect to non-manufacturer trade receivables are limited due to the wide variety of customers and markets in which our products are sold as well as their dispersion across many different geographic areas in the United States. Consequently, at September 30, 2023, we do not consider AutoNation to have any significant non-manufacturer concentrations of credit risk.

16.SEGMENT INFORMATION

At September 30, 2023 and 2022, we had three reportable segments: (1) Domestic, (2) Import, and (3) Premium Luxury. Our Domestic segment is comprised of retail automotive franchises that sell new vehicles manufactured by Ford, General Motors, and Stellantis. Our Import segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Toyota, Honda, Hyundai, Subaru, and Nissan. Our Premium Luxury segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Mercedes-Benz, BMW, Lexus, Audi, and Jaguar Land Rover. The franchises in each segment also sell used vehicles, parts and automotive repair and maintenance services, and automotive finance and insurance products.

The reportable segments identified above are the business activities of the Company for which discrete financial information is available and for which operating results are regularly reviewed by our chief operating decision maker to allocate resources and assess performance. Our chief operating decision maker is our Chief Executive Officer.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Continued)

The following table provides information on revenues from external customers and segment income of our reportable segments:


	Three Months Ended						Nine Months Ended
	September 30, 2023						September 30, 2023
	Domestic		Import		Premium Luxury		Domestic		Import		Premium Luxury
Revenues from external customers	$	1,983.9	$	2,077.2	$	2,516.1	$	5,770.5	$	5,864.2	$	7,621.5
Segment income (1)	$	107.2	$	164.7	$	192.9	$	341.5	$	498.1	$	641.2

	Three Months Ended						Nine Months Ended
	September 30, 2022						September 30, 2022
	Domestic		Import		Premium Luxury		Domestic		Import		Premium Luxury
Revenues from external customers	$	2,032.8	$	1,875.2	$	2,506.4	$	6,108.1	$	5,799.0	$	7,601.7
Segment income (1)	$	142.7	$	180.3	$	235.2	$	445.2	$	559.0	$	722.2

(1) Segment income represents income for each of our reportable segments and is defined as operating income less floorplan interest expense.

The following is a reconciliation of total segment income for reportable segments to our consolidated income from continuing operations before income taxes:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Total segment income for reportable segments	$	464.8	$	558.2	$	1,480.8	$	1,726.4
Corporate and other	(83.6)		(46.4)		(277.0)		(148.5)
Other interest expense	(48.8)		(33.7)		(135.9)		(97.4)
Other income (loss), net	(5.0)		(4.6)		4.6		(24.7)
Income from continuing operations before income taxes	$	327.4	$	473.5	$	1,072.5	$	1,455.8

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the Unaudited Condensed Consolidated Financial Statements and notes thereto included under Part I, Item 1 of this Quarterly Report on Form 10-Q. In addition, reference should be made to our audited Consolidated Financial Statements and notes thereto and related “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our most recent Annual Report on Form 10-K.

Overview

AutoNation, Inc., through its subsidiaries, is one of the largest automotive retailers in the United States. As of September 30, 2023, we owned and operated 354 new vehicle franchises from 253 stores located in the United States, predominantly in major metropolitan markets in the Sunbelt region. Our stores, which we believe include some of the most recognizable and well known in our key markets, sell 34 different new vehicle brands. The core brands of new vehicles that we sell, representing approximately 88% of the new vehicles that we sold during the nine months ended September 30, 2023, are manufactured by Toyota (including Lexus), Honda, Ford, General Motors, BMW, Mercedes-Benz, Stellantis, and Volkswagen (including Audi and Porsche). As of September 30, 2023, we also owned and operated 53 AutoNation-branded collision centers, 17 AutoNation USA used vehicle stores, 4 AutoNation-branded automotive auction operations, 3 parts distribution centers, a mobile automotive repair and maintenance business, and an auto finance company.

We offer a diversified range of automotive products and services, including new vehicles, used vehicles, “parts and service” (also referred to as “After-Sales”), which includes automotive repair and maintenance services as well as wholesale parts and collision businesses, and automotive “finance and insurance” products (also referred to as “Customer Financial Services”), which include vehicle service and other protection products, as well as the arranging of financing for vehicle purchases through third-party finance sources. We also offer indirect financing on certain vehicles we sell through our captive finance company. We believe that the significant scale of our operations and the quality of our managerial talent allow us to achieve efficiencies in our key markets by, among other things, leveraging the AutoNation retail brand and advertising, implementing standardized processes, and increasing productivity across all of our stores.

At September 30, 2023, we had three reportable segments: (1) Domestic, (2) Import, and (3) Premium Luxury. Our Domestic segment is comprised of retail automotive franchises that sell new vehicles manufactured by Ford, General Motors, and Stellantis. Our Import segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Toyota, Honda, Hyundai, Subaru, and Nissan. Our Premium Luxury segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Mercedes-Benz, BMW, Lexus, Audi, and Jaguar Land Rover. The franchises in each segment also sell used vehicles, parts and automotive repair and maintenance services, and automotive finance and insurance products.

For the nine months ended September 30, 2023, new vehicle sales accounted for 47% of our total revenue and 21% of our total gross profit. Used vehicle sales accounted for 31% of our total revenue and 11% of our total gross profit. Our parts and service operations, while comprising 17% of our total revenue, contributed 41% of our total gross profit. Our finance and insurance sales, while comprising 5% of our total revenue, contributed 27% of our total gross profit.

Market Conditions

In the third quarter of 2023, U.S. industry retail new vehicle unit sales increased approximately 12% as compared to the third quarter of 2022. Although new vehicle inventory levels for certain manufacturers and models increased during the third quarter of 2023, there continues to be a shortage of available new vehicles for sale as compared to historical inventory levels for certain manufacturers and models, driven largely by disruptions in the manufacturers’ supply chains. The decline in new vehicle unit volume in recent years has adversely impacted the availability of nearly new vehicle inventory, which has had an adverse impact on our used vehicle sales volume. Additionally, worsening economic conditions, including rising interest rates, could adversely impact consumer demand for vehicles.

On September 15, 2023, the United Auto Workers launched strikes against Ford, General Motors (“GM”), and Stellantis (the parent company of Chrysler). We have 34 Ford stores, 32 GM stores, and 24 Chrysler stores in our portfolio. There were no material impacts to our results during the third quarter of 2023. However, if the strikes continue for a prolonged period of time, it could adversely impact parts inventory supply and the availability of certain vehicle models.

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Results of Operations

During the three months ended September 30, 2023, we had net income of $243.7 million and diluted earnings per share of $5.54, as compared to net income of $352.6 million and diluted earnings per share of $6.31 during the same period in 2022.

Our total gross profit decreased 1.4% during the third quarter of 2023 compared to the third quarter of 2022, driven by decreases in new vehicle gross profit of 24.0% and used vehicle gross profit of 10.0%, each as compared to the third quarter of 2022. New vehicle gross profit was adversely impacted by a decrease in gross profit per vehicle retailed (“PVR”) resulting from increasing supply and availability of new vehicle inventory, which has resulted in moderation of pricing and margins. Used vehicle gross profit was adversely impacted primarily by a decrease in used vehicle unit volume due in part to lower availability and levels of nearly new vehicle inventory as a result of the decline in new vehicle unit volume in recent years. The decreases in gross profit were partially offset by an increase in parts and service gross profit of 14.0%, as compared to the third quarter of 2022. Parts and service results benefited primarily from increases in gross profit from customer-pay service, the preparation of vehicles for sale, and warranty service.

SG&A expenses increased largely due to acquisitions and newly opened stores and expenditures associated with investments in technology and strategic initiatives. Floorplan interest expense increased due to higher average interest rates and higher average floorplan balances. Other interest expense increased due to higher average interest rates and higher average debt balances.

Net income during the three months ended September 30, 2022, benefited from after-tax gains related to store/property divestitures of $12.1 million and a legal settlement of $4.9 million.

Inventory Management

Our new and used vehicle inventories are stated at the lower of cost or net realizable value in our consolidated balance sheets. We monitor our vehicle inventory levels based on current economic conditions and seasonal sales trends. Our new vehicle inventory units at September 30, 2023 and 2022, were 27,544 and 13,303, respectively. While our new vehicle inventory units have increased compared to the prior year, by historical standards, our inventory unit levels are significantly lower driven largely by disruptions in the manufacturers’ supply chains. Inadequate levels of new vehicle availability could adversely affect our financial results.

We have typically not experienced significant losses on the sale of new vehicle inventory, in part due to incentives provided by manufacturers to promote sales of new vehicles and our inventory management practices. We monitor our new vehicle inventory values as compared to net realizable values. Our new vehicle inventory balance was net of cumulative write-downs of $0.9 million at September 30, 2023. We had no new vehicle inventory write-downs at December 31, 2022.

We recondition the majority of used vehicles acquired for retail sale in our parts and service departments and capitalize the related costs to the used vehicle inventory. We monitor our used vehicle inventory values as compared to net realizable values. Typically, used vehicles that are not sold on a retail basis are sold at wholesale auctions. Our used vehicle inventory balance was net of cumulative write-downs of $7.0 million at September 30, 2023, and $7.4 million at December 31, 2022.

Parts, accessories, and other inventory are carried at the lower of cost or net realizable value. We estimate the amount of potentially damaged and/or excess and obsolete inventory based upon historical experience, manufacturer return policies, and industry trends. Our parts, accessories, and other inventory balance was net of cumulative write-downs of $7.3 million at September 30, 2023, and $7.4 million at December 31, 2022.

Critical Accounting Estimates

We prepare our Unaudited Condensed Consolidated Financial Statements in conformity with U.S. generally accepted accounting principles (“GAAP”), which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. We evaluate our estimates on an ongoing basis, and we base our estimates on historical experience and various other assumptions we believe to be reasonable. Actual outcomes could differ materially from those estimates in a manner that could have a material effect on our Unaudited Condensed Consolidated Financial Statements. For additional discussion of our critical accounting estimates, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our most recent Annual Report on Form 10-K.

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Goodwill

Goodwill for our reporting units is tested for impairment annually as of April 30 or more frequently when events or changes in circumstances indicate that the carrying value of a reporting unit more likely than not exceeds its fair value. We may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit is impaired. When assessing goodwill for impairment, our decision to perform a qualitative assessment for an individual reporting unit is influenced by a number of factors, including the carrying value of the reporting unit’s goodwill, the significance of the excess of the reporting unit’s estimated fair value over carrying value at the last quantitative assessment date, the amount of time in between quantitative fair value assessments, macroeconomic conditions, automotive industry and market conditions, and our operating performance.

As of September 30, 2023, we have $234.6 million of goodwill related to the Domestic reporting unit, $526.6 million related to the Import reporting unit, $482.1 million related to the Premium Luxury reporting unit, $129.4 million related to the Mobile Service reporting unit, $78.4 million related to the AutoNation Finance reporting unit, and $4.6 million related to the Collision Centers reporting unit.

Other Intangible Assets

Our principal identifiable intangible assets are individual store rights under franchise agreements with vehicle manufacturers, which have indefinite lives and are tested for impairment annually as of April 30 or more frequently when events or changes in circumstances indicate that impairment may have occurred. We may first perform a qualitative assessment to determine whether it is more likely than not that a franchise right asset is impaired. The quantitative impairment test for franchise rights requires the comparison of the franchise rights’ estimated fair value to carrying value by store. Fair values of rights under franchise agreements are estimated using unobservable (Level 3) inputs by discounting expected future cash flows of the store. The forecasted cash flows contain inherent uncertainties, including significant estimates and assumptions related to growth rates, margins, working capital requirements, capital expenditures, and cost of capital, for which we utilize certain market participant-based assumptions, using third-party industry projections, economic projections, and other marketplace data we believe to be reasonable.

We elected to perform quantitative tests for our annual franchise rights impairment testing as of April 30, 2023, and no impairment charges resulted from these quantitative tests.

If the fair value of each of our franchise rights had been determined to be a hypothetical 10% lower as of the valuation date of April 30, 2023, the resulting impairment charge would have been less than $0.5 million. The effect of a hypothetical 10% decrease in fair value estimates is not intended to provide a sensitivity analysis of every potential outcome.

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Reported Operating Data

Historical operating results include the results of acquired businesses from the date of acquisition.


($ in millions, except per vehicle data)	Three Months Ended September 30,							Nine Months Ended September 30,
	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Revenue:
New vehicle	$	3,187.6	$	2,863.9	$	323.7	11.3	$	9,400.5	$	8,606.9	$	793.6	9.2
Retail used vehicle	2,025.1		2,253.1		(228.0)		(10.1)	5,858.4		7,007.5		(1,149.1)		(16.4)
Wholesale	147.0		148.6		(1.6)		(1.1)	434.3		487.0		(52.7)		(10.8)
Used vehicle	2,172.1		2,401.7		(229.6)		(9.6)	6,292.7		7,494.5		(1,201.8)		(16.0)
Finance and insurance, net	369.5		360.7		8.8		2.4	1,071.4		1,092.2		(20.8)		(1.9)
Total variable operations(1)	5,729.2		5,626.3		102.9		1.8	16,764.6		17,193.6		(429.0)		(2.5)
Parts and service	1,157.4		1,032.1		125.3		12.1	3,392.5		3,072.3		320.2		10.4
Other	6.1		7.6		(1.5)			24.4		22.1		2.3
Total revenue	$	6,892.7	$	6,666.0	$	226.7	3.4	$	20,181.5	$	20,288.0	$	(106.5)	(0.5)
Gross profit:
New vehicle	$	250.7	$	329.7	$	(79.0)	(24.0)	$	825.3	$	1,028.2	$	(202.9)	(19.7)
Retail used vehicle	126.6		140.9		(14.3)		(10.1)	398.3		413.4		(15.1)		(3.7)
Wholesale	1.2		1.1		0.1			18.2		21.7		(3.5)
Used vehicle	127.8		142.0		(14.2)		(10.0)	416.5		435.1		(18.6)		(4.3)
Finance and insurance	369.5		360.7		8.8		2.4	1,071.4		1,092.2		(20.8)		(1.9)
Total variable operations(1)	748.0		832.4		(84.4)		(10.1)	2,313.2		2,555.5		(242.3)		(9.5)
Parts and service	545.8		478.6		67.2		14.0	1,599.4		1,421.4		178.0		12.5
Other	0.8		1.8		(1.0)			3.7		6.5		(2.8)
Total gross profit	1,294.6		1,312.8		(18.2)		(1.4)	3,916.3		3,983.4		(67.1)		(1.7)
Selling, general, and administrative expenses	819.3		763.2		(56.1)		(7.4)	2,444.9		2,259.4		(185.5)		(8.2)
Depreciation and amortization	55.7		50.1		(5.6)			163.1		148.9		(14.2)


Other (income) expense, net	0.1		(23.0)		(23.1)			6.3		(24.5)		(30.8)
Operating income	419.5		522.5		(103.0)		(19.7)	1,302.0		1,599.6		(297.6)		(18.6)
Non-operating income (expense) items:
Floorplan interest expense	(38.3)		(10.7)		(27.6)			(98.2)		(21.7)		(76.5)
Other interest expense	(48.8)		(33.7)		(15.1)			(135.9)		(97.4)		(38.5)
Other income (loss), net	(5.0)		(4.6)		(0.4)			4.6		(24.7)		29.3
Income from continuing operations before income taxes	$	327.4	$	473.5	$	(146.1)	(30.9)	$	1,072.5	$	1,455.8	$	(383.3)	(26.3)
Retail vehicle unit sales:
New vehicle	62,289		55,565		6,724		12.1	179,798		169,897		9,901		5.8
Used vehicle	72,517		75,355		(2,838)		(3.8)	208,868		232,198		(23,330)		(10.0)
	134,806		130,920		3,886		3.0	388,666		402,095		(13,429)		(3.3)
Revenue per vehicle retailed:
New vehicle	$	51,174	$	51,541	$	(367)	(0.7)	$	52,284	$	50,660	$	1,624	3.2
Used vehicle	$	27,926	$	29,900	$	(1,974)	(6.6)	$	28,048	$	30,179	$	(2,131)	(7.1)
Gross profit per vehicle retailed:
New vehicle	$	4,025	$	5,934	$	(1,909)	(32.2)	$	4,590	$	6,052	$	(1,462)	(24.2)
Used vehicle	$	1,746	$	1,870	$	(124)	(6.6)	$	1,907	$	1,780	$	127	7.1
Finance and insurance	$	2,741	$	2,755	$	(14)	(0.5)	$	2,757	$	2,716	$	41	1.5
Total variable operations(2)	$	5,540	$	6,350	$	(810)	(12.8)	$	5,905	$	6,301	$	(396)	(6.3)

(1) Total variable operations includes new vehicle, used vehicle (retail and wholesale), and finance and insurance results.
(2) Total variable operations gross profit per vehicle retailed is calculated by dividing the sum of new vehicle, retail used vehicle, and finance and insurance gross profit by total retail vehicle unit sales.

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	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2023 (%)	2022 (%)	2023 (%)	2022 (%)
Revenue mix percentages:
New vehicle	46.2	43.0	46.6	42.4
Used vehicle	31.5	36.0	31.2	36.9
Parts and service	16.8	15.5	16.8	15.1
Finance and insurance, net	5.4	5.4	5.3	5.4
Other	0.1	0.1	0.1	0.2
Total	100.0	100.0	100.0	100.0
Gross profit mix percentages:
New vehicle	19.4	25.1	21.1	25.8
Used vehicle	9.9	10.8	10.6	10.9
Parts and service	42.2	36.5	40.8	35.7
Finance and insurance	28.5	27.5	27.4	27.4
Other	—	0.1	0.1	0.2
Total	100.0	100.0	100.0	100.0
Operating items as a percentage of revenue:
Gross profit:
New vehicle	7.9	11.5	8.8	11.9
Used vehicle - retail	6.3	6.3	6.8	5.9
Parts and service	47.2	46.4	47.1	46.3
Total	18.8	19.7	19.4	19.6
Selling, general, and administrative expenses	11.9	11.4	12.1	11.1
Operating income	6.1	7.8	6.5	7.9
Other operating items as a percentage of total gross profit:
Selling, general, and administrative expenses	63.3	58.1	62.4	56.7
Operating income	32.4	39.8	33.2	40.2

	September 30,
	2023	2022
Inventory days supply:
New vehicle (industry standard of selling days)	31 days	15 days
Used vehicle (trailing calendar month days)	33 days	34 days

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Same Store Operating Data

We have presented below our operating results on a same store basis to reflect our internal performance. The “Same Store” amounts presented below include the results of our stores for the identical months in each period presented in the comparison, commencing with the first full month in which the store was owned by us. Results from divested stores are excluded from both current and prior periods. Therefore, the amounts presented in the 2022 columns may differ from the same store amounts presented for 2022 in the prior year. We believe the presentation of this information provides a meaningful comparison of period-over-period results of our operations.


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions, except per vehicle data)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Revenue:
New vehicle	$	3,117.8	$	2,856.9	$	260.9	9.1	$	9,273.4	$	8,572.1	$	701.3	8.2
Retail used vehicle	1,955.5		2,248.4		(292.9)		(13.0)	5,685.7		6,976.6		(1,290.9)		(18.5)
Wholesale	142.6		147.7		(5.1)		(3.5)	424.8		484.3		(59.5)		(12.3)
Used vehicle	2,098.1		2,396.1		(298.0)		(12.4)	6,110.5		7,460.9		(1,350.4)		(18.1)
Finance and insurance, net	359.7		360.1		(0.4)		(0.1)	1,047.8		1,088.5		(40.7)		(3.7)
Total variable operations(1)	5,575.6		5,613.1		(37.5)		(0.7)	16,431.7		17,121.5		(689.8)		(4.0)
Parts and service	1,127.3		1,027.6		99.7		9.7	3,321.6		3,052.7		268.9		8.8
Other	5.9		7.6		(1.7)			24.1		22.1		2.0
Total revenue	$	6,708.8	$	6,648.3	$	60.5	0.9	$	19,777.4	$	20,196.3	$	(418.9)	(2.1)
Gross profit:
New vehicle	$	245.7	$	328.9	$	(83.2)	(25.3)	$	815.2	$	1,024.4	$	(209.2)	(20.4)
Retail used vehicle	121.8		140.9		(19.1)		(13.6)	386.5		412.5		(26.0)		(6.3)
Wholesale	1.6		1.2		0.4			18.8		21.9		(3.1)
Used vehicle	123.4		142.1		(18.7)		(13.2)	405.3		434.4		(29.1)		(6.7)
Finance and insurance	359.7		360.1		(0.4)		(0.1)	1,047.8		1,088.5		(40.7)		(3.7)
Total variable operations(1)	728.8		831.1		(102.3)		(12.3)	2,268.3		2,547.3		(279.0)		(11.0)
Parts and service	534.1		475.2		58.9		12.4	1,568.7		1,408.9		159.8		11.3
Other	0.6		1.7		(1.1)			3.5		6.4		(2.9)
Total gross profit	$	1,263.5	$	1,308.0	$	(44.5)	(3.4)	$	3,840.5	$	3,962.6	$	(122.1)	(3.1)
Retail vehicle unit sales:
New vehicle	60,690		55,464		5,226		9.4	177,094		169,391		7,703		4.5
Used vehicle	69,670		75,235		(5,565)		(7.4)	201,875		231,367		(29,492)		(12.7)
	130,360		130,699		(339)		(0.3)	378,969		400,758		(21,789)		(5.4)
Revenue per vehicle retailed:
New vehicle	$	51,373	$	51,509	$	(136)	(0.3)	$	52,364	$	50,605	$	1,759	3.5
Used vehicle	$	28,068	$	29,885	$	(1,817)	(6.1)	$	28,164	$	30,154	$	(1,990)	(6.6)
Gross profit per vehicle retailed:
New vehicle	$	4,048	$	5,930	$	(1,882)	(31.7)	$	4,603	$	6,048	$	(1,445)	(23.9)
Used vehicle	$	1,748	$	1,873	$	(125)	(6.7)	$	1,915	$	1,783	$	132	7.4
Finance and insurance	$	2,759	$	2,755	$	4	0.1	$	2,765	$	2,716	$	49	1.8
Total variable operations(2)	$	5,578	$	6,350	$	(772)	(12.2)	$	5,936	$	6,302	$	(366)	(5.8)

(1) Total variable operations includes new vehicle, used vehicle (retail and wholesale), and finance and insurance results.
(2) Total variable operations gross profit per vehicle retailed is calculated by dividing the sum of new vehicle, retail used vehicle, and finance and insurance gross profit by total retail vehicle unit sales.

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	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2023 (%)	2022 (%)	2023 (%)	2022 (%)
Revenue mix percentages:
New vehicle	46.5	43.0	46.9	42.4
Used vehicle	31.3	36.0	30.9	36.9
Parts and service	16.8	15.5	16.8	15.1
Finance and insurance, net	5.4	5.4	5.3	5.4
Other	—	0.1	0.1	0.2
Total	100.0	100.0	100.0	100.0
Gross profit mix percentages:
New vehicle	19.4	25.1	21.2	25.9
Used vehicle	9.8	10.9	10.6	11.0
Parts and service	42.3	36.3	40.8	35.6
Finance and insurance	28.5	27.5	27.3	27.5
Other	—	0.2	0.1	—
Total	100.0	100.0	100.0	100.0
Operating items as a percentage of revenue:
Gross profit:
New vehicle	7.9	11.5	8.8	12.0
Used vehicle - retail	6.2	6.3	6.8	5.9
Parts and service	47.4	46.2	47.2	46.2
Total	18.8	19.7	19.4	19.6

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New Vehicle


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions, except per vehicle data)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Reported:
Revenue	$	3,187.6	$	2,863.9	$	323.7	11.3	$	9,400.5	$	8,606.9	$	793.6	9.2
Gross profit	$	250.7	$	329.7	$	(79.0)	(24.0)	$	825.3	$	1,028.2	$	(202.9)	(19.7)
Retail vehicle unit sales	62,289		55,565		6,724		12.1	179,798		169,897		9,901		5.8
Revenue per vehicle retailed	$	51,174	$	51,541	$	(367)	(0.7)	$	52,284	$	50,660	$	1,624	3.2
Gross profit per vehicle retailed	$	4,025	$	5,934	$	(1,909)	(32.2)	$	4,590	$	6,052	$	(1,462)	(24.2)
Gross profit as a percentage of revenue	7.9%		11.5%					8.8%		11.9%
Inventory days supply (industry standard of selling days)	31 days		15 days

	Three Months Ended September 30,							Nine Months Ended September 30,
	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Same Store:
Revenue	$	3,117.8	$	2,856.9	$	260.9	9.1	$	9,273.4	$	8,572.1	$	701.3	8.2
Gross profit	$	245.7	$	328.9	$	(83.2)	(25.3)	$	815.2	$	1,024.4	$	(209.2)	(20.4)
Retail vehicle unit sales	60,690		55,464		5,226		9.4	177,094		169,391		7,703		4.5
Revenue per vehicle retailed	$	51,373	$	51,509	$	(136)	(0.3)	$	52,364	$	50,605	$	1,759	3.5
Gross profit per vehicle retailed	$	4,048	$	5,930	$	(1,882)	(31.7)	$	4,603	$	6,048	$	(1,445)	(23.9)
Gross profit as a percentage of revenue	7.9%		11.5%					8.8%		12.0%

The following discussion of new vehicle results is on a same store basis. The difference between reported amounts and same store amounts in the above tables of $69.8 million and $7.0 million in new vehicle revenue and $5.0 million and $0.8 million in new vehicle gross profit for the three months ended September 30, 2023 and 2022, respectively, and $127.1 million and $34.8 million in new vehicle revenue and $10.1 million and $3.8 million in new vehicle gross profit for the nine months ended September 30, 2023 and 2022, respectively, is related to acquisition and divestiture activity.

Third Quarter 2023 compared to Third Quarter 2022

Same store new vehicle revenue increased during the three months ended September 30, 2023, as compared to the same period in 2022, due to an increase in same store unit volume, which benefited from increasing supply of new vehicle inventory, particularly for Import manufacturers, and sustained consumer demand.

Same store revenue PVR was relatively flat during the three months ended September 30, 2023, as compared to the same period in 2022. Same store revenue PVR was adversely impacted by a shift in mix to Import vehicles, which have relatively lower average selling prices. The decrease in revenue PVR was partially offset by increases in manufacturers’ suggested retail prices, particularly for Premium Luxury vehicles.

Same store gross profit PVR decreased during the three months ended September 30, 2023, as compared to the same period in 2022. The prior year was impacted by a shortage of new vehicles available for sale due to disruptions in the manufacturers’ supply chains, which resulted in higher levels of profitability for new vehicle sales due to the demand and supply imbalance. In 2023, the increasing supply and availability of new vehicle inventory has resulted in moderation of pricing and margins. In addition, same store gross profit PVR was adversely impacted by the shift in mix to Import vehicles, which have a relatively lower average gross profit PVR.

First Nine Months 2023 compared to First Nine Months 2022

Same store new vehicle revenue increased during the nine months ended September 30, 2023, as compared to the same period in 2022, due to increases in same store unit volume and same store revenue PVR. Same store unit volume benefited from increasing supply of new vehicle inventory, particularly for Import manufacturers, and sustained consumer demand.

Same store revenue PVR increased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to increases in manufacturers’ suggested retail prices, particularly for Premium Luxury vehicles.

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Same store gross profit PVR decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to increasing supply and availability of new vehicle inventory, which has resulted in moderation of pricing and margins.

New Vehicle Inventory Carrying Benefit (Expense)

The following table details net new vehicle inventory carrying benefit (expense), consisting of new vehicle floorplan interest expense, net of floorplan assistance earned (amounts received from manufacturers specifically to support store financing of new vehicle inventory). Floorplan assistance is accounted for as a component of new vehicle gross profit in accordance with GAAP.


	Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	2023		2022		Variance		2023		2022		Variance
Floorplan assistance	$	31.5	$	26.3	$	5.2	$	92.1	$	81.1	$	11.0
New vehicle floorplan interest expense	(35.1)		(9.4)		(25.7)		(89.1)		(18.2)		(70.9)
Net new vehicle inventory carrying benefit (expense)	$	(3.6)	$	16.9	$	(20.5)	$	3.0	$	62.9	$	(59.9)

Third Quarter 2023 compared to Third Quarter 2022

During the three months ended September 30, 2023, we had a net new vehicle inventory carrying expense of $3.6 million compared to a net new vehicle inventory carrying benefit of $16.9 million for the same period in 2022. Floorplan interest rates are variable and, therefore, increase and decrease with changes in the underlying benchmark interest rates. Up until the third quarter of 2023, since the first quarter of 2020, when the Federal Reserve cut interest rates to near 0%, we have had a net new vehicle inventory carrying benefit. Additionally, over this same period, our average floorplan balances have been significantly lower than historical standards due to manufacturers’ new vehicle inventory supply constraints. Increases to floorplan interest expense were partially offset by an increase in floorplan assistance due to an increase in unit volume and an increase in the average floorplan assistance rate per unit. With the increases in interest rates and new vehicle inventory supply, floorplan interest expense has increased, resulting in a net new vehicle inventory carrying expense for the three months ended September 30, 2023. If interest rates continue to increase without a corresponding increase in floorplan assistance or a decrease in average new vehicle inventory levels, we would expect that we will continue to incur a net new vehicle inventory carrying expense.

First Nine Months 2023 compared to First Nine Months 2022

The net new vehicle inventory carrying benefit decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in floorplan interest expense, partially offset by an increase in floorplan assistance. Floorplan interest expense increased due to higher average interest rates and higher average floorplan balances. Floorplan assistance increased due to an increase in the average floorplan assistance rate per unit and an increase in unit volume. As noted above, floorplan interest rates are variable and, therefore, increase and decrease with changes in the underlying benchmark interest rates. If interest rates continue to increase without a corresponding increase in floorplan assistance or a decrease in average new vehicle inventory levels, we would expect that we will incur a net new vehicle inventory carrying expense.

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Used Vehicle


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions, except per vehicle data)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Reported:
Retail revenue	$	2,025.1	$	2,253.1	$	(228.0)	(10.1)	$	5,858.4	$	7,007.5	$	(1,149.1)	(16.4)
Wholesale revenue	147.0		148.6		(1.6)		(1.1)	434.3		487.0		(52.7)		(10.8)
Total revenue	$	2,172.1	$	2,401.7	$	(229.6)	(9.6)	$	6,292.7	$	7,494.5	$	(1,201.8)	(16.0)
Retail gross profit	$	126.6	$	140.9	$	(14.3)	(10.1)	$	398.3	$	413.4	$	(15.1)	(3.7)
Wholesale gross profit	1.2		1.1		0.1			18.2		21.7		(3.5)
Total gross profit	$	127.8	$	142.0	$	(14.2)	(10.0)	$	416.5	$	435.1	$	(18.6)	(4.3)
Retail vehicle unit sales	72,517		75,355		(2,838)		(3.8)	208,868		232,198		(23,330)		(10.0)
Revenue per vehicle retailed	$	27,926	$	29,900	$	(1,974)	(6.6)	$	28,048	$	30,179	$	(2,131)	(7.1)
Gross profit per vehicle retailed	$	1,746	$	1,870	$	(124)	(6.6)	$	1,907	$	1,780	$	127	7.1
Retail gross profit as a percentage of retail revenue	6.3%		6.3%					6.8%		5.9%
Inventory days supply (trailing calendar month days)	33 days		34 days

	Three Months Ended September 30,							Nine Months Ended September 30,
	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Same Store:
Retail revenue	$	1,955.5	$	2,248.4	$	(292.9)	(13.0)	$	5,685.7	$	6,976.6	$	(1,290.9)	(18.5)
Wholesale revenue	142.6		147.7		(5.1)		(3.5)	424.8		484.3		(59.5)		(12.3)
Total revenue	$	2,098.1	$	2,396.1	$	(298.0)	(12.4)	$	6,110.5	$	7,460.9	$	(1,350.4)	(18.1)
Retail gross profit	$	121.8	$	140.9	$	(19.1)	(13.6)	$	386.5	$	412.5	$	(26.0)	(6.3)
Wholesale gross profit	1.6		1.2		0.4			18.8		21.9		(3.1)
Total gross profit	$	123.4	$	142.1	$	(18.7)	(13.2)	$	405.3	$	434.4	$	(29.1)	(6.7)
Retail vehicle unit sales	69,670		75,235		(5,565)		(7.4)	201,875		231,367		(29,492)		(12.7)
Revenue per vehicle retailed	$	28,068	$	29,885	$	(1,817)	(6.1)	$	28,164	$	30,154	$	(1,990)	(6.6)
Gross profit per vehicle retailed	$	1,748	$	1,873	$	(125)	(6.7)	$	1,915	$	1,783	$	132	7.4
Retail gross profit as a percentage of retail revenue	6.2%		6.3%					6.8%		5.9%

The following discussion of used vehicle results is on a same store basis. The difference between reported amounts and same store amounts in the above tables of $74.0 million and $5.6 million in total used vehicle revenue and $4.4 million and $0.1 million in total used vehicle gross profit for the three months ended September 30, 2023 and 2022, respectively, and $182.2 million and $33.6 million in total used vehicle revenue and $11.2 million and $0.7 million in total used vehicle gross profit for the nine months ended September 30, 2023 and 2022, respectively, is related to acquisition and divestiture activity, as well as the opening of AutoNation USA stores.

Third Quarter 2023 compared to Third Quarter 2022

Same store retail used vehicle revenue decreased during the three months ended September 30, 2023, as compared to the same period in 2022, due to a decrease in same store unit volume and a decrease in same store revenue PVR. The decrease in same store unit volume, particularly for mid- to higher-priced used vehicles, is due in part to lower availability and levels of nearly new vehicle inventory as a result of the decline in new vehicle unit volume in recent years. Additionally, increasing supply of new vehicle inventory resulted in a shift in mix from used vehicles to new vehicles.

Same store revenue PVR decreased during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to a shift in mix towards lower-priced entry-level vehicles.

Same store gross profit PVR decreased during the three months ended September 30, 2023, as compared to the same period in 2022 due to a shift in mix towards lower-priced entry-level vehicles, which have a lower average gross profit PVR.

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First Nine Months 2023 compared to First Nine Months 2022

Same store retail used vehicle revenue decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, due to a decrease in same store unit volume and a decrease in same store revenue PVR. The decrease in same store unit volume, particularly for mid- to higher-priced used vehicles, is due in part to lower availability and levels of nearly new vehicle inventory as a result of the decline in new vehicle unit volume in recent years. Additionally, increasing supply of new vehicle inventory resulted in a shift in mix from used vehicles to new vehicles.

Same store revenue PVR decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to a shift in mix towards lower-priced entry-level vehicles.

Same store gross profit PVR increased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to a disciplined sourcing and pricing strategy as we focused on efficient internal sourcing of our used vehicle inventory and balancing gross profit PVR and unit volume. The increase in gross profit PVR was partially offset by the shift in mix towards lower-priced entry-level vehicles, which have a lower average gross profit PVR.

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Parts and Service


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Reported:
Revenue	$	1,157.4	$	1,032.1	$	125.3	12.1	$	3,392.5	$	3,072.3	$	320.2	10.4
Gross Profit	$	545.8	$	478.6	$	67.2	14.0	$	1,599.4	$	1,421.4	$	178.0	12.5
Gross profit as a percentage of revenue	47.2%		46.4%					47.1%		46.3%

Same Store:
Revenue	$	1,127.3	$	1,027.6	$	99.7	9.7	$	3,321.6	$	3,052.7	$	268.9	8.8
Gross Profit	$	534.1	$	475.2	$	58.9	12.4	$	1,568.7	$	1,408.9	$	159.8	11.3
Gross profit as a percentage of revenue	47.4%		46.2%					47.2%		46.2%

Parts and service revenue is primarily derived from vehicle repairs paid directly by customers or via reimbursement from manufacturers and others under warranty programs, as well as from wholesale parts sales, collision services, and the preparation of vehicles for sale.

The following discussion of parts and service results is on a same store basis. The difference between reported amounts and same store amounts in the above tables of $30.1 million and $4.5 million in parts and service revenue and $11.7 million and $3.4 million in parts and service gross profit for the three months ended September 30, 2023 and 2022, respectively, and $70.9 million and $19.6 million in parts and service revenue and $30.7 million and $12.5 million in parts and service gross profit for the nine months ended September 30, 2023 and 2022, respectively, is related to acquisition and divestiture activity, as well as the opening of AutoNation USA stores.

Third Quarter 2023 compared to Third Quarter 2022

During the three months ended September 30, 2023, same store parts and service revenue increased compared to the same period in 2022, primarily due to increases in revenue associated with customer-pay service of $40.5 million, the preparation of vehicles for sale of $27.1 million, and warranty service of $16.2 million. During the three months ended September 30, 2023, same store parts and service gross profit increased compared to the same period in 2022, primarily due to increases in gross profit associated with customer-pay service of $25.4 million, the preparation of vehicles for sale of $13.8 million, and warranty service of $12.6 million. Revenue and gross profit associated with customer-pay service and the preparation of vehicles for sale benefited from higher value repair orders and an increase in repair order volume. Warranty service revenue and gross profit benefited from higher value repair orders and improved parts and labor rates.

First Nine Months 2023 compared to First Nine Months 2022

During the nine months ended September 30, 2023, same store parts and service revenue increased compared to the same period in 2022, primarily due to increases in revenue associated with customer-pay service of $127.3 million, warranty service of $51.5 million, and the preparation of vehicles for sale of $50.2 million. During the nine months ended September 30, 2023, same store parts and service gross profit increased compared to the same period in 2022, primarily due to increases in gross profit associated with customer-pay service of $76.2 million, warranty service of $37.3 million, and the preparation of vehicles for sale of $22.0 million. Revenue and gross profit associated with customer-pay service benefited from higher value repair orders. Warranty service revenue and gross profit benefited from higher value repair orders and improved parts and labor rates. Revenue and gross profit associated with the preparation of vehicles for sale benefited from higher value repair orders and an increase in repair order volume.

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Finance and Insurance


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions, except per vehicle data)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Reported:
Revenue and gross profit	$	369.5	$	360.7	$	8.8	2.4	$	1,071.4	$	1,092.2	$	(20.8)	(1.9)
Gross profit per vehicle retailed	$	2,741	$	2,755	$	(14)	(0.5)	$	2,757	$	2,716	$	41	1.5

Same Store:
Revenue and gross profit	$	359.7	$	360.1	$	(0.4)	(0.1)	$	1,047.8	$	1,088.5	$	(40.7)	(3.7)
Gross profit per vehicle retailed	$	2,759	$	2,755	$	4	0.1	$	2,765	$	2,716	$	49	1.8

Revenue on finance and insurance products represents commissions earned by us for the placement of: (i) loans and leases with financial institutions in connection with customer vehicle purchases financed, (ii) vehicle service contracts with third-party providers, and (iii) other vehicle protection products with third-party providers. We sell these products on a commission basis, and we also participate in the future underwriting profit on certain products pursuant to retrospective commission arrangements with the issuers of those products.

The following discussion of finance and insurance results is on a same store basis. The difference between reported amounts and same store amounts in finance and insurance revenue and gross profit in the above tables of $9.8 million and $0.6 million for the three months ended September 30, 2023 and 2022, respectively, and $23.6 million and $3.7 million for the nine months ended September 30, 2023 and 2022, respectively, is related to acquisition and divestiture activity, as well as the opening of AutoNation USA stores.

Third Quarter 2023 compared to Third Quarter 2022

Same store finance and insurance revenue and gross profit decreased slightly during the three months ended September 30, 2023, as compared to the same period in 2022, due to a decrease in used vehicle unit volume, largely offset by increases in new vehicle unit volume and finance and insurance gross profit PVR. Finance and insurance gross profit PVR benefited from an increase in product penetration on vehicle protection products, as well as a shift in mix from used vehicles to new vehicles, which typically generate a higher average finance and insurance gross profit PVR. The increases in finance and insurance gross profit PVR were largely offset by a decrease in gross profit associated with arranging customer financing.

First Nine Months 2023 compared to First Nine Months 2022

Same store finance and insurance revenue and gross profit decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, due to a decrease in used vehicle unit volume, partially offset by increases in new vehicle unit volume and finance and insurance gross profit PVR. The increase in finance and insurance gross profit PVR was primarily due to an increase in product penetration and higher realized margins on vehicle protection products, as well as a shift in mix from used vehicles to new vehicles, which typically generate a higher average finance and insurance gross profit PVR. The increases in finance and insurance gross profit PVR were partially offset by a decrease in gross profit associated with arranging customer financing.

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Segment Results

In the following table of financial data, revenue and segment income of our reportable segments are reconciled to consolidated revenue and consolidated operating income, respectively. The following discussions of segment results are on a reported basis.


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Revenue:
Domestic	$	1,983.9	$	2,032.8	$	(48.9)	(2.4)	$	5,770.5	$	6,108.1	$	(337.6)	(5.5)
Import	2,077.2		1,875.2		202.0		10.8	5,864.2		5,799.0		65.2		1.1
Premium Luxury	2,516.1		2,506.4		9.7		0.4	7,621.5		7,601.7		19.8		0.3
Total	6,577.2		6,414.4		162.8		2.5	19,256.2		19,508.8		(252.6)		(1.3)
Corporate and other	315.5		251.6		63.9		25.4	925.3		779.2		146.1		18.8
Total consolidated revenue	$	6,892.7	$	6,666.0	$	226.7	3.4	$	20,181.5	$	20,288.0	$	(106.5)	(0.5)
Segment income(1):
Domestic	$	107.2	$	142.7	$	(35.5)	(24.9)	$	341.5	$	445.2	$	(103.7)	(23.3)
Import	164.7		180.3		(15.6)		(8.7)	498.1		559.0		(60.9)		(10.9)
Premium Luxury	192.9		235.2		(42.3)		(18.0)	641.2		722.2		(81.0)		(11.2)
Total	464.8		558.2		(93.4)		(16.7)	1,480.8		1,726.4		(245.6)		(14.2)
Corporate and other	(83.6)		(46.4)		(37.2)			(277.0)		(148.5)		(128.5)
Floorplan interest expense	38.3		10.7		(27.6)			98.2		21.7		(76.5)
Operating income	$	419.5	$	522.5	$	(103.0)	(19.7)	$	1,302.0	$	1,599.6	$	(297.6)	(18.6)

Retail new vehicle unit sales:
Domestic	17,766		16,859		907		5.4	51,110		49,984		1,126		2.3
Import	28,232		22,309		5,923		26.5	78,502		70,457		8,045		11.4
Premium Luxury	16,291		16,397		(106)		(0.6)	50,186		49,456		730		1.5
	62,289		55,565		6,724		12.1	179,798		169,897		9,901		5.8

Retail used vehicle unit sales:
Domestic	22,406		24,827		(2,421)		(9.8)	64,914		76,603		(11,689)		(15.3)
Import	24,548		25,416		(868)		(3.4)	69,241		77,731		(8,490)		(10.9)
Premium Luxury	19,710		20,677		(967)		(4.7)	57,409		64,007		(6,598)		(10.3)
	66,664		70,920		(4,256)		(6.0)	191,564		218,341		(26,777)		(12.3)

(1) Segment income represents income for each of our reportable segments and is defined as operating income less floorplan interest expense.

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Domestic

The Domestic segment operating results included the following:


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Revenue:
New vehicle	$	916.1	$	875.0	$	41.1	4.7	$	2,667.1	$	2,555.6	$	111.5	4.4
Used vehicle	649.1		764.3		(115.2)		(15.1)	1,880.4		2,374.2		(493.8)		(20.8)
Parts and service	301.7		275.8		25.9		9.4	888.0		820.0		68.0		8.3
Finance and insurance, net	115.6		117.1		(1.5)		(1.3)	332.2		355.7		(23.5)		(6.6)
Other	1.4		0.6		0.8			2.8		2.6		0.2
Total Revenue	$	1,983.9	$	2,032.8	$	(48.9)	(2.4)	$	5,770.5	$	6,108.1	$	(337.6)	(5.5)
Segment income	$	107.2	$	142.7	$	(35.5)	(24.9)	$	341.5	$	445.2	$	(103.7)	(23.3)
Retail new vehicle unit sales	17,766		16,859		907		5.4	51,110		49,984		1,126		2.3
Retail used vehicle unit sales	22,406		24,827		(2,421)		(9.8)	64,914		76,603		(11,689)		(15.3)

Third Quarter 2023 compared to Third Quarter 2022

Domestic revenue decreased during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to decreases in used vehicle unit volume and used vehicle revenue PVR. The decrease in used vehicle unit volume is due in part to lower availability and levels of nearly new vehicle inventory. The decrease in used vehicle revenue PVR is primarily due to a shift in mix towards lower-priced entry-level vehicles. Decreases in Domestic revenue were partially offset by an increase in new vehicle unit volume due to increasing supply of new vehicle inventory and sustained consumer demand, as well as increases in parts and service revenue associated with customer-pay service and warranty service. Domestic revenue also benefited from the acquisitions we completed in 2022 and 2023.

Domestic segment income decreased during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to decreases in new and used vehicle gross profit and an increase in floorplan interest expense. New vehicle gross profit was adversely impacted by continued moderation of pricing and margins resulting from the increasing supply of new vehicle inventory. Used vehicle gross profit was adversely impacted by a shift in mix towards lower-priced entry-level vehicles. Decreases in Domestic segment income were partially offset by increases in parts and service gross profit associated with customer-pay service and warranty service.

First Nine Months 2023 compared to First Nine Months 2022

Domestic revenue decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to decreases in used vehicle unit volume and used vehicle revenue PVR. The decrease in used vehicle unit volume is due in part to lower availability and levels of nearly new vehicle inventory. The decrease in used vehicle revenue PVR is primarily due to a shift in mix towards lower-priced entry-level vehicles. Decreases in Domestic revenue were partially offset by an increase in new vehicle revenue PVR due to increases in manufacturers’ suggested retail prices, an increase in new vehicle unit volume due to increasing supply of new vehicle inventory and sustained consumer demand, and an increase in parts and service revenue associated with customer-pay service and warranty service. Additionally, Domestic revenue benefited from the acquisitions we completed in 2022 and 2023.

Domestic segment income decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to decreases in new vehicle gross profit and finance and insurance gross profit. New vehicle gross profit was adversely impacted by continued moderation of pricing and margins resulting from the increasing supply of new vehicle inventory. Finance and insurance gross profit was adversely impacted by the decrease in used vehicle unit volume. Domestic segment income was also adversely impacted by an increase in floorplan interest expense. Decreases in segment income were partially offset by increases in parts and service gross profit associated with customer-pay service and warranty service.

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Import

The Import segment operating results included the following:


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Revenue:
New vehicle	$	1,042.5	$	814.1	$	228.4	28.1	$	2,910.1	$	2,548.1	$	362.0	14.2
Used vehicle	602.4		667.4		(65.0)		(9.7)	1,707.7		2,074.6		(366.9)		(17.7)
Parts and service	299.6		266.2		33.4		12.5	859.3		788.0		71.3		9.0
Finance and insurance, net	129.1		123.1		6.0		4.9	369.5		375.2		(5.7)		(1.5)
Other	3.6		4.4		(0.8)			17.6		13.1		4.5
Total Revenue	$	2,077.2	$	1,875.2	$	202.0	10.8	$	5,864.2	$	5,799.0	$	65.2	1.1
Segment income	$	164.7	$	180.3	$	(15.6)	(8.7)	$	498.1	$	559.0	$	(60.9)	(10.9)
Retail new vehicle unit sales	28,232		22,309		5,923		26.5	78,502		70,457		8,045		11.4
Retail used vehicle unit sales	24,548		25,416		(868)		(3.4)	69,241		77,731		(8,490)		(10.9)

Third Quarter 2023 compared to Third Quarter 2022

Import revenue increased during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in new vehicle unit volume due to the increasing supply of new vehicle inventory and sustained consumer demand. Increases in Import revenue were partially offset by a decrease in used vehicle revenue PVR, primarily due to a shift in mix towards lower-priced entry-level vehicles, and a decrease in used vehicle unit volume due in part to lower availability and levels of nearly new vehicle inventory. Import revenue also benefited from the acquisitions we completed in 2022 and 2023.

Import segment income decreased during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in SG&A expenses, largely driven by the acquisitions we completed in 2022 and 2023, and a decrease in new vehicle gross profit PVR, which was adversely impacted by continued moderation of pricing and margins resulting from the increasing supply of new vehicle inventory. Import segment income was also adversely impacted by a decrease in used vehicle gross profit due to the decrease in used vehicle unit volume and a shift in mix towards lower-priced entry-level vehicles. Decreases in Import segment income were partially offset by the increase in new vehicle unit volume and increases in parts and service gross profit associated with customer-pay service and the preparation of vehicles for sale.

First Nine Months 2023 compared to First Nine Months 2022

Import revenue increased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in new vehicle unit volume due to the increasing supply of new vehicle inventory and sustained consumer demand, as well as an increase in new vehicle revenue PVR, which benefited from increases in manufacturers’ suggested retail prices. Import revenue also benefited from an increase in parts and service revenue associated with customer-pay service and the preparation of vehicles for sale, as well as the acquisitions we completed in 2022 and 2023. Increases in Import revenue were partially offset by decreases in used vehicle unit volume, due in part to lower availability and levels of nearly new vehicle inventory, and used vehicle revenue PVR, primarily due to a shift in mix towards lower-priced entry-level vehicles.

Import segment income decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to decreases in new vehicle gross profit PVR, which was adversely impacted by continued moderation of pricing and margins resulting from the increasing supply of new vehicle inventory. Import segment income was also adversely impacted by an increase in SG&A expenses, largely driven by the acquisitions we completed in 2022 and 2023, and an increase in floorplan interest expense. Decreases in segment income were partially offset by an increase in parts and service gross profit associated with customer-pay service and the preparation of vehicles for sale.

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Premium Luxury

The Premium Luxury segment operating results included the following:


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Revenue:
New vehicle	$	1,229.0	$	1,174.8	$	54.2	4.6	$	3,823.3	$	3,503.2	$	320.1	9.1
Used vehicle	773.1		853.0		(79.9)		(9.4)	2,275.8		2,673.7		(397.9)		(14.9)
Parts and service	402.4		364.5		37.9		10.4	1188.9		1083.4		105.5		9.7
Finance and insurance, net	111.5		112.5		(1.0)		(0.9)	332.3		338.1		(5.8)		(1.7)
Other	0.1		1.6		(1.5)			1.2		3.3		(2.1)
Total Revenue	$	2,516.1	$	2,506.4	$	9.7	0.4	$	7,621.5	$	7,601.7	$	19.8	0.3
Segment income	$	192.9	$	235.2	$	(42.3)	(18.0)	$	641.2	$	722.2	$	(81.0)	(11.2)
Retail new vehicle unit sales	16,291		16,397		(106)		(0.6)	50,186		49,456		730		1.5
Retail used vehicle unit sales	19,710		20,677		(967)		(4.7)	57,409		64,007		(6,598)		(10.3)

Third Quarter 2023 compared to Third Quarter 2022

Premium Luxury revenue increased slightly during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in new vehicle revenue PVR, which benefited from increases in manufacturers’ suggested retail prices, and an increase in parts and service revenue associated with customer-pay service and the preparation of vehicles for sale. Increases in Premium Luxury revenue were partially offset by a decrease in used vehicle unit volume, due in part to lower availability and levels of nearly new vehicle inventory, and a decrease in used vehicle revenue PVR, primarily due to a shift in mix towards lower-priced entry-level vehicles.

Premium Luxury segment income decreased during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to a decrease in new vehicle gross profit, which was adversely impacted by continued moderation of pricing and margins resulting from the increasing supply of new vehicle inventory, as well as an increase in floorplan interest expense. Decreases in Premium Luxury segment income were partially offset by increases in parts and service gross profit associated with customer-pay service and warranty service.

First Nine Months 2023 compared to First Nine Months 2022

Premium Luxury revenue increased slightly during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in new vehicle revenue PVR, which benefited from increases in manufacturers’ suggested retail prices, and an increase in parts and service revenue associated with customer-pay service and warranty service. Increases in Premium Luxury revenue were partially offset by a decrease in used vehicle unit volume, due in part to lower availability and levels of nearly new vehicle inventory, a decrease in used vehicle revenue PVR, primarily due to a shift in mix towards lower-priced entry-level vehicles, and a decrease in used vehicle wholesale revenue.

Premium Luxury segment income decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to a decrease in new vehicle gross profit, which was adversely impacted by continued moderation of pricing and margins resulting from the increasing supply of new vehicle inventory, as well as increases in floorplan interest and SG&A expenses. Decreases in Premium Luxury segment income were partially offset by increases in parts and service gross profit associated with customer-pay service and warranty service.

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Corporate and other

Corporate and other results included the following:


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Revenue:
Used vehicle	$	147.5	$	117.0	$	30.5	26.1	$	428.8	$	372.0	$	56.8	15.3
Parts and service	153.7		125.6		28.1		22.4	456.3		380.9		75.4		19.8
Finance and insurance, net	13.3		8.0		5.3		66.3	37.4		23.2		14.2		61.2
Other	1.0		1.0		—			2.8		3.1		(0.3)
Revenue	$	315.5	$	251.6	$	63.9	25.4	$	925.3	$	779.2	$	146.1	18.8
Income (loss)	$	(83.6)	$	(46.4)	$	(37.2)		$	(277.0)	$	(148.5)	$	(128.5)

“Corporate and other” is comprised of our other businesses, including AutoNation USA used vehicle stores, collision centers, parts distribution centers, auction operations, and our mobile automotive repair and maintenance business, all of which generate revenues but do not meet the quantitative thresholds for reportable segments, as well as the results of our auto finance company, unallocated corporate overhead expenses, and other income items. As of September 30, 2023, we had 53 AutoNation-branded collision centers, 17 AutoNation USA stores, 4 AutoNation-branded automotive auction operations, 3 parts distribution centers, a mobile automotive repair and maintenance business, and an auto finance company, referred to as AutoNation Finance.

Revenue from “Corporate and other” increased for the three and nine months ended September 30, 2023, as compared to the same periods in 2022, primarily due to increases in revenue from AutoNation USA stores, collision centers, and our mobile automotive repair and maintenance business.

The loss from “Corporate and other” increased for the three and nine months ended September 30, 2023, as compared to the same periods in 2022, primarily due to expenditures associated with acquisitions, newly opened AutoNation USA stores, and investments in technology and strategic initiatives, an increase in self-insurance losses related to hailstorms and other natural catastrophes, and a decrease in gains from business/property divestitures, partially offset by increases in gross profit from AutoNation USA stores, collision centers, and our mobile automotive repair and maintenance business. The loss from “Corporate and other” for the nine months ended September 30, 2023, as compared to the same period in 2022, was also adversely impacted by an increase in deferred compensation obligations as a result of changes in market performance of the underlying investments.

AutoNation USA Stores

During the nine months ended September 30, 2023, we opened four AutoNation USA used vehicle stores and currently have over 20 stores under development. These stores play an integral part of both our long-term growth plans and the achievement of scale, scope, and density in markets to better serve and meet the needs of customers. A number of variables may impact the implementation of our expansion plans, including customer adoption, market conditions, availability of used vehicle inventory, availability and cost of building supplies and materials, and our ability to identify, acquire, and build out suitable locations in a timely manner.

Mobile Automotive Repair and Maintenance

In the first quarter of 2023, we acquired RepairSmith, a mobile solution for automotive repair and maintenance services. Revenue and gross profit from this business are included within “parts and service.”

AutoNation Finance

AutoNation Finance, our captive auto finance company, provides financing to qualified retail customers on certain vehicles we sell. AutoNation Finance operating results include the interest and fee income generated by auto loans receivable less the interest expense associated with the debt issued to fund these receivables, a provision for estimated credit losses on the auto loans receivable originated or acquired, direct expenses, and gains or losses on the sale of loans receivable. Interest income on auto loans receivable is recognized over the contractual term of the related loans.

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In September 2023, we discontinued acquiring installment contracts from third-party independent dealers. We plan to continue to increase finance penetration rates for retail vehicle sales through our stores, which we expect will favorably impact the operating results of our auto finance business over time. AutoNation Finance results are included in Other (Income) Expense, Net in our Unaudited Condensed Consolidated Statements of Income. See Notes 5 and 8 of the Notes to Unaudited Condensed Consolidated Financial Statements for more information on auto loans receivable, the related allowance for credit losses, and the related debt of our auto finance company.

Selling, General, and Administrative Expenses

Our Selling, General, and Administrative (“SG&A”) expenses consist primarily of compensation, including store and corporate salaries, commissions, and incentive-based compensation, as well as advertising (net of reimbursement-based manufacturer advertising rebates), and store and corporate overhead expenses, which include occupancy costs, outside service costs, information technology expenses, service loaner and rental inventory expenses, legal, accounting, and professional services, and general corporate expenses. The following table presents the major components of our SG&A expenses.


	Three Months Ended September 30,							Nine Months Ended September 30,
($ in millions)	2023		2022		Variance Favorable / (Unfavorable)		% Variance	2023		2022		Variance Favorable / (Unfavorable)		% Variance
Reported:
Compensation	$	532.8	$	514.6	$	(18.2)	(3.5)	$	1,603.8	$	1,553.9	$	(49.9)	(3.2)
Advertising	64.1		49.1		(15.0)		(30.5)	178.2		133.5		(44.7)		(33.5)
Store and corporate overhead	222.4		199.5		(22.9)		(11.5)	662.9		572.0		(90.9)		(15.9)
Total	$	819.3	$	763.2	$	(56.1)	(7.4)	$	2,444.9	$	2,259.4	$	(185.5)	(8.2)

SG&A as a % of total gross profit:
Compensation	41.2		39.2		(200)		bps	41.0		39.0		(200)		bps
Advertising	5.0		3.7		(130)		bps	4.6		3.4		(120)		bps
Store and corporate overhead	17.1		15.2		(190)		bps	16.8		14.3		(250)		bps
Total	63.3		58.1		(520)		bps	62.4		56.7		(570)		bps

Third Quarter 2023 compared to Third Quarter 2022

SG&A expenses increased during the three months ended September 30, 2023, as compared to the same period in 2022, primarily due to acquisitions and newly opened stores, expenditures associated with investments in technology and strategic initiatives, an increase in advertising expenses to support our used vehicle internal sourcing strategy, and self-insurance losses of $5.0 million related to hailstorms and other natural catastrophes, partially offset by a decrease in performance-driven compensation expense. As a percentage of total gross profit, SG&A expenses increased to 63.3% during the three months ended September 30, 2023, from 58.1% in the same period in 2022, primarily due to gross margin pressure and an increase in SG&A expenses related to newly acquired and opened stores and investments in technology and strategic initiatives.

First Nine Months 2023 compared to First Nine Months 2022

SG&A expenses increased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to acquisitions and newly opened stores, expenditures associated with investments in technology and strategic initiatives, an increase in advertising expenses to support our used vehicle internal sourcing strategy, an increase in deferred compensation obligations of $31.3 million as a result of changes in market performance of the underlying investments, and self-insurance losses of $21.5 million related to hailstorms and other natural catastrophes. Increases in SG&A expenses were partially offset by a decrease in performance-driven compensation expense. As a percentage of total gross profit, SG&A expenses increased to 62.4% during the nine months ended September 30, 2023, from 56.7% in the same period in 2022, primarily due to gross margin pressure and an increase in SG&A expenses related to newly acquired and opened stores, investments in technology and strategic initiatives, an increase in deferred compensation obligations, and hail-related losses.

Other (Income) Expense, Net (Operating)

Other (Income) Expense, Net includes the gains or losses associated with business/property divestitures, legal settlements, and asset impairments, among other items, and for the three and nine months ended September 30, 2023, the results of our recently acquired auto finance company, including net interest margin, the provision for expected credit losses, direct expenses,

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and gains or losses on the sale of loans receivable. See “Segment Results - Corporate and other” above and Notes 5 and 8 of the Notes to Unaudited Condensed Consolidated Financial Statements for more information about our auto finance company.

During the third quarter of 2022, we recognized a net gain of $16.1 million related to business/property divestitures and a gain on a legal settlement of $6.3 million.

Non-Operating Income (Expense)

Floorplan Interest Expense

Floorplan interest rates are variable and, therefore, increase and decrease with changes in the underlying benchmark interest rates.

Third Quarter 2023 compared to Third Quarter 2022

Floorplan interest expense was $38.3 million for the three months ended September 30, 2023, compared to $10.7 million for the same period in 2022. The increase in floorplan interest expense of $27.6 million was the result of higher average interest rates and higher average floorplan balances.

First Nine Months 2023 compared to First Nine Months 2022

Floorplan interest expense was $98.2 million for the nine months ended September 30, 2023, compared to $21.7 million for the same period in 2022. The increase in floorplan interest expense of $76.5 million was the result of higher average interest rates and higher average floorplan balances.

Other Interest Expense

Third Quarter 2023 compared to Third Quarter 2022

Other interest expense was $48.8 million for the three months ended September 30, 2023, compared to $33.7 million for the same period in 2022. The increase in interest expense of $15.1 million was driven by higher average debt balances and higher average interest rates.

First Nine Months 2023 compared to First Nine Months 2022

Other interest expense was $135.9 million for the nine months ended September 30, 2023, compared to $97.4 million for the same period in 2022. The increase in interest expense of $38.5 million was driven by higher average interest rates and higher average debt balances.

Other Income (Loss), Net

We recognized a net loss of $4.2 million and $5.2 million for the three months ended September 30, 2023 and 2022, respectively, and a net gain of $4.9 million and a net loss of $26.0 million for the nine months ended September 30, 2023 and 2022, respectively, related to changes in the cash surrender value of corporate-owned life insurance (“COLI”) for deferred compensation plan participants as a result of changes in market performance of the underlying investments. Gains and losses related to the COLI are substantially offset by corresponding increases and decreases, respectively, in the deferred compensation obligations, which are reflected in SG&A expenses.

We recorded an unrealized loss of $1.0 million for the three months ended September 30, 2023, and an unrealized loss of $2.3 million during the nine months ended September 30, 2023, related to the change in fair value of the underlying securities of our minority equity investments. During the period that we hold our minority equity investments, unrealized gains and losses will be recorded as the fair market values of securities with readily determinable fair values change over time, or as observable price changes are identified for securities without readily determinable fair values. See Note 13 of the Notes to Unaudited Condensed Consolidated Financial Statements for more information.

Income Tax Provision

Income taxes are provided based upon our anticipated underlying annual blended federal and state income tax rates adjusted, as necessary, for any discrete tax matters occurring during the period. As we operate in various states, our effective tax rate is also dependent upon our geographic revenue mix.

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Our effective income tax rate was 25.6% for the three months ended September 30, 2023, and 25.5% for the three months ended September 30, 2022. Our effective income tax rate was 25.0% for the nine months ended September 30, 2023, and 25.0% for the nine months ended September 30, 2022.

Discontinued Operations

Discontinued operations are related to stores that were sold or terminated prior to January 1, 2014. Results from discontinued operations, net of income taxes, were primarily related to a gain on the sale of real estate in the first quarter of 2023 associated with a store that was closed prior to January 1, 2014.

Liquidity and Capital Resources

We manage our liquidity to ensure access to sufficient funding at acceptable costs to fund our ongoing operating requirements and future capital expenditures while continuing to meet our financial obligations. We believe that our cash and cash equivalents, funds generated through operations, and amounts available under our revolving credit facility, commercial paper program, and secured used vehicle floorplan facilities will be sufficient to fund our working capital requirements, service our debt, pay our tax obligations and commitments and contingencies, and meet any seasonal operating requirements for the foreseeable future. Depending on market conditions, we may from time to time issue debt, including in private or public offerings, to augment our liquidity, to reduce our cost of capital, or for general corporate purposes.

Available Liquidity Resources

We had the following sources of liquidity available:


(In millions)	September 30, 2023			December 31, 2022
Cash and cash equivalents	$	64.0		$	72.6
Revolving credit facility	$	1,899.2	(1)	$	1,799.6
Secured used vehicle floorplan facilities (2)	$	0.3		$	0.3

(1) At September 30, 2023, we had $0.8 million of letters of credit outstanding. In addition, we use the revolving credit facility under our credit agreement as a liquidity backstop for borrowings under our commercial paper program. We had $350.0 million of commercial paper notes outstanding at September 30, 2023. See Note 8 of the Notes to Unaudited Condensed Consolidated Financial Statements for more information.

(2) Based on the eligible used vehicle inventory that could have been pledged as collateral. See Note 6 of the Notes to Unaudited Condensed Consolidated Financial Statements for more information.

In the ordinary course of business, we are required to post performance and surety bonds, letters of credit, and/or cash deposits as financial guarantees of our performance primarily relating to insurance matters. At September 30, 2023, surety bonds, letters of credit, and cash deposits totaled $111.5 million, of which $0.8 million were letters of credit. We do not currently provide cash collateral for outstanding letters of credit.

In February 2022, we filed an automatic shelf registration statement with the SEC that enables us to offer for sale, from time to time and as the capital markets permit, an unspecified amount of common stock, preferred stock, debt securities, warrants, subscription rights, depositary shares, stock purchase contracts, and units.

Capital Allocation

Our capital allocation strategy is focused on growing long-term value per share. We invest capital in our business to maintain and upgrade our existing facilities and to build new facilities for existing franchises and new AutoNation USA used vehicle stores, as well as for other strategic and technology initiatives. We also deploy capital opportunistically to complete acquisitions or investments, build facilities for newly awarded franchises, and/or repurchase our common stock and/or debt. Our capital allocation decisions are based on factors such as the expected rate of return on our investment, the market price of our common stock versus our view of its intrinsic value, the market price of our debt, the potential impact on our capital

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structure, our ability to complete acquisitions that meet our market and vehicle brand criteria and/or return on investment threshold, and limitations set forth in our debt agreements.

Share Repurchases

Our Board of Directors from time to time authorizes the repurchase of shares of our common stock up to a certain monetary limit. A summary of shares repurchased under our stock repurchase program authorized by our Board of Directors follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions, except per share data)	2023		2022		2023		2022
Shares repurchased	1.3		3.8		5.3		10.9
Aggregate purchase price (1)	$	200.0	$	428.2	$	712.4	$	1,213.1
Average purchase price per share	$	155.91	$	113.51	$	135.38	$	110.96

(1) Excludes excise tax accrual imposed under the Inflation Reduction Act of $2.0 million and $6.6 million for the three and nine months ended September 30, 2023, respectively.

As of October 25, 2023, $439.4 million remained available for share repurchases under the program. The decision to repurchase shares at any given point in time is based on factors such as the market price of our common stock versus our view of its intrinsic value, the potential impact on our capital structure (including compliance with our maximum leverage ratio and other financial covenants in our debt agreements as well as our available liquidity), and the expected return on competing uses of capital such as acquisitions or investments, capital investments in our current businesses, or repurchases of our debt.

Capital Expenditures

The following table sets forth information regarding our capital expenditures:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions)	2023		2022		2023		2022
Purchases of property and equipment, including operating lease buy-outs	$	87.0	$	75.9	$	286.0	$	236.2

At September 30, 2023, we owned approximately 79% of our new vehicle franchise store locations with a net book value of $2.4 billion, as well as other properties associated with our collision centers, AutoNation USA used vehicle stores, parts distribution centers, auction operations, and other excess properties with a net book value of $733.0 million. None of these properties are mortgaged or encumbered.

We continue to expand our AutoNation USA used vehicle stores. The planned expansion may be impacted by a number of variables, including customer adoption, market conditions, availability of used vehicle inventory, availability and cost of building supplies and materials, and our ability to identify, acquire, and build out suitable locations in a timely manner.

Acquisitions and Divestitures

During the nine months ended September 30, 2023, we acquired a mobile solution for automotive repair and maintenance, and we also purchased seven stores. We did not purchase any stores during the nine months ended September 30, 2022. We did not divest any stores during the nine months ended September 30, 2023. We divested three stores during the nine months ended September 30, 2022.


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions)	2023		2022		2023		2022
Cash used in business acquisitions, net	$	(2.2)	$	—	$	(271.1)	$	—
Cash received from business divestitures, net	$	—	$	55.2	$	—	$	55.2

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Debt

The following table sets forth our non-vehicle long-term debt, as of September 30, 2023, and December 31, 2022.



Debt Description	Maturity Date	Interest Payable	September 30, 2023		December 31, 2022
3.5% Senior Notes	November 15, 2024	May 15 and November 15	$	450.0	$	450.0
4.5% Senior Notes	October 1, 2025	April 1 and October 1	450.0		450.0
3.8% Senior Notes	November 15, 2027	May 15 and November 15	300.0		300.0
1.95% Senior Notes	August 1, 2028	February 1 and August 1	400.0		400.0
4.75% Senior Notes	June 1, 2030	June 1 and December 1	500.0		500.0
2.40% Senior Notes	August 1, 2031	February 1 and August 1	450.0		450.0
3.85% Senior Notes	March 1, 2032	March 1 and September 1	700.0		700.0
Revolving credit facility	July 18, 2028	Monthly	—		—
Finance leases and other debt	Various dates through 2041		365.3		375.5
			3,615.3		3,625.5
Less: unamortized debt discounts and debt issuance costs			(22.9)		(26.0)
Less: current maturities			(12.8)		(12.6)
Long-term debt, net of current maturities			$	3,579.6	$	3,586.9

We had commercial paper notes outstanding of $350.0 million at September 30, 2023, and $50.0 million at December 31, 2022. On August 16, 2023, we increased the maximum aggregate principal amount that may be outstanding at any time under the commercial paper program from $1.0 billion to $1.9 billion.

We had non-recourse debt under our warehouse facilities of $189.0 million at September 30, 2023, and $181.8 million at December 31, 2022, and non-recourse debt under term securitizations of consolidated variable interest entities (“VIEs”) of $59.2 million at September 30, 2023, and $146.9 million at December 31, 2022.

A downgrade in our credit ratings could negatively impact the interest rate payable on our 3.5% Senior Notes, 4.5% Senior Notes, 3.8% Senior Notes, and 4.75% Senior Notes and could negatively impact our ability to issue, or the interest rates for, commercial paper notes. Additionally, an increase in our leverage ratio could negatively impact the interest rates charged for borrowings under our revolving credit facility.

See Note 8 of the Notes to Unaudited Condensed Consolidated Financial Statements for more information on our non-vehicle long-term debt, commercial paper, and non-recourse debt.

Restrictions and Covenants

Our amended and restated credit agreement and the indentures for our senior unsecured notes contain customary covenants that place restrictions on us, including our ability to incur additional or guarantee other indebtedness, to create liens or other encumbrances, to engage in sale and leaseback transactions, to sell (or otherwise dispose of) assets, and to merge or consolidate with other entities. Our failure to comply with the covenants contained in our amended and restated credit agreement and the indentures for our senior unsecured notes could result in the acceleration of other indebtedness of AutoNation.

Under our amended and restated credit agreement, we are required to remain in compliance with a maximum leverage ratio and a minimum interest coverage ratio. The leverage ratio is a contractually defined amount principally reflecting non-vehicle debt divided by a measure of earnings. The interest coverage ratio is a contractually defined amount reflecting a measure of earnings divided by certain interest expense principally associated with vehicle floorplan payable and non-vehicle debt. The specific terms of the leverage and interest coverage ratios can be found in our amended and restated credit agreement, which is filed with our Quarterly Report on Form 10-Q for the quarter ended June 30, 2023.

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As of September 30, 2023, we were in compliance with the covenants under our credit agreement and the indentures for our senior unsecured notes. At September 30, 2023, our leverage and interest coverage ratios were as follows:


	September 30, 2023
	Requirement	Actual
Leverage ratio	≤ 3.75x	2.02x
Interest coverage ratio	≥ 3.00x	7.15x

Vehicle Floorplan Payable

The components of vehicle floorplan payable are as follows:


(In millions)	September 30, 2023		December 31, 2022
Vehicle floorplan payable - trade	$	1,358.7	$	946.6
Vehicle floorplan payable - non-trade	1,456.1		1,162.7
Vehicle floorplan payable	$	2,814.8	$	2,109.3

Vehicle floorplan facilities are due on demand, but in the case of new vehicle inventories, are generally paid within several business days after the related vehicles are sold. Vehicle floorplan facilities are primarily collateralized by vehicle inventories and related receivables. See Note 6 of the Notes to Unaudited Condensed Consolidated Financial Statements for more information on our vehicle floorplan payable.

Cash Flows

The following table summarizes the changes in our cash provided by (used in) operating, investing, and financing activities:


	Nine Months Ended
	September 30,
(In millions)	2023		2022
Net cash provided by operating activities	$	762.6	$	1,443.3
Net cash used in investing activities	$	(497.0)	$	(247.3)
Net cash used in financing activities	$	(282.6)	$	(813.6)

Cash Flows from Operating Activities

Our primary sources of operating cash flows result from the sale of vehicles, finance and insurance products, and parts and automotive repair and maintenance services, proceeds from vehicle floorplan payable-trade, and collections on auto loans receivable for vehicles sold through our stores. Our primary uses of cash from operating activities are repayments of vehicle floorplan payable-trade, purchases of inventory, personnel-related expenditures, originations of loans receivable for vehicles sold through our stores, and payments related to taxes and leased properties.

Net cash provided by operating activities decreased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in working capital requirements, a decrease in earnings, and an increase in originations of loans receivable for vehicles sold through our stores.

Cash Flows from Investing Activities

Net cash flows from investing activities consist primarily of cash used in capital additions and activity from business acquisitions, business divestitures, property dispositions, originations of and collections on auto loans receivable acquired through third-party dealers, and other transactions.

We will make facility and infrastructure upgrades and improvements from time to time as we identify projects that are required to maintain our current business or that we expect to provide us with acceptable rates of return.

Net cash used in investing activities increased during the nine months ended September 30, 2023, as compared to the same period in 2022, primarily due to an increase in cash used in acquisitions, a decrease in cash received from business

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divestitures, and an increase in purchases of property and equipment, partially offset by an increase in proceeds from the sale of auto loans receivable.

Cash Flows from Financing Activities

Net cash flows from financing activities primarily include repurchases of common stock, debt activity, and changes in vehicle floorplan payable-non-trade.

During the nine months ended September 30, 2023, we repurchased 5.3 million shares of common stock for an aggregate purchase price of $712.4 million (average purchase price per share of $135.38), excluding the 1% excise tax imposed under the Inflation Reduction Act. During the nine months ended September 30, 2022, we repurchased 10.9 million shares of common stock for an aggregate purchase price of $1.2 billion (average purchase price per share of $110.96), including repurchases for which settlement occurred subsequent to September 30, 2022.

Cash flows from financing activities include changes in commercial paper notes outstanding totaling net proceeds of $300.0 million and net payments of $340.0 million during the nine months ended September 30, 2023 and 2022, respectively, and vehicle floorplan payable-non-trade totaling net proceeds of $260.4 million and $46.4 million during the nine months ended September 30, 2023 and 2022, respectively.

During the nine months ended September 30, 2023, we borrowed $151.6 million and repaid $232.1 million under our non-recourse debt facilities.

During the nine months ended September 30, 2022, we issued $700.0 million aggregate principal amount of 3.85% Senior Notes due 2032.

Forward-Looking Statements

Our business, financial condition, results of operations, cash flows, and prospects, and the prevailing market price and performance of our common stock may be adversely affected by a number of factors, including the matters discussed below. Certain statements and information set forth in this Quarterly Report on Form 10-Q, including, without limitation, statements regarding our strategic acquisitions, initiatives, partnerships, or investments, including AutoNation USA, AutoNation Finance, and our mobile automotive repair and maintenance business; our investments in digital and online capabilities and mobility solutions; our expectations for the future performance of our business and the automotive retail industry; as well as other written or oral statements made from time to time by us or by our authorized executive officers on our behalf that describe our objectives, goals, or plans constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact, including statements that describe our objectives, plans or goals are, or may be deemed to be, forward-looking statements. Words such as “anticipate,” “expect,” “intend,” “goal,” “target,” “project,” “plan,” “believe,” “continue,” “may,” “will,” “could,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Our forward-looking statements reflect our current expectations concerning future results and events, and they involve known and unknown risks, uncertainties and other factors that are difficult to predict and may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these statements. These forward-looking statements speak only as of the date of this report, and we undertake no obligation to revise or update these statements to reflect subsequent events or circumstances. The risks, uncertainties, and other factors that our stockholders and prospective investors should consider include, but are not limited to, the following:

•The automotive retail industry is sensitive to changing economic conditions and various other factors, including, but not limited to, unemployment levels, consumer confidence, fuel prices, interest rates, and tariffs. Our business and results of operations are substantially dependent on new and used vehicle sales levels in the United States and in our particular geographic markets, as well as the gross profit margins that we can achieve on our sales of vehicles, all of which are very difficult to predict.

•Our new vehicle sales are impacted by the incentive, marketing, and other programs of vehicle manufacturers.

•We are dependent upon the success and continued financial viability of the vehicle manufacturers and distributors with which we hold franchises. On September 15, 2023, the United Auto Workers launched strikes against Ford, General Motors, and Stellantis. If the strikes continue for a prolonged period of time, it could adversely impact our business and results of operations.

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•We are subject to restrictions imposed by, and significant influence from, vehicle manufacturers that may adversely impact our business, financial condition, results of operations, cash flows, and prospects, including our ability to acquire additional stores.

•We are investing significantly in various strategic initiatives, including the planned expansion of our AutoNation USA stores, our AutoNation Finance business, and our mobile automotive repair and maintenance business, and if they are not successful, we will have incurred significant expenses without the benefit of improved financial results.

•If we are not able to maintain and enhance our retail brands and reputation or to attract consumers to our own digital channels, or if events occur that damage our retail brands, reputation, or sales channels, our business and financial results may be harmed.

•We are subject to various risks associated with originating and servicing auto finance loans through indirect lending to customers, any of which could have an adverse effect on our business.

•New laws, regulations, or governmental policies in response to climate change, including fuel economy and greenhouse gas emission standards, or changes to existing standards, could adversely impact our business, results of operations, financial condition, cash flow, and prospects.

•We are subject to numerous legal and administrative proceedings, which, if the outcomes are adverse to us, could materially adversely affect our business, results of operations, financial condition, cash flows, and prospects.

•Our operations are subject to extensive governmental laws and regulations. If we are found to be in purported violation of or subject to liabilities under any of these laws or regulations, or if new laws or regulations are enacted that adversely affect our operations, our business, operating results, and prospects could suffer.

•A failure of our information systems or any security breach or unauthorized disclosure of confidential information could have a material adverse effect on our business.

•Our debt agreements contain certain financial ratios and other restrictions on our ability to conduct our business, and our substantial indebtedness could adversely affect our financial condition and operations and prevent us from fulfilling our debt service obligations.

•We are subject to interest rate risk in connection with our vehicle floorplan payables, revolving credit facility, commercial paper program, and warehouse facilities that could have a material adverse effect on our profitability.

•Goodwill and other intangible assets comprise a significant portion of our total assets. We must test our goodwill and other intangible assets for impairment at least annually, which could result in a material, non-cash write-down of goodwill or franchise rights and could have a material adverse impact on our results of operations and shareholders’ equity.

•Our minority equity investments with readily determinable fair values are required to be measured at fair value each reporting period, which could adversely impact our results of operations and financial condition. The carrying value of our minority equity investment that does not have a readily determinable fair value is required to be adjusted for observable price changes or impairments, both of which could adversely impact our results of operations and financial condition.

•Our largest stockholders, as a result of their ownership stakes in us, may have the ability to exert substantial influence over actions to be taken or approved by our stockholders. In addition, future share repurchases and fluctuations in the levels of ownership of our largest stockholders could impact the volume of trading, liquidity, and market price of our common stock.

•Natural disasters and adverse weather events, including the effects of climate change, can disrupt our business.

Please refer to our most recent Annual Report on Form 10-K for additional discussion of the foregoing risks. These forward-looking statements speak only as of the date of this report, and we undertake no obligation to update any forward-looking statements to reflect subsequent events or circumstances.

Additional Information

Investors and others should note that we announce material financial information using our company website (www.autonation.com), our investor relations website (investors.autonation.com), SEC filings, press releases, public conference calls, and webcasts. Information about AutoNation, its business, and its results of operations may also be announced by posts on AutoNation’s Twitter feed, www.twitter.com/autonation.

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The information that we post on our websites and social media channels could be deemed to be material information. As a result, we encourage investors, the media, and others interested in AutoNation to review the information that we post on those websites and social media channels. Our social media channels may be updated from time to time on our investor relations website. The information on or accessible through our websites and social media channels is not incorporated by reference in this Quarterly Report on Form 10-Q.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We have market risk exposure on various instruments that are based on variable interest rates. Interest rate derivatives may be used to hedge a portion of our variable rate debt, when appropriate, based on market conditions.

We had $2.8 billion of variable rate vehicle floorplan payable at September 30, 2023, and $2.1 billion at December 31, 2022. Based on these amounts, a 100 basis point change in interest rates would result in an approximate change to our annual floorplan interest expense of $28.1 million at September 30, 2023, and $21.1 million at December 31, 2022. Our exposure to changes in interest rates with respect to total vehicle floorplan payable is partially mitigated by manufacturers’ floorplan assistance, which in some cases is based on variable interest rates.

We had $350.0 million of commercial paper notes outstanding at September 30, 2023, and $50.0 million at December 31, 2022. Based on the amount outstanding, a 100 basis point change in interest rates would result in an approximate change to our annual interest expense of $3.5 million at September 30, 2023, and $0.5 million at December 31, 2022.

Our fixed rate senior unsecured notes totaled $3.2 billion and had a fair value of $2.8 billion as of September 30, 2023, and totaled $3.2 billion and had a fair value of $2.8 billion as of December 31, 2022.

As of September 30, 2023, all auto loans receivable outstanding were fixed-rate installment contracts. Financing for these receivables was achieved through both variable- and fixed-rate non-recourse debt. Non-recourse debt includes warehouse facilities and asset-backed term securitizations. Borrowings under the warehouse facilities are variable-rate debt and are secured by the related auto loans receivable. Certain auto loans receivable were funded through term securitizations, which issued notes payable that accrue interest at fixed rates, and are also secured by the related auto loans receivable.

Equity Price Risk

We are subject to equity price risk with respect to minority equity investments. Certain of our equity investments have readily determinable fair values. During the period that we hold these equity investments, unrealized gains and losses will be recorded as the fair market value of the securities change over time. The fair value of these equity investments was $13.3 million at September 30, 2023. A hypothetical 10% change in the equity prices of these securities with readily determinable fair values would result in an approximate change to gain or loss of $1.3 million. We also have a minority equity investment without a readily determinable fair value. This equity investment is measured using a measurement alternative as permitted by accounting standards and was initially recorded at cost, to be subsequently adjusted for observable price changes. During the period that we hold this investment, unrealized gains and losses may be recorded if we identify observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The carrying amount of our equity investment without a readily determinable fair value was $56.7 million at September 30, 2023. A hypothetical 10% observable price change for this equity investment would result in an approximate change to gain or loss of $5.7 million. The selected 10% hypothetical change in equity prices is not intended to reflect a best or worst case scenario, as equity price changes could be smaller or larger due to the nature of equity markets.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q.

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Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) identified in connection with the evaluation required by paragraph (d) of Rule 13a-15 or 15d-15 under the Exchange Act that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1A. RISK FACTORS

In addition to the information set forth in this Form 10-Q, you should carefully consider the risk factors discussed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2022, which could materially affect our business, financial condition, or future results.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The table below sets forth information with respect to shares of common stock repurchased by AutoNation, Inc. during the three months ended September 30, 2023.


Period	Total Number of Shares Purchased (1)	Avg. Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares That May Yet Be Purchased Under The Plans or Programs (in millions)(1)
July 1, 2023 - July 31, 2023	729,113	$	154.20	729,113	$	559.5
August 1, 2023 - August 31, 2023	553,704	$	158.16	553,704	$	472.0
September 1, 2023 - September 30, 2023	—	$	—	—	$	472.0
Total	1,282,817			1,282,817

(1)Our Board of Directors from time to time authorizes the repurchase of shares of our common stock up to a certain monetary limit. As of October 25, 2023, $439.4 million remained available under our stock repurchase limit. Our stock repurchase program does not have an expiration date.

ITEM 5. OTHER INFORMATION

During the fiscal quarter ended September 30, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (in each case, as defined in Item 408 of Regulation S-K).

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ITEM 6. EXHIBITS


Exhibit No.			Description

3.1			Amended and Restated By-Laws of AutoNation, Inc. (inc orporated by reference to Exhibit 3.1 to the Qua rterly Report on Form 10-Q filed on July 21, 2023).
10.1†			Amended and Restated Credit Agreement, dated July 18, 2023, by and among AutoNation, Inc., JPMorgan Chase Bank, N.A., as Administrative Agent, and the other parties thereto (inc orporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed on July 21, 20 23).
10.2			Letter Agreement, dated September 12, 2023, by and between AutoNation, Inc. and Jeff Parent (incorporated by reference to Exhibi t 10.1 to the Current Report on Form 8-K filed on September 22, 2023).
10.3*			Amendment to Employment A greement, dated September 1 , 2023, by and between AutoNation, Inc. and Michael M anley.
31.1*			Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Exchange Act.
31.2*			Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) of the Exchange Act.
32.1**			Certification of Chief Executive Officer Pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350.
32.2**			Certification of Chief Financial Officer Pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350.
101*			Inline XBRL Document Set for the condensed consolidated financial statements and accompanying notes in Part I, Item 1, “Financial Statements” of this Quarterly Report on Form 10-Q.
104*			Inline XBRL for the cover page of this Quarterly Report on Form 10-Q, included in the Exhibit 101 Inline XBRL Document Set.

† Certain schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company undertakes to furnish copies of any of the omitted schedules to the SEC or its staff upon request.

* Filed herewith.

** Furnished herewith.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		AUTONATION, INC.

Date:	October 27, 2023	By:	/s/ Kimberly R. Dees
			Kimberly R. Dees Senior Vice President and Chief Accounting Officer

			(Duly Authorized Officer and Principal Accounting Officer)

Exhibit 10.3

AMENDMENT TO EMPLOYMENT AGREEMENT

This Amendment (this “Amendment”) is entered into as of September 1, 2023, and amends that certain Employment Agreement dated as of September 9, 2021 (the “Agreement”) by and between AutoNation, Inc. (together with its subsidiaries and affiliates, the “Company”), and Michael Manley (the “Executive”).

RECITALS

WHEREAS, the Company desires to amend the Agreement to reflect a change to the terms and conditions therein; and

WHEREAS, the Executive desires to continue to be employed by the Company on such terms and conditions.

TERMS OF AGREEMENT

In consideration of the mutual promises, covenants, and agreements contained herein, the sufficiency of which is acknowledged by the parties, and intending to be legally bound, the parties agree as follows:

1. Section 1(f) of the Agreement is hereby amended to add the following immediately after clause (ii) of the first sentence thereof: “and (iii) to use the Company’s corporate aircraft for personal travel for up to 70 hours per year (provided, that the value of such travel will be included in the Executive’s annual income subject to tax in accordance with the applicable regulations of the Internal Revenue Service and Company policy).”

2. Except as otherwise expressly provided herein, all of the terms and provisions of the Agreement shall remain in full force and effect and this Amendment shall not amend or modify any other rights, powers, duties, or obligations of any party to the Agreement.

3. This Amendment and the Agreement contain the entire agreement between the parties hereto with respect to the matters contained herein and supersedes and replaces any prior agreement between the parties with respect to the matters set forth in this Amendment.

4. This Amendment may be executed in counterparts, and each counterpart will have the same force and effect as an original and will constitute an effective, binding agreement on part of each of the undersigned.

IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first above written.


			AUTONATION, INC., a Delaware corporation

			/s/ Coleman Edmunds
			By: Coleman Edmunds, EVP, General Counsel & Assistant Secretary


			EXECUTIVE

			/s/ Michael Manley
			Michael Manley

Exhibit 31.1

CERTIFICATION

I, Mike Manley, certify that:

1.I have reviewed this quarterly report on Form 10-Q of AutoNation, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


/s/ Mike Manley
Mike Manley
Chief Executive Officer and Director

Date: October 27, 2023

Exhibit 31.2

CERTIFICATION

I, Thomas A. Szlosek, certify that:

1.I have reviewed this quarterly report on Form 10-Q of AutoNation, Inc.;

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


/s/ Thomas A. Szlosek
Thomas A. Szlosek
Executive Vice President and Chief Financial Officer

Date: October 27, 2023

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of AutoNation, Inc. (the “Company”) for the quarter ended September 30, 2023, as filed with the U.S. Securities and Exchange Commission (the “Report”), I, Mike Manley, Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Mike Manley
Mike Manley
Chief Executive Officer and Director

Date: October 27, 2023

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of AutoNation, Inc. (the “Company”) for the quarter ended September 30, 2023, as filed with the U.S. Securities and Exchange Commission (the “Report”), I, Thomas A. Szlosek, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Thomas A. Szlosek
Thomas A. Szlosek
Executive Vice President and Chief Financial Officer

Date: October 27, 2023

Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2023	Oct. 25, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	1-13107
Entity Registrant Name	AUTONATION, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	73-1105145
Entity Address, Address Line One	200 SW 1st Avenue
Entity Address, City or Town	Fort Lauderdale
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33301
City Area Code	954
Local Phone Number	769-6000
Title of 12(b) Security	Common stock, par value $0.01 per share
Trading Symbol	AN
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		42,520,469
Amendment Flag	false
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2023
Entity Central Index Key	0000350698
Current Fiscal Year End Date	--12-31

Unaudited Condensed Consolidated Balance Sheets - USD ($)
$ in Millions

Sep. 30, 2023

Dec. 31, 2022

ASSETS

Cash and cash equivalents

$ 64.0

$ 72.6

Receivables, net

877.3

858.8

Inventory

2,645.6

2,048.3

Other current assets

186.2

158.3

Total Current Assets

3,773.1

3,138.0

AUTO LOANS RECEIVABLE, net of allowance for credit losses of $47.9 million and $57.5 million, respectively

320.0

303.1

PROPERTY AND EQUIPMENT, net of accumulated depreciation of $2.1 billion and $1.9 billion, respectively

3,723.5

3,607.2

OPERATING LEASE ASSETS

371.0

323.5

GOODWILL

1,455.7

^[1]

1,320.1

OTHER INTANGIBLE ASSETS, NET

931.8

837.0

OTHER ASSETS

665.9

530.8

Total Assets

11,241.0

10,059.7

LIABILITIES AND SHAREHOLDERS’ EQUITY

Vehicle floorplan payable

2,814.8

2,109.3

Accounts payable

341.6

327.6

Commercial paper

350.0

50.0

Current maturities of long-term debt

12.8

12.6

Current portion of non-recourse debt

7.2

10.7

Accrued payroll and benefits

282.7

238.0

Other current liabilities

722.7

657.5

Total Current Liabilities

4,531.8

3,405.7

LONG-TERM DEBT, NET OF CURRENT MATURITIES

3,579.6

3,586.9

NON-RECOURSE DEBT, NET OF CURRENT PORTION

238.9

312.9

NONCURRENT OPERATING LEASE LIABILITIES

339.3

296.9

DEFERRED INCOME TAXES

60.4

76.5

OTHER LIABILITIES

349.0

333.0

COMMITMENTS AND CONTINGENCIES (Note 14)

SHAREHOLDERS’ EQUITY:

Common stock, par value $0.01 per share; 1,500,000,000 shares authorized; 63,562,149 shares issued at September 30, 2023, and December 31, 2022, including shares held in treasury

0.6

Additional paid-in capital

18.6

3.1

Retained earnings

4,426.8

3,663.7

Treasury stock, at cost; 20,790,347 and 15,915,358 shares held, respectively

(2,304.0)

(1,619.6)

Total Shareholders’ Equity

2,142.0

2,047.8

Total Liabilities and Shareholders’ Equity

11,241.0

10,059.7

Trade

LIABILITIES AND SHAREHOLDERS’ EQUITY

Vehicle floorplan payable

1,358.7

946.6

Non-Trade

LIABILITIES AND SHAREHOLDERS’ EQUITY

Vehicle floorplan payable

$ 1,456.1

$ 1,162.7

[1]	(1) The change in goodwill from the prior period is primarily due to the acquisition of the mobile repair and maintenance business we acquired in January 2023. Such goodwill is reflected in our Mobile Service reporting unit.

Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Billions	Sep. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
PROPERTY AND EQUIPMENT, accumulated depreciation	$ 2.1	$ 1.9
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock authorized (in shares)	1,500,000,000	1,500,000,000
Common stock issued (in shares)	63,562,149	63,562,149
Treasury stock (in shares)	20,790,347	15,915,358

Unaudited Condensed Consolidated Statements Of Income - USD ($)
shares in Millions, $ in Millions

3 Months Ended

9 Months Ended

Sep. 30, 2023

Sep. 30, 2022

Sep. 30, 2023

Sep. 30, 2022

TOTAL REVENUE

$ 6,892.7

$ 6,666.0

$ 20,181.5

$ 20,288.0

TOTAL COST OF SALES

5,598.1

5,353.2

16,265.2

16,304.6

TOTAL GROSS PROFIT

1,294.6

1,312.8

3,916.3

3,983.4

Selling, general, and administrative expenses

819.3

763.2

2,444.9

2,259.4

Depreciation and amortization

55.7

50.1

163.1

148.9

Other (income) expense, net

0.1

(23.0)

6.3

(24.5)

OPERATING INCOME

419.5

522.5

1,302.0

1,599.6

Non-operating income (expense) items:

Floorplan interest expense

(38.3)

(10.7)

(98.2)

(21.7)

Other interest expense

(48.8)

(33.7)

(135.9)

(97.4)

Other income (loss), net

(5.0)

(4.6)

4.6

(24.7)

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

327.4

473.5

1,072.5

1,455.8

Income tax provision

83.7

120.8

268.5

364.5

NET INCOME FROM CONTINUING OPERATIONS

243.7

352.7

804.0

1,091.3

Income (loss) from discontinued operations, net of income taxes

0.0

(0.1)

0.9

(0.3)

NET INCOME

$ 243.7

$ 352.6

$ 804.9

$ 1,091.0

BASIC EARNINGS (LOSS) PER SHARE:

Continuing operations (in dollars per share)

^[1]

$ 5.59

$ 6.35

$ 17.75

$ 18.65

Discontinued operations (in dollars per share)

^[1]

0.02

(0.01)

Net income (in dollars per share)

^[1]

$ 5.59

$ 6.35

$ 17.77

$ 18.65

Weighted average common shares outstanding (in shares)

43.6

55.5

45.3

58.5

DILUTED EARNINGS (LOSS) PER SHARE:

Continuing operations (in dollars per share)

^[1]

$ 5.54

$ 6.31

$ 17.63

$ 18.53

Discontinued operations (in dollars per share)

^[1]

0.02

(0.01)

Net income (in dollars per share)

^[1]

$ 5.54

$ 6.31

$ 17.65

$ 18.52

Weighted average common shares outstanding (in shares)

44.0

55.9

45.6

58.9

COMMON SHARES OUTSTANDING, net of treasury stock, at period end (in shares)

42.8

52.3

42.8

52.3

New vehicle

TOTAL REVENUE

$ 3,187.6

$ 2,863.9

$ 9,400.5

$ 8,606.9

TOTAL COST OF SALES

2,936.9

2,534.2

8,575.2

7,578.7

TOTAL GROSS PROFIT

250.7

329.7

825.3

1,028.2

Used vehicle

TOTAL REVENUE

2,172.1

2,401.7

6,292.7

7,494.5

TOTAL COST OF SALES

2,044.3

2,259.7

5,876.2

7,059.4

TOTAL GROSS PROFIT

127.8

142.0

416.5

435.1

Parts and service

TOTAL REVENUE

1,157.4

1,032.1

3,392.5

3,072.3

TOTAL COST OF SALES

611.6

553.5

1,793.1

1,650.9

TOTAL GROSS PROFIT

545.8

478.6

1,599.4

1,421.4

Finance and insurance, net

TOTAL REVENUE

369.5

360.7

1,071.4

1,092.2

TOTAL GROSS PROFIT

369.5

360.7

1,071.4

1,092.2

Other

TOTAL REVENUE

6.1

7.6

24.4

22.1

TOTAL COST OF SALES

5.3

5.8

20.7

15.6

TOTAL GROSS PROFIT

$ 0.8

$ 1.8

$ 3.7

$ 6.5

[1]	(1) EPS amounts are calculated discretely and, therefore, may not add up to the total due to rounding.

Unaudited Condensed Consolidated Statement Of Shareholders' Equity - USD ($) $ in Millions	Total	Common Stock	Additional Paid-In Capital	Retained Earnings	Treasury Stock
BALANCE at period start (in shares) at Dec. 31, 2021		86,562,149
BALANCE at period start at Dec. 31, 2021	$ 2,377.0	$ 0.8	$ 3.2	$ 4,639.9	$ (2,266.9)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	362.1			362.1
Repurchases of common stock, including excise tax	(380.9)				(380.9)
Stock-based compensation expense	15.9		15.9
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	(28.5)		(16.7)	(58.1)	46.3
BALANCE at period end (in shares) at Mar. 31, 2022		86,562,149
BALANCE at period end at Mar. 31, 2022	2,345.6	$ 0.8	2.4	4,943.9	(2,601.5)
BALANCE at period start (in shares) at Dec. 31, 2021		86,562,149
BALANCE at period start at Dec. 31, 2021	2,377.0	$ 0.8	3.2	4,639.9	(2,266.9)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	1,091.0
BALANCE at period end (in shares) at Sep. 30, 2022		86,562,149
BALANCE at period end at Sep. 30, 2022	2,255.2	$ 0.8	9.3	5,672.8	(3,427.7)
BALANCE at period start (in shares) at Mar. 31, 2022		86,562,149
BALANCE at period start at Mar. 31, 2022	2,345.6	$ 0.8	2.4	4,943.9	(2,601.5)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	376.3			376.3
Repurchases of common stock, including excise tax	(403.9)				(403.9)
Stock-based compensation expense	5.3		5.3
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	1.7		(2.5)		4.2
BALANCE at period end (in shares) at Jun. 30, 2022		86,562,149
BALANCE at period end at Jun. 30, 2022	2,325.0	$ 0.8	5.2	5,320.2	(3,001.2)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	352.6			352.6
Repurchases of common stock, including excise tax	(428.2)				(428.2)
Stock-based compensation expense	5.1		5.1
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	0.7		(1.0)		1.7
BALANCE at period end (in shares) at Sep. 30, 2022		86,562,149
BALANCE at period end at Sep. 30, 2022	2,255.2	$ 0.8	9.3	5,672.8	(3,427.7)
BALANCE at period start (in shares) at Dec. 31, 2022		63,562,149
BALANCE at period start at Dec. 31, 2022	2,047.8	$ 0.6	3.1	3,663.7	(1,619.6)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	288.7			288.7
Repurchases of common stock, including excise tax	(307.5)				(307.5)
Stock-based compensation expense	15.1		15.1
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	(23.8)		(15.2)	(41.8)	33.2
BALANCE at period end (in shares) at Mar. 31, 2023		63,562,149
BALANCE at period end at Mar. 31, 2023	2,020.3	$ 0.6	3.0	3,910.6	(1,893.9)
BALANCE at period start (in shares) at Dec. 31, 2022		63,562,149
BALANCE at period start at Dec. 31, 2022	2,047.8	$ 0.6	3.1	3,663.7	(1,619.6)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	804.9
BALANCE at period end (in shares) at Sep. 30, 2023		63,562,149
BALANCE at period end at Sep. 30, 2023	2,142.0	$ 0.6	18.6	4,426.8	(2,304.0)
BALANCE at period start (in shares) at Mar. 31, 2023		63,562,149
BALANCE at period start at Mar. 31, 2023	2,020.3	$ 0.6	3.0	3,910.6	(1,893.9)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	272.5			272.5
Repurchases of common stock, including excise tax	(209.5)				(209.5)
Stock-based compensation expense	8.3		8.3
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	0.2		(0.3)		0.5
BALANCE at period end (in shares) at Jun. 30, 2023		63,562,149
BALANCE at period end at Jun. 30, 2023	2,091.8	$ 0.6	11.0	4,183.1	(2,102.9)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	243.7			243.7
Repurchases of common stock, including excise tax	(202.0)				(202.0)
Stock-based compensation expense	8.2		8.2
Shares awarded under stock-based compensation plans, net of shares withheld for taxes	0.3		(0.6)		0.9
BALANCE at period end (in shares) at Sep. 30, 2023		63,562,149
BALANCE at period end at Sep. 30, 2023	$ 2,142.0	$ 0.6	$ 18.6	$ 4,426.8	$ (2,304.0)

Unaudited Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Net income	$ 804.9	$ 1,091.0
Adjustments to reconcile net income to net cash provided by operating activities:
(Income) loss from discontinued operations	(0.9)	0.3
Depreciation and amortization	163.1	148.9
Amortization of debt issuance costs and accretion of debt discounts	7.0	4.5
Stock-based compensation expense	31.6	26.3
Provision for credit losses on auto loans receivable	36.0	0.0
Deferred income tax provision	5.1	5.5
Net gain related to business/property dispositions	(1.1)	(17.1)
(Gain) loss on corporate-owned life insurance asset	(4.9)	26.0
Gain on sale of auto loans receivable	(8.1)	0.0
Other	6.2	1.1
(Increase) decrease, net of effects from business acquisitions and divestitures:
Receivables	(15.1)	80.3
Auto loans receivable, net	(112.7)	0.0
Inventory	(563.0)	(9.1)
Other assets	(108.2)	(28.6)
Increase (decrease), net of effects from business acquisitions and divestitures:
Vehicle floorplan payable - trade	412.0	124.0
Accounts payable	6.4	(52.2)
Other liabilities	104.6	42.7
Net cash provided by continuing operations	762.9	1,443.6
Net cash used in discontinued operations	(0.3)	(0.3)
Net cash provided by operating activities	762.6	1,443.3
CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES:
Purchases of property and equipment	(286.0)	(236.2)
Proceeds from the disposal of assets held for sale	2.5	22.8
Cash received from business divestitures, net of cash relinquished	0.0	55.2
Cash used in business acquisitions, net of cash acquired	(271.1)	0.0
Originations of auto loans receivable acquired through third-party dealers	(110.9)	0.0
Collections on auto loans receivable acquired through third-party dealers	110.1	0.0
Proceeds from the sale of auto loans receivable	68.7	0.0
Deposits for investment	0.0	(81.6)
Other	(10.3)	(7.5)
Net cash used in continuing operations	(497.0)	(247.3)
Net cash used in discontinued operations	0.0	0.0
Net cash used in investing activities	(497.0)	(247.3)
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES:
Repurchases of common stock	(723.2)	(1,177.4)
Proceeds from 3.85% Senior Notes due 2032	0.0	698.8
Net proceeds from (payments of) commercial paper	300.0	(340.0)
Proceeds from non-recourse debt	151.6	0.0
Payments of non-recourse debt	(232.1)	0.0
Payment of debt issuance costs	(6.6)	(6.6)
Net proceeds from vehicle floorplan payable - non-trade	260.4	46.4
Payments of other debt obligations	(9.4)	(8.7)
Proceeds from the exercise of stock options	1.9	3.4
Payments of tax withholdings for stock-based awards	(25.2)	(29.5)
Net cash used in continuing operations	(282.6)	(813.6)
Net cash used in discontinued operations	0.0	0.0
Net cash used in financing activities	(282.6)	(813.6)
INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	(17.0)	382.4
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH at beginning of period	95.4	60.6
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH at end of period	$ 78.4	$ 443.0

Unaudited Condensed Consolidated Statements Of Cash Flows (Parenthetical)	Sep. 30, 2023
3.85% Senior Notes Due 2032 \| Senior Notes
Percentage interest on debt instrument	3.85%

Interim Financial Statements	9 Months Ended
Interim Financial Statements	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Interim Financial Statements	INTERIM FINANCIAL STATEMENTS Business and Basis of Presentation AutoNation, Inc., through its subsidiaries, is one of the largest automotive retailers in the United States. As of September 30, 2023, we owned and operated 354 new vehicle franchises from 253 stores located in the United States, predominantly in major metropolitan markets in the Sunbelt region. Our stores, which we believe include some of the most recognizable and well-known in our key markets, sell 34 different new vehicle brands. The core brands of new vehicles that we sell, representing approximately 88% of the new vehicles that we sold during the nine months ended September 30, 2023, are manufactured by Toyota (including Lexus), Honda, Ford, General Motors, BMW, Mercedes-Benz, Stellantis, and Volkswagen (including Audi and Porsche). As of September 30, 2023, we also owned and operated 53 AutoNation-branded collision centers, 17 AutoNation USA used vehicle stores, 4 AutoNation-branded automotive auction operations, 3 parts distribution centers, a mobile automotive repair and maintenance business, and an auto finance company. We offer a diversified range of automotive products and services, including new vehicles, used vehicles, “parts and service” (also referred to as “After-Sales”), which includes automotive repair and maintenance services as well as wholesale parts and collision businesses, and automotive “finance and insurance” products (also referred to as “Customer Financial Services”), which include vehicle service and other protection products, as well as the arranging of financing for vehicle purchases through third-party finance sources. We also offer indirect financing on certain vehicles we sell through our captive finance company. For convenience, the terms “AutoNation,” “Company,” and “we” are used to refer collectively to AutoNation, Inc. and its subsidiaries, unless otherwise required by the context. Our store and other operations are conducted by our subsidiaries. The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of AutoNation, Inc. and its subsidiaries; intercompany accounts and transactions have been eliminated. The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. Additionally, operating results for interim periods are not necessarily indicative of the results that can be expected for a full year. The Unaudited Condensed Consolidated Financial Statements herein should be read in conjunction with our audited Consolidated Financial Statements and notes thereto included within our most recent Annual Report on Form 10-K. These Unaudited Condensed Consolidated Financial Statements reflect, in the opinion of management, all material adjustments (which include only normal recurring adjustments) necessary to fairly state, in all material respects, our financial position and results of operations for the periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. In preparing these financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements. We base our estimates and judgments on historical experience and other assumptions that we believe are reasonable. However, application of these accounting policies involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ materially from these estimates. We periodically evaluate estimates and assumptions used in the preparation of the financial statements and make changes on a prospective basis when adjustments are necessary. Such estimates and assumptions affect, among other things, our goodwill, indefinite-lived intangible asset, and long-lived asset valuations; inventory valuation; equity investment valuation; assets held for sale; assessments of variable consideration and related constraints related to retrospective commissions; accruals for chargebacks against revenue recognized from the sale of finance and insurance products; accruals related to self-insurance programs; certain legal proceedings; assessment of the annual income tax expense; valuation of deferred income taxes and income tax contingencies; the allowance for expected credit losses; and measurement of performance-based compensation costs.

Revenue Recognition

9 Months Ended

Sep. 30, 2023

Revenue Recognition [Abstract]

Revenue Recognition

REVENUE RECOGNITION

Disaggregation of Revenue


	Three Months Ended September 30, 2023
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	916.1	$	1,042.5	$	1,229.0	$	—	$	3,187.6
Used vehicle	649.1		602.4		773.1		147.5		2,172.1
Parts and service	301.7		299.6		402.4		153.7		1,157.4
Finance and insurance, net	115.6		129.1		111.5		13.3		369.5
Other	1.4		3.6		0.1		1.0		6.1
	$	1,983.9	$	2,077.2	$	2,516.1	$	315.5	$	6,892.7

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	1,765.2	$	1,841.7	$	2,175.5	$	211.3	$	5,993.7
Goods and services transferred over time(2)	218.7		235.5		340.6		104.2		899.0
	$	1,983.9	$	2,077.2	$	2,516.1	$	315.5	$	6,892.7


	Three Months Ended September 30, 2022
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	875.0	$	814.1	$	1,174.8	$	—	$	2,863.9
Used vehicle	764.3		667.4		853.0		117.0		2,401.7
Parts and service	275.8		266.2		364.5		125.6		1,032.1
Finance and insurance, net	117.1		123.1		112.5		8.0		360.7
Other	0.6		4.4		1.6		1.0		7.6
	$	2,032.8	$	1,875.2	$	2,506.4	$	251.6	$	6,666.0

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	1,839.4	$	1,673.0	$	2,199.8	$	169.9	$	5,882.1
Goods and services transferred over time(2)	193.4		202.2		306.6		81.7		783.9
	$	2,032.8	$	1,875.2	$	2,506.4	$	251.6	$	6,666.0


	Nine Months Ended September 30, 2023
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	2,667.1	$	2,910.1	$	3,823.3	$	—	$	9,400.5
Used vehicle	1,880.4		1,707.7		2,275.8		428.8		6,292.7
Parts and service	888.0		859.3		1,188.9		456.3		3,392.5
Finance and insurance, net	332.2		369.5		332.3		37.4		1,071.4
Other	2.8		17.6		1.2		2.8		24.4
	$	5,770.5	$	5,864.2	$	7,621.5	$	925.3	$	20,181.5

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	5,134.6	$	5,200.1	$	6,613.1	$	616.7	$	17,564.5
Goods and services transferred over time(2)	635.9		664.1		1,008.4		308.6		2,617.0
	$	5,770.5	$	5,864.2	$	7,621.5	$	925.3	$	20,181.5


	Nine Months Ended September 30, 2022
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	2,555.6	$	2,548.1	$	3,503.2	$	—	$	8,606.9
Used vehicle	2,374.2		2,074.6		2,673.7		372.0		7,494.5
Parts and service	820.0		788.0		1,083.4		380.9		3,072.3
Finance and insurance, net	355.7		375.2		338.1		23.2		1,092.2
Other	2.6		13.1		3.3		3.1		22.1
	$	6,108.1	$	5,799.0	$	7,601.7	$	779.2	$	20,288.0

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	5,538.8	$	5,205.8	$	6,697.5	$	536.0	$	17,978.1
Goods and services transferred over time(2)	569.3		593.2		904.2		243.2		2,309.9
	$	6,108.1	$	5,799.0	$	7,601.7	$	779.2	$	20,288.0

(2) Represents revenue recognized during the period for automotive repair and maintenance services.

Transaction Price Allocated to Remaining Performance Obligations


	Revenue Expected to Be Recognized by Period
	Total		Next 12 Months		13 - 36 Months		37 - 60 Months
Revenue expected to be recognized on VCP contracts sold as of period end	$	106.2	$	36.2	$	51.6	$	18.4

Contract Assets and Liabilities

The following table provides the balances of our receivables from contracts with customers and our current and long-term contract assets and contract liabilities:


	September 30, 2023		December 31, 2022
Receivables from contracts with customers, net	$	629.1	$	634.5
Contract Asset (Current)	$	22.5	$	27.7
Contract Asset (Long-Term)	$	3.4	$	8.6
Contract Liability (Current)	$	41.9	$	41.8
Contract Liability (Long-Term)	$	70.0	$	66.6


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amounts included in contract liability at the beginning of the period	$	8.5	$	8.1	$	26.9	$	25.9
Performance obligations satisfied in previous periods	$	4.1	$	(0.9)	$	1.5	$	3.8

Earnings Per Share

9 Months Ended

Sep. 30, 2023

Earnings Per Share [Abstract]

Earnings Per Share

EARNINGS PER SHARE

The following table presents the calculation of basic and diluted EPS:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Net income from continuing operations	$	243.7	$	352.7	$	804.0	$	1,091.3
Income (loss) from discontinued operations, net of income taxes	—		(0.1)		0.9		(0.3)
Net income	$	243.7	$	352.6	$	804.9	$	1,091.0

Basic weighted average common shares outstanding	43.6		55.5		45.3		58.5
Dilutive effect of unvested RSUs and stock options	0.4		0.4		0.3		0.4
Diluted weighted average common shares outstanding	44.0		55.9		45.6		58.9

Basic EPS amounts(1):
Continuing operations	$	5.59	$	6.35	$	17.75	$	18.65
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.59	$	6.35	$	17.77	$	18.65

Diluted EPS amounts(1):
Continuing operations	$	5.54	$	6.31	$	17.63	$	18.53
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.54	$	6.31	$	17.65	$	18.52

(1) EPS amounts are calculated discretely and, therefore, may not add up to the total due to rounding.

A summary of anti-dilutive equity instruments excluded from the computation of diluted EPS is as follows:


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2023	2022	2023	2022
Anti-dilutive equity instruments excluded from the computation of diluted EPS	—	0.1	—	0.1

Receivables, Net

9 Months Ended

Sep. 30, 2023

Receivables [Abstract]

Receivables, Net

RECEIVABLES, NET

The components of receivables, net of allowances for expected credit losses, are as follows:


	September 30, 2023		December 31, 2022
Contracts-in-transit and vehicle receivables	$	408.0	$	441.1
Trade receivables	172.4		156.6
Manufacturer receivables	212.3		174.4
Income taxes receivable (see Note 9)	24.8		20.2
Other	61.8		68.2
	879.3		860.5
Less: allowances for expected credit losses	(2.0)		(1.7)
Receivables, net	$	877.3	$	858.8

Auto Loans Receivable

9 Months Ended

Sep. 30, 2023

Receivables [Abstract]

Auto Loans Receivable

AUTO LOANS RECEIVABLE

Auto Loans Receivable, Net

The components of auto loans receivable, net of unearned discounts and allowances for expected credit losses, at September 30, 2023, and December 31, 2022, are as follows:


	September 30, 2023		December 31, 2022




Total auto loans receivable	$	373.6	$	377.0
Accrued interest and fees	4.1		4.4
Deferred loan origination costs	0.7		0.5
Less: unearned discounts	(10.5)		(21.3)
Less: allowances for expected credit losses	(47.9)		(57.5)
Auto loans receivable, net	$	320.0	$	303.1

Credit Quality

Auto Loans Receivable by Major Credit Program

The following tables present auto loans receivable as of September 30, 2023, and December 31, 2022, disaggregated by major credit program tier:



	Fiscal Year of Origination
As of September 30, 2023	2023		2022		2021		2020		2019		Prior to 2019		Total
Credit Program Tier(1):
Platinum	$	70.4	$	16.5	$	9.2	$	4.0	$	4.0	$	0.7	$	104.8
Gold	52.8		39.8		21.0		8.2		5.8		1.2		128.8
Silver	50.4		37.4		19.2		6.3		3.9		0.6		117.8
Bronze	6.2		1.4		7.3		1.9		0.1		0.1		17.0
Copper	0.4		0.4		3.5		0.7		0.1		0.1		5.2
Total auto loans receivable	$	180.2	$	95.5	$	60.2	$	21.1	$	13.9	$	2.7	$	373.6

Current-period gross write-offs	$	4.5	$	27.3	$	12.5	$	3.7	$	2.1	$	0.6	$	50.7

	Fiscal Year of Origination
As of December 31, 2022	2022		2021		2020		2019		2018		Prior to 2018		Total
Credit Program Tier(1):
Platinum	$	21.9	$	12.9	$	6.4	$	7.4	$	2.2	$	0.2	$	51.0
Gold	53.7		30.0		12.9		10.6		3.2		0.4		110.8
Silver	61.9		29.8		10.4		8.0		1.9		0.1		112.1
Bronze	41.4		17.1		7.4		3.7		1.0		0.1		70.7
Copper	19.2		8.0		2.6		1.8		0.7		0.1		32.4
Total auto loans receivable	$	198.1	$	97.8	$	39.7	$	31.5	$	9.0	$	0.9	$	377.0

(1) Classified based on credit grade assigned when customer was initially approved for financing.

Allowance for Credit Losses

Rollforward of Allowance for Credit Losses

The following is a rollforward of our allowance for expected credit losses for auto loans receivable for the nine months ended September 30, 2023:


	Nine Months Ended
	September 30, 2023
Balance as of beginning of year	$	57.5
Provision for credit losses	36.0

Write-offs	(50.7)
Recoveries(1)	21.2
Sold loans	(16.1)
Balance as of September 30, 2023	$	47.9

(1) Includes proceeds from the recovery of vehicle collateral, net of costs incurred.

Past Due Auto Loans Receivable


	Age Analysis of Past-Due Auto Loans Receivable as of
	September 30, 2023		December 31, 2022
31-60 Days	$	18.6	$	13.0
61-90 Days	5.5		4.1
Greater than 90 Days	3.7		2.6
Total Past Due	$	27.8	$	19.7

Current	345.8		357.3
Total	$	373.6	$	377.0

Inventory And Vehicle Floorplan Payable

9 Months Ended

Sep. 30, 2023

Inventory And Vehicle Floorplan Payable [Abstract]

Inventory And Vehicle Floorplan Payable

INVENTORY AND VEHICLE FLOORPLAN PAYABLE

The components of inventory are as follows:


	September 30, 2023		December 31, 2022
New vehicles	$	1,578.7	$	1,009.7
Used vehicles	801.0		789.1
Parts, accessories, and other	265.9		249.5
Inventory	$	2,645.6	$	2,048.3

The components of vehicle floorplan payable are as follows:


	September 30, 2023		December 31, 2022
Vehicle floorplan payable - trade	$	1,358.7	$	946.6
Vehicle floorplan payable - non-trade	1,456.1		1,162.7
Vehicle floorplan payable	$	2,814.8	$	2,109.3

Goodwill And Intangible Assets, Net

9 Months Ended

Sep. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill And Intangible Assets, Net

GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill and intangible assets, net, consist of the following:


	September 30, 2023		December 31, 2022
Goodwill (1)	$	1,455.7	$	1,320.1

Franchise rights - indefinite-lived	$	876.2	$	816.2
Other intangibles	70.7		30.7
	946.9		846.9
Less: accumulated amortization	(15.1)		(9.9)
Other intangible assets, net	$	931.8	$	837.0

Goodwill and our franchise rights assets are tested for impairment annually as of April 30 or more frequently when events or changes in circumstances indicate that impairment may exist.

See Note 13 of the Notes to Unaudited Condensed Consolidated Financial Statements for information about our annual impairment tests of goodwill and franchise rights.

Debt

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Debt

DEBT

Non-Vehicle Long-Term Debt

Non-vehicle long-term debt consisted of the following:


Debt Description	Maturity Date	Interest Payable	September 30, 2023		December 31, 2022
3.5% Senior Notes	November 15, 2024	May 15 and November 15	$	450.0	$	450.0
4.5% Senior Notes	October 1, 2025	April 1 and October 1	450.0		450.0
3.8% Senior Notes	November 15, 2027	May 15 and November 15	300.0		300.0
1.95% Senior Notes	August 1, 2028	February 1 and August 1	400.0		400.0
4.75% Senior Notes	June 1, 2030	June 1 and December 1	500.0		500.0
2.4% Senior Notes	August 1, 2031	February 1 and August 1	450.0		450.0
3.85% Senior Notes	March 1, 2032	March 1 and September 1	700.0		700.0
Revolving credit facility	July 18, 2028	Monthly	—		—
Finance leases and other debt	Various dates through 2041		365.3		375.5
			3,615.3		3,625.5
Less: unamortized debt discounts and debt issuance costs			(22.9)		(26.0)
Less: current maturities			(12.8)		(12.6)
Long-term debt, net of current maturities			$	3,579.6	$	3,586.9

Debt Refinancing Transaction

Senior Unsecured Notes and Credit Agreement

guarantees would be full and unconditional and joint and several, and any subsidiaries other than the guarantor subsidiaries would be minor.

Other Long-Term Debt

At September 30, 2023, we had finance leases and other debt obligations of $365.3 million, which are due at various dates through 2041.

Commercial Paper

Non-Recourse Debt

Non-recourse debt outstanding at September 30, 2023, and December 31, 2022, consisted of the following:


	September 30, 2023		December 31, 2022
Warehouse facilities	$	189.0	$	181.8
Term securitization debt of consolidated VIEs	59.2		146.9
	248.2		328.7
Less: unamortized debt discounts and debt issuance costs	(2.1)		(5.1)
Less: current maturities	(7.2)		(10.7)
Non-recourse debt, net of current maturities	$	238.9	$	312.9

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Income Taxes	INCOME TAXES Income taxes receivable included in Receivables, net totaled $24.8 million at September 30, 2023 and $20.2 million at December 31, 2022. We file income tax returns in the U.S. federal jurisdiction and various states. As a matter of course, various taxing authorities, including the IRS, regularly audit us. These audits may culminate in proposed assessments which may ultimately result in our owing additional taxes. With few exceptions, we are no longer subject to U.S. federal, state, and local income tax examinations by tax authorities for years before 2018. Currently, no tax years are under examination by the IRS, and tax years from 2019 to 2021 are under examination by U.S. state jurisdictions. We believe that our tax positions comply with applicable tax law and that we have adequately provided for these matters. It is our policy to account for interest and penalties associated with income tax obligations as a component of Income Tax Provision in the accompanying Unaudited Condensed Consolidated Statements of Income.

Shareholders' Equity

9 Months Ended

Sep. 30, 2023

Stockholders' Equity Note [Abstract]

Shareholders' Equity

SHAREHOLDERS’ EQUITY

A summary of shares repurchased under our stock repurchase program authorized by our Board of Directors follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Shares repurchased	1.3		3.8		5.3		10.9
Aggregate purchase price (1)	$	200.0	$	428.2	$	712.4	$	1,213.1
Average purchase price per share	$	155.91	$	113.51	$	135.38	$	110.96

(1) Excludes excise tax accrual imposed under the Inflation Reduction Act of $2.0 million and $6.6 million for the three and nine months ended September 30, 2023, respectively.

As of September 30, 2023, $472.0 million remained available under our stock repurchase limit most recently authorized by our Board of Directors.

A summary of shares of common stock issued in connection with the exercise of stock options follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Shares issued (in actual number of shares)	7,000		16,570		37,996		71,030
Proceeds from the exercise of stock options	$	0.4	$	0.8	$	1.9	$	3.4
Average exercise price per share	$	57.15	$	48.15	$	50.34	$	47.94


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(In actual number of shares)	2023	2022	2023	2022
Shares issued	987	1,227	531,994	775,312
Shares surrendered to AutoNation to satisfy tax withholding obligations	278	570	182,527	263,521

Acquisitions and Divestitures	9 Months Ended
Acquisitions and Divestitures	Sep. 30, 2023
Business Combination and Asset Acquisition [Abstract]
Acquisitions and Divestitures	ACQUISITIONS AND DIVESTITURES During the nine months ended September 30, 2023, we acquired RepairSmith, a mobile solution for automotive repair and maintenance, and we also purchased seven stores. Acquisitions are included in the Unaudited Condensed Consolidated Financial Statements from the date of acquisition. The purchase price allocations for these business combinations are preliminary and subject to final adjustments, primarily related to the valuation of working capital, deferred tax assets and liabilities, and residual goodwill. We did not purchase any stores during the nine months ended September 30, 2022. The acquisitions that occurred during the nine months ended September 30, 2023, were not material to our financial condition or results of operations. Additionally, on a pro forma basis as if the results of these acquisitions had been included in our consolidated results for the entire nine month periods ended September 30, 2023 and 2022, revenue and net income would not have been materially different from our reported revenue and net income for these periods. We did not divest any stores during the nine months ended September 30, 2023. We divested three stores during the nine months ended September 30, 2022. We recognized net gains related to divestitures of $16.1 million during the nine months ended September 30, 2022, which are included in Other Income, Net (within Operating Income) in our Consolidated Statement of Operations. The financial condition and results of operations of these businesses were not material to our consolidated financial statements.

Cash Flow Information

9 Months Ended

Sep. 30, 2023

Supplemental Cash Flow Information [Abstract]

Cash Flow Information

CASH FLOW INFORMATION

Cash, Cash Equivalents, and Restricted Cash


	September 30, 2023		December 31, 2022
Cash and cash equivalents	$	64.0	$	72.6
Restricted cash included in Other Current Assets	12.6		15.6
Restricted cash included in Other Assets	1.8		7.2
Total cash, cash equivalents, and restricted cash	$	78.4	$	95.4

Non-Cash Investing and Financing Activities

We had accrued purchases of property and equipment of $33.5 million at September 30, 2023, and $29.7 million at September 30, 2022.


	Nine Months Ended
	September 30,
	2023		2022
Supplemental noncash information on adjustments to right-of-use assets, including right-of-use assets obtained in exchange for new:
Operating lease liabilities	$	78.6	$	53.2
Finance lease liabilities	$	40.3	$	20.2

Interest and Income Taxes Paid

Financial Instruments And Fair Value Measurements

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Financial Instruments and Fair Value Measurements

FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTSThe fair value of a financial instrument represents the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of judgment, and therefore cannot be determined with precision.


Level 1			Quoted prices (unadjusted) in active markets for identical assets or liabilities that a reporting entity can access at the measurement date

Level 2			Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly

Level 3			Unobservable inputs

The following methods and assumptions were used by us in estimating fair value disclosures for financial instruments:

•Auto loans receivable, net: Auto loans receivable are presented net of an allowance for expected credit losses, which we believe approximates fair value.


	Nine Months Ended
	September 30,
	2023		2022
Net losses recognized during the period on equity securities	$	(2.3)	$	(0.1)
Less: Net losses recognized during the period on equity securities sold during the period	—		—
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date	$	(2.3)	$	(0.1)


	September 30, 2023		December 31, 2022
Carrying value	$	3,227.1	$	3,224.0
Fair value	$	2,817.8	$	2,803.6

The following table presents assets measured and recorded at fair value on a nonrecurring basis during the nine months ended September 30, 2023 and 2022:


	2023				2022
Description	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)		Gain/(Loss)		Fair Value Measurements Using Significant Unobservable Inputs (Level 3)		Gain/(Loss)



Long-lived assets held and used	$	—	$	(2.7)	$	—	$	(1.0)

Goodwill and Other Intangible Assets

Long-Lived Assets and Right-of-Use Assets

Commitments And Contingencies	9 Months Ended
Commitments And Contingencies	Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments And Contingencies	COMMITMENTS AND CONTINGENCIES Legal Proceedings We are involved, and will continue to be involved, in numerous legal proceedings arising out of the conduct of our business, including litigation with customers, third-party dealers, wage and hour and other employment-related lawsuits, and actions brought by governmental authorities. Some of these lawsuits purport or may be determined to be class or collective actions and seek substantial damages or injunctive relief, or both, and some may remain unresolved for several years. We establish accruals for specific legal proceedings when it is considered probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Our accruals for loss contingencies are reviewed quarterly and adjusted as additional information becomes available. We disclose the amount accrued if material or if such disclosure is necessary for our financial statements to not be misleading. If a loss is not both probable and reasonably estimable, or if an exposure to loss exists in excess of the amount accrued, we assess whether there is at least a reasonable possibility that a loss, or additional loss, may have been incurred. If there is a reasonable possibility that a loss, or additional loss, may have been incurred, we disclose the estimate of the possible loss or range of loss if it is material or a statement that such an estimate cannot be made. Our evaluation of whether a loss is reasonably possible or probable is based on our assessment and consultation with legal counsel regarding the ultimate outcome of the matter. As of September 30, 2023 and 2022, we have accrued for the potential impact of loss contingencies that are probable and reasonably estimable, and there was no indication of a reasonable possibility that a material loss, or additional material loss, may have been incurred. We do not believe that the ultimate resolution of these matters will have a material adverse effect on our results of operations, financial condition, or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on our results of operations, financial condition, or cash flows. Other Matters AutoNation, acting through its subsidiaries, is the lessee under many real estate leases that provide for the use by our subsidiaries of their respective store premises. Pursuant to these leases, we agree to indemnify the lessor and other related parties from certain liabilities arising as a result of the use of the leased premises, including environmental liabilities, or a breach of the lease by the lessee. Additionally, from time to time, we enter into agreements with third parties in connection with the sale of assets or businesses in which we agree to indemnify the purchaser or related parties from certain liabilities or costs arising in connection with the assets or business. Also, in the ordinary course of business in connection with purchases or sales of goods and services, we enter into agreements that may contain indemnification provisions. In the event that an indemnification claim is asserted, our liability would be limited by the terms of the applicable agreement. From time to time, primarily in connection with dispositions of automotive stores, we assign or sublet to the store purchaser our interests in any real property leases associated with such stores. In general, we retain responsibility for the performance of certain obligations under such leases to the extent that the assignee or sublessee does not perform, whether such performance is required prior to or following the assignment or subletting of the lease. Additionally, we generally remain subject to the terms of any guarantees made by us in connection with such leases. We generally have indemnification rights against the assignee or sublessee in the event of non-performance under these leases, as well as certain defenses. We presently have no reason to believe that we will be called on to perform under any such remaining assigned leases or subleases. We estimate that lessee rental payment obligations during the remaining terms of these leases with expirations ranging from 2024 to 2034 are approximately $5 million at September 30, 2023. There can be no assurance that any performance required of us under these leases would not have a material adverse effect on our business, financial condition, and cash flows. At September 30, 2023, surety bonds, letters of credit, and cash deposits totaled $111.5 million, of which $0.8 million were letters of credit. In the ordinary course of business, we are required to post performance and surety bonds, letters of credit, and/or cash deposits as financial guarantees of our performance. We do not currently provide cash collateral for outstanding letters of credit.In the ordinary course of business, we are subject to numerous laws and regulations, including automotive, environmental, health and safety, and other laws and regulations. We do not anticipate that the costs of compliance with such laws will have a material adverse effect on our business, results of operations, cash flows, or financial condition, although such outcome is possible given the nature of our operations and the extensive legal and regulatory framework applicable to our business. We do not have any material known environmental commitments or contingencies.

Business And Credit Concentrations	9 Months Ended
Business And Credit Concentrations	Sep. 30, 2023
Risks and Uncertainties [Abstract]
Business And Credit Concentrations	BUSINESS AND CREDIT CONCENTRATIONS We own and operate franchised automotive stores in the United States pursuant to franchise agreements with vehicle manufacturers. During the nine months ended September 30, 2023, approximately 63% of our total retail new vehicle unit sales was generated by our stores in Florida, Texas, and California. We are subject to a concentration of risk in the event of financial distress of or other adverse event related to a major vehicle manufacturer or related lender or supplier. The core brands of vehicles that we sell, representing approximately 88% of the new vehicles that we sold during the nine months ended September 30, 2023, are manufactured by Toyota (including Lexus), Honda, Ford, General Motors, BMW, Mercedes-Benz, Stellantis, and Volkswagen (including Audi and Porsche). Our business could be materially adversely impacted by a bankruptcy of or other adverse event related to a major vehicle manufacturer or related lender or supplier. We had receivables from manufacturers or distributors of $212.3 million at September 30, 2023, and $174.4 million at December 31, 2022. Additionally, a large portion of our contracts-in-transit included in Receivables, net, in the accompanying Unaudited Condensed Consolidated Balance Sheets, are due from automotive manufacturers’ captive finance subsidiaries, which provide financing directly to our new and used vehicle customers. Concentrations of credit risk with respect to non-manufacturer trade receivables are limited due to the wide variety of customers and markets in which our products are sold as well as their dispersion across many different geographic areas in the United States. Consequently, at September 30, 2023, we do not consider AutoNation to have any significant non-manufacturer concentrations of credit risk.

Segment Information

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

The following table provides information on revenues from external customers and segment income of our reportable segments:


	Three Months Ended						Nine Months Ended
	September 30, 2023						September 30, 2023
	Domestic		Import		Premium Luxury		Domestic		Import		Premium Luxury
Revenues from external customers	$	1,983.9	$	2,077.2	$	2,516.1	$	5,770.5	$	5,864.2	$	7,621.5
Segment income (1)	$	107.2	$	164.7	$	192.9	$	341.5	$	498.1	$	641.2

	Three Months Ended						Nine Months Ended
	September 30, 2022						September 30, 2022
	Domestic		Import		Premium Luxury		Domestic		Import		Premium Luxury
Revenues from external customers	$	2,032.8	$	1,875.2	$	2,506.4	$	6,108.1	$	5,799.0	$	7,601.7
Segment income (1)	$	142.7	$	180.3	$	235.2	$	445.2	$	559.0	$	722.2

(1) Segment income represents income for each of our reportable segments and is defined as operating income less floorplan interest expense.

The following is a reconciliation of total segment income for reportable segments to our consolidated income from continuing operations before income taxes:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Total segment income for reportable segments	$	464.8	$	558.2	$	1,480.8	$	1,726.4
Corporate and other	(83.6)		(46.4)		(277.0)		(148.5)
Other interest expense	(48.8)		(33.7)		(135.9)		(97.4)
Other income (loss), net	(5.0)		(4.6)		4.6		(24.7)
Income from continuing operations before income taxes	$	327.4	$	473.5	$	1,072.5	$	1,455.8

Pay vs Performance Disclosure - USD ($) $ in Millions	3 Months Ended						9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Millions	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net income	$ 243.7	$ 272.5	$ 288.7	$ 352.6	$ 376.3	$ 362.1	$ 804.9	$ 1,091.0

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Interim Financial Statements (Policies)	9 Months Ended
Interim Financial Statements (Policies)	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of AutoNation, Inc. and its subsidiaries; intercompany accounts and transactions have been eliminated. The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. Additionally, operating results for interim periods are not necessarily indicative of the results that can be expected for a full year. The Unaudited Condensed Consolidated Financial Statements herein should be read in conjunction with our audited Consolidated Financial Statements and notes thereto included within our most recent Annual Report on Form 10-K. These Unaudited Condensed Consolidated Financial Statements reflect, in the opinion of management, all material adjustments (which include only normal recurring adjustments) necessary to fairly state, in all material respects, our financial position and results of operations for the periods presented.
Use of Estimates	The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. In preparing these financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements. We base our estimates and judgments on historical experience and other assumptions that we believe are reasonable. However, application of these accounting policies involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ materially from these estimates. We periodically evaluate estimates and assumptions used in the preparation of the financial statements and make changes on a prospective basis when adjustments are necessary. Such estimates and assumptions affect, among other things, our goodwill, indefinite-lived intangible asset, and long-lived asset valuations; inventory valuation; equity investment valuation; assets held for sale; assessments of variable consideration and related constraints related to retrospective commissions; accruals for chargebacks against revenue recognized from the sale of finance and insurance products; accruals related to self-insurance programs; certain legal proceedings; assessment of the annual income tax expense; valuation of deferred income taxes and income tax contingencies; the allowance for expected credit losses; and measurement of performance-based compensation costs.
Earnings Per Share	Basic earnings per share (“EPS”) is computed by dividing net income by the weighted average number of common shares outstanding for the period, including vested restricted stock unit (“RSU”) awards. Diluted EPS is computed by dividing net income by the weighted average number of shares outstanding, noted above, including the dilutive effect of unvested RSU awards and stock options.
Allowance for Credit Losses	The allowance for credit losses represents the net credit losses expected over the remaining contractual life of our auto loans receivable. The allowance for credit losses is determined using a vintage-level statistical model that captures the relationship between historical changes in gross losses and the lifetime loss curves by month on book, credit tiers at origination, and seasonality, adjusted for expected recoveries based on historical recovery trends. The credit loss model also incorporates reasonable and supportable forecasts about the future utilizing a forecast of a macroeconomic variable, specifically, the change in U.S. disposable personal income, which we believe is most strongly correlated to evaluating and predicting expected credit losses of our auto loans receivable. We utilize a reasonable and supportable forecast period of one year, after which we immediately revert to historical experience. We periodically consider whether the use of alternative variables would result in improved credit loss model accuracy and revise the model when appropriate. We also consider whether qualitative adjustments are necessary for factors that are not reflected in the quantitative methods but impact the measurement of estimated credit losses. Such adjustments include the expectations of the impact of recent economic trends on customer behavior.
Impairment of Long-Lived Assets	Nonfinancial assets such as goodwill, other intangible assets, and long-lived assets held and used, are measured at fair value when there is an indicator of impairment and recorded at fair value only when impairment is recognized or for a business combination. The fair values less costs to sell of long-lived assets or disposal groups held for sale are assessed each reporting period they remain classified as held for sale. Subsequent changes in the held for sale long-lived asset’s or disposal group's fair value less cost to sell (increase or decrease) are reported as an adjustment to its carrying amount, except that the adjusted carrying amount cannot exceed the carrying amount of the long-lived asset or disposal group at the time it was initially classified as held for sale.

Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2023

Revenue Recognition [Abstract]

Disaggregation of Revenue

In the following tables, revenue is disaggregated by major lines of goods and services and timing of transfer of goods and services. The tables also include a reconciliation of the disaggregated revenue to reportable segment revenue.


	Three Months Ended September 30, 2023
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	916.1	$	1,042.5	$	1,229.0	$	—	$	3,187.6
Used vehicle	649.1		602.4		773.1		147.5		2,172.1
Parts and service	301.7		299.6		402.4		153.7		1,157.4
Finance and insurance, net	115.6		129.1		111.5		13.3		369.5
Other	1.4		3.6		0.1		1.0		6.1
	$	1,983.9	$	2,077.2	$	2,516.1	$	315.5	$	6,892.7

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	1,765.2	$	1,841.7	$	2,175.5	$	211.3	$	5,993.7
Goods and services transferred over time(2)	218.7		235.5		340.6		104.2		899.0
	$	1,983.9	$	2,077.2	$	2,516.1	$	315.5	$	6,892.7


	Three Months Ended September 30, 2022
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	875.0	$	814.1	$	1,174.8	$	—	$	2,863.9
Used vehicle	764.3		667.4		853.0		117.0		2,401.7
Parts and service	275.8		266.2		364.5		125.6		1,032.1
Finance and insurance, net	117.1		123.1		112.5		8.0		360.7
Other	0.6		4.4		1.6		1.0		7.6
	$	2,032.8	$	1,875.2	$	2,506.4	$	251.6	$	6,666.0

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	1,839.4	$	1,673.0	$	2,199.8	$	169.9	$	5,882.1
Goods and services transferred over time(2)	193.4		202.2		306.6		81.7		783.9
	$	2,032.8	$	1,875.2	$	2,506.4	$	251.6	$	6,666.0


	Nine Months Ended September 30, 2023
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	2,667.1	$	2,910.1	$	3,823.3	$	—	$	9,400.5
Used vehicle	1,880.4		1,707.7		2,275.8		428.8		6,292.7
Parts and service	888.0		859.3		1,188.9		456.3		3,392.5
Finance and insurance, net	332.2		369.5		332.3		37.4		1,071.4
Other	2.8		17.6		1.2		2.8		24.4
	$	5,770.5	$	5,864.2	$	7,621.5	$	925.3	$	20,181.5

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	5,134.6	$	5,200.1	$	6,613.1	$	616.7	$	17,564.5
Goods and services transferred over time(2)	635.9		664.1		1,008.4		308.6		2,617.0
	$	5,770.5	$	5,864.2	$	7,621.5	$	925.3	$	20,181.5


	Nine Months Ended September 30, 2022
	Domestic		Import		Premium Luxury		Corporate and other(1)		Total
Major Goods/Service Lines
New vehicle	$	2,555.6	$	2,548.1	$	3,503.2	$	—	$	8,606.9
Used vehicle	2,374.2		2,074.6		2,673.7		372.0		7,494.5
Parts and service	820.0		788.0		1,083.4		380.9		3,072.3
Finance and insurance, net	355.7		375.2		338.1		23.2		1,092.2
Other	2.6		13.1		3.3		3.1		22.1
	$	6,108.1	$	5,799.0	$	7,601.7	$	779.2	$	20,288.0

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	5,538.8	$	5,205.8	$	6,697.5	$	536.0	$	17,978.1
Goods and services transferred over time(2)	569.3		593.2		904.2		243.2		2,309.9
	$	6,108.1	$	5,799.0	$	7,601.7	$	779.2	$	20,288.0

(2) Represents revenue recognized during the period for automotive repair and maintenance services.

Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction


	Revenue Expected to Be Recognized by Period
	Total		Next 12 Months		13 - 36 Months		37 - 60 Months
Revenue expected to be recognized on VCP contracts sold as of period end	$	106.2	$	36.2	$	51.6	$	18.4

Receivables from Contracts with Customers, Contract Assets, and Contract Liabilities

The following table provides the balances of our receivables from contracts with customers and our current and long-term contract assets and contract liabilities:


	September 30, 2023		December 31, 2022
Receivables from contracts with customers, net	$	629.1	$	634.5
Contract Asset (Current)	$	22.5	$	27.7
Contract Asset (Long-Term)	$	3.4	$	8.6
Contract Liability (Current)	$	41.9	$	41.8
Contract Liability (Long-Term)	$	70.0	$	66.6


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amounts included in contract liability at the beginning of the period	$	8.5	$	8.1	$	26.9	$	25.9
Performance obligations satisfied in previous periods	$	4.1	$	(0.9)	$	1.5	$	3.8

Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2023

Earnings Per Share [Abstract]

Basic and Diluted Earnings Per Share

The following table presents the calculation of basic and diluted EPS:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Net income from continuing operations	$	243.7	$	352.7	$	804.0	$	1,091.3
Income (loss) from discontinued operations, net of income taxes	—		(0.1)		0.9		(0.3)
Net income	$	243.7	$	352.6	$	804.9	$	1,091.0

Basic weighted average common shares outstanding	43.6		55.5		45.3		58.5
Dilutive effect of unvested RSUs and stock options	0.4		0.4		0.3		0.4
Diluted weighted average common shares outstanding	44.0		55.9		45.6		58.9

Basic EPS amounts(1):
Continuing operations	$	5.59	$	6.35	$	17.75	$	18.65
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.59	$	6.35	$	17.77	$	18.65

Diluted EPS amounts(1):
Continuing operations	$	5.54	$	6.31	$	17.63	$	18.53
Discontinued operations	$	—	$	—	$	0.02	$	(0.01)
Net income	$	5.54	$	6.31	$	17.65	$	18.52

(1) EPS amounts are calculated discretely and, therefore, may not add up to the total due to rounding.

Anti-Dilutive Equity Instruments Excluded From The Computation Of Diluted EPS

A summary of anti-dilutive equity instruments excluded from the computation of diluted EPS is as follows:


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2023	2022	2023	2022
Anti-dilutive equity instruments excluded from the computation of diluted EPS	—	0.1	—	0.1

Receivables, Net (Tables)

9 Months Ended

Sep. 30, 2023

Receivables [Abstract]

Components Of Receivables, Net Of Allowances For Expected Credit Losses

The components of receivables, net of allowances for expected credit losses, are as follows:


	September 30, 2023		December 31, 2022
Contracts-in-transit and vehicle receivables	$	408.0	$	441.1
Trade receivables	172.4		156.6
Manufacturer receivables	212.3		174.4
Income taxes receivable (see Note 9)	24.8		20.2
Other	61.8		68.2
	879.3		860.5
Less: allowances for expected credit losses	(2.0)		(1.7)
Receivables, net	$	877.3	$	858.8

Auto Loans Receivable (Tables)

9 Months Ended

Sep. 30, 2023

Receivables [Abstract]

Auto Loans Receivable

The components of auto loans receivable, net of unearned discounts and allowances for expected credit losses, at September 30, 2023, and December 31, 2022, are as follows:


	September 30, 2023		December 31, 2022




Total auto loans receivable	$	373.6	$	377.0
Accrued interest and fees	4.1		4.4
Deferred loan origination costs	0.7		0.5
Less: unearned discounts	(10.5)		(21.3)
Less: allowances for expected credit losses	(47.9)		(57.5)
Auto loans receivable, net	$	320.0	$	303.1

Financing Receivable Credit Quality Indicators

The following tables present auto loans receivable as of September 30, 2023, and December 31, 2022, disaggregated by major credit program tier:



	Fiscal Year of Origination
As of September 30, 2023	2023		2022		2021		2020		2019		Prior to 2019		Total
Credit Program Tier(1):
Platinum	$	70.4	$	16.5	$	9.2	$	4.0	$	4.0	$	0.7	$	104.8
Gold	52.8		39.8		21.0		8.2		5.8		1.2		128.8
Silver	50.4		37.4		19.2		6.3		3.9		0.6		117.8
Bronze	6.2		1.4		7.3		1.9		0.1		0.1		17.0
Copper	0.4		0.4		3.5		0.7		0.1		0.1		5.2
Total auto loans receivable	$	180.2	$	95.5	$	60.2	$	21.1	$	13.9	$	2.7	$	373.6

Current-period gross write-offs	$	4.5	$	27.3	$	12.5	$	3.7	$	2.1	$	0.6	$	50.7

	Fiscal Year of Origination
As of December 31, 2022	2022		2021		2020		2019		2018		Prior to 2018		Total
Credit Program Tier(1):
Platinum	$	21.9	$	12.9	$	6.4	$	7.4	$	2.2	$	0.2	$	51.0
Gold	53.7		30.0		12.9		10.6		3.2		0.4		110.8
Silver	61.9		29.8		10.4		8.0		1.9		0.1		112.1
Bronze	41.4		17.1		7.4		3.7		1.0		0.1		70.7
Copper	19.2		8.0		2.6		1.8		0.7		0.1		32.4
Total auto loans receivable	$	198.1	$	97.8	$	39.7	$	31.5	$	9.0	$	0.9	$	377.0

(1) Classified based on credit grade assigned when customer was initially approved for financing.

Financing Receivable, Allowance for Credit Loss

The following is a rollforward of our allowance for expected credit losses for auto loans receivable for the nine months ended September 30, 2023:


	Nine Months Ended
	September 30, 2023
Balance as of beginning of year	$	57.5
Provision for credit losses	36.0

Write-offs	(50.7)
Recoveries(1)	21.2
Sold loans	(16.1)
Balance as of September 30, 2023	$	47.9

(1) Includes proceeds from the recovery of vehicle collateral, net of costs incurred.

Financing Receivable, Past Due

The following table presents past due auto loans receivable, as of September 30, 2023, and December 31, 2022:


	Age Analysis of Past-Due Auto Loans Receivable as of
	September 30, 2023		December 31, 2022
31-60 Days	$	18.6	$	13.0
61-90 Days	5.5		4.1
Greater than 90 Days	3.7		2.6
Total Past Due	$	27.8	$	19.7

Current	345.8		357.3
Total	$	373.6	$	377.0

Inventory And Vehicle Floorplan Payable (Tables)

9 Months Ended

Sep. 30, 2023

Inventory And Vehicle Floorplan Payable [Abstract]

Components Of Inventory

The components of inventory are as follows:


	September 30, 2023		December 31, 2022
New vehicles	$	1,578.7	$	1,009.7
Used vehicles	801.0		789.1
Parts, accessories, and other	265.9		249.5
Inventory	$	2,645.6	$	2,048.3

Components Of Vehicle Floorplan Payable

The components of vehicle floorplan payable are as follows:


	September 30, 2023		December 31, 2022
Vehicle floorplan payable - trade	$	1,358.7	$	946.6
Vehicle floorplan payable - non-trade	1,456.1		1,162.7
Vehicle floorplan payable	$	2,814.8	$	2,109.3

Goodwill And Intangible Assets, Net (Tables)

9 Months Ended

Sep. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill And Intangible Assets, Net

Goodwill and intangible assets, net, consist of the following:


	September 30, 2023		December 31, 2022
Goodwill (1)	$	1,455.7	$	1,320.1

Franchise rights - indefinite-lived	$	876.2	$	816.2
Other intangibles	70.7		30.7
	946.9		846.9
Less: accumulated amortization	(15.1)		(9.9)
Other intangible assets, net	$	931.8	$	837.0

Debt (Tables)

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Long-Term Debt

Non-vehicle long-term debt consisted of the following:


Debt Description	Maturity Date	Interest Payable	September 30, 2023		December 31, 2022
3.5% Senior Notes	November 15, 2024	May 15 and November 15	$	450.0	$	450.0
4.5% Senior Notes	October 1, 2025	April 1 and October 1	450.0		450.0
3.8% Senior Notes	November 15, 2027	May 15 and November 15	300.0		300.0
1.95% Senior Notes	August 1, 2028	February 1 and August 1	400.0		400.0
4.75% Senior Notes	June 1, 2030	June 1 and December 1	500.0		500.0
2.4% Senior Notes	August 1, 2031	February 1 and August 1	450.0		450.0
3.85% Senior Notes	March 1, 2032	March 1 and September 1	700.0		700.0
Revolving credit facility	July 18, 2028	Monthly	—		—
Finance leases and other debt	Various dates through 2041		365.3		375.5
			3,615.3		3,625.5
Less: unamortized debt discounts and debt issuance costs			(22.9)		(26.0)
Less: current maturities			(12.8)		(12.6)
Long-term debt, net of current maturities			$	3,579.6	$	3,586.9

Schedule of non-recourse Debt

Non-recourse debt outstanding at September 30, 2023, and December 31, 2022, consisted of the following:


	September 30, 2023		December 31, 2022
Warehouse facilities	$	189.0	$	181.8
Term securitization debt of consolidated VIEs	59.2		146.9
	248.2		328.7
Less: unamortized debt discounts and debt issuance costs	(2.1)		(5.1)
Less: current maturities	(7.2)		(10.7)
Non-recourse debt, net of current maturities	$	238.9	$	312.9

Shareholders' Equity (Tables)

9 Months Ended

Sep. 30, 2023

Stockholders' Equity Note [Abstract]

Shares Repurchased Under Stock Repurchase Program

A summary of shares repurchased under our stock repurchase program authorized by our Board of Directors follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Shares repurchased	1.3		3.8		5.3		10.9
Aggregate purchase price (1)	$	200.0	$	428.2	$	712.4	$	1,213.1
Average purchase price per share	$	155.91	$	113.51	$	135.38	$	110.96

(1) Excludes excise tax accrual imposed under the Inflation Reduction Act of $2.0 million and $6.6 million for the three and nine months ended September 30, 2023, respectively.

Common Stock Issued With The Exercise Of Stock Options

A summary of shares of common stock issued in connection with the exercise of stock options follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Shares issued (in actual number of shares)	7,000		16,570		37,996		71,030
Proceeds from the exercise of stock options	$	0.4	$	0.8	$	1.9	$	3.4
Average exercise price per share	$	57.15	$	48.15	$	50.34	$	47.94

Shares Issued And Shares Surrendered To Satisfy Tax Withholdings In Connection With Restricted Stock Units


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(In actual number of shares)	2023	2022	2023	2022
Shares issued	987	1,227	531,994	775,312
Shares surrendered to AutoNation to satisfy tax withholding obligations	278	570	182,527	263,521

Cash Flow Information (Tables)

9 Months Ended

Sep. 30, 2023

Supplemental Cash Flow Information [Abstract]

Reconciliation of cash and cash equivalents

The following table provides a reconciliation of cash and cash equivalents reported on our Unaudited Condensed Consolidated Balance Sheets to the total amounts reported on our Unaudited Condensed Consolidated Statements of Cash Flows:


	September 30, 2023		December 31, 2022
Cash and cash equivalents	$	64.0	$	72.6
Restricted cash included in Other Current Assets	12.6		15.6
Restricted cash included in Other Assets	1.8		7.2
Total cash, cash equivalents, and restricted cash	$	78.4	$	95.4

Supplemental noncash information, Lessee


	Nine Months Ended
	September 30,
	2023		2022
Supplemental noncash information on adjustments to right-of-use assets, including right-of-use assets obtained in exchange for new:
Operating lease liabilities	$	78.6	$	53.2
Finance lease liabilities	$	40.3	$	20.2

Financial Instruments And Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Gains (losses) recognized related to equity investments


	Nine Months Ended
	September 30,
	2023		2022
Net losses recognized during the period on equity securities	$	(2.3)	$	(0.1)
Less: Net losses recognized during the period on equity securities sold during the period	—		—
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date	$	(2.3)	$	(0.1)

Summary Of Carrying Values And Fair Values Of Fixed Rate Debt

A summary of the aggregate carrying values and fair values of our senior unsecured notes is as follows:


	September 30, 2023		December 31, 2022
Carrying value	$	3,227.1	$	3,224.0
Fair value	$	2,817.8	$	2,803.6

Assets Measured and Recorded At Fair Value On A Nonrecurring Basis

The following table presents assets measured and recorded at fair value on a nonrecurring basis during the nine months ended September 30, 2023 and 2022:


	2023				2022
Description	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)		Gain/(Loss)		Fair Value Measurements Using Significant Unobservable Inputs (Level 3)		Gain/(Loss)



Long-lived assets held and used	$	—	$	(2.7)	$	—	$	(1.0)

Segment Information (Tables)

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Reportable Segment Revenues and Segment Income

The following table provides information on revenues from external customers and segment income of our reportable segments:


	Three Months Ended						Nine Months Ended
	September 30, 2023						September 30, 2023
	Domestic		Import		Premium Luxury		Domestic		Import		Premium Luxury
Revenues from external customers	$	1,983.9	$	2,077.2	$	2,516.1	$	5,770.5	$	5,864.2	$	7,621.5
Segment income (1)	$	107.2	$	164.7	$	192.9	$	341.5	$	498.1	$	641.2

	Three Months Ended						Nine Months Ended
	September 30, 2022						September 30, 2022
	Domestic		Import		Premium Luxury		Domestic		Import		Premium Luxury
Revenues from external customers	$	2,032.8	$	1,875.2	$	2,506.4	$	6,108.1	$	5,799.0	$	7,601.7
Segment income (1)	$	142.7	$	180.3	$	235.2	$	445.2	$	559.0	$	722.2

(1) Segment income represents income for each of our reportable segments and is defined as operating income less floorplan interest expense.

Reconciliation of Segment Income

The following is a reconciliation of total segment income for reportable segments to our consolidated income from continuing operations before income taxes:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Total segment income for reportable segments	$	464.8	$	558.2	$	1,480.8	$	1,726.4
Corporate and other	(83.6)		(46.4)		(277.0)		(148.5)
Other interest expense	(48.8)		(33.7)		(135.9)		(97.4)
Other income (loss), net	(5.0)		(4.6)		4.6		(24.7)
Income from continuing operations before income taxes	$	327.4	$	473.5	$	1,072.5	$	1,455.8

Interim Financial Statements (Details)	9 Months Ended
Interim Financial Statements (Details)	Sep. 30, 2023 franchises store brand
Product Information [Line Items]
Owned and operated new vehicle franchises \| franchises	354
Number of brands \| brand	34
Percentage of new vehicle sales from core brands (percent)	88.00%
Dealerships
Product Information [Line Items]
Number of stores	253
Collision Centers
Product Information [Line Items]
Number of stores	53
AutoNation USA Stores
Product Information [Line Items]
Number of stores	17
Automotive Auction Operations
Product Information [Line Items]
Number of stores	4
Parts Distribution Centers
Product Information [Line Items]
Number of stores	3

Revenue Recognition (Disaggregation of Revenue) (Details) - USD ($)
$ in Millions

3 Months Ended

9 Months Ended

Sep. 30, 2023

Sep. 30, 2022

Sep. 30, 2023

Sep. 30, 2022

Disaggregation of Revenue [Line Items]

Revenues

$ 6,892.7

$ 6,666.0

$ 20,181.5

$ 20,288.0

Transferred at Point in Time

Disaggregation of Revenue [Line Items]

Revenues

5,993.7

5,882.1

17,564.5

17,978.1

Transferred over Time

Disaggregation of Revenue [Line Items]

Revenues

^[1]

899.0

783.9

2,617.0

2,309.9

New vehicle

Disaggregation of Revenue [Line Items]

Revenues

3,187.6

2,863.9

9,400.5

8,606.9

Used vehicle

Disaggregation of Revenue [Line Items]

Revenues

2,172.1

2,401.7

6,292.7

7,494.5

Parts and service

Disaggregation of Revenue [Line Items]

Revenues

1,157.4

1,032.1

3,392.5

3,072.3

Finance and insurance, net

Disaggregation of Revenue [Line Items]

Revenues

369.5

360.7

1,071.4

1,092.2

Other

Disaggregation of Revenue [Line Items]

Revenues

6.1

7.6

24.4

22.1

Domestic

Disaggregation of Revenue [Line Items]

Revenues

1,983.9

2,032.8

5,770.5

6,108.1

Domestic | Transferred at Point in Time

Disaggregation of Revenue [Line Items]

Revenues

1,765.2

1,839.4

5,134.6

5,538.8

Domestic | Transferred over Time

Disaggregation of Revenue [Line Items]

Revenues

^[1]

218.7

193.4

635.9

569.3

Domestic | New vehicle

Disaggregation of Revenue [Line Items]

Revenues

916.1

875.0

2,667.1

2,555.6

Domestic | Used vehicle

Disaggregation of Revenue [Line Items]

Revenues

649.1

764.3

1,880.4

2,374.2

Domestic | Parts and service

Disaggregation of Revenue [Line Items]

Revenues

301.7

275.8

888.0

820.0

Domestic | Finance and insurance, net

Disaggregation of Revenue [Line Items]

Revenues

115.6

117.1

332.2

355.7

Domestic | Other

Disaggregation of Revenue [Line Items]

Revenues

1.4

0.6

2.8

2.6

Import

Disaggregation of Revenue [Line Items]

Revenues

2,077.2

1,875.2

5,864.2

5,799.0

Import | Transferred at Point in Time

Disaggregation of Revenue [Line Items]

Revenues

1,841.7

1,673.0

5,200.1

5,205.8

Import | Transferred over Time

Disaggregation of Revenue [Line Items]

Revenues

^[1]

235.5

202.2

664.1

593.2

Import | New vehicle

Disaggregation of Revenue [Line Items]

Revenues

1,042.5

814.1

2,910.1

2,548.1

Import | Used vehicle

Disaggregation of Revenue [Line Items]

Revenues

602.4

667.4

1,707.7

2,074.6

Import | Parts and service

Disaggregation of Revenue [Line Items]

Revenues

299.6

266.2

859.3

788.0

Import | Finance and insurance, net

Disaggregation of Revenue [Line Items]

Revenues

129.1

123.1

369.5

375.2

Import | Other

Disaggregation of Revenue [Line Items]

Revenues

3.6

4.4

17.6

13.1

Premium Luxury

Disaggregation of Revenue [Line Items]

Revenues

2,516.1

2,506.4

7,621.5

7,601.7

Premium Luxury | Transferred at Point in Time

Disaggregation of Revenue [Line Items]

Revenues

2,175.5

2,199.8

6,613.1

6,697.5

Premium Luxury | Transferred over Time

Disaggregation of Revenue [Line Items]

Revenues

^[1]

340.6

306.6

1,008.4

904.2

Premium Luxury | New vehicle

Disaggregation of Revenue [Line Items]

Revenues

1,229.0

1,174.8

3,823.3

3,503.2

Premium Luxury | Used vehicle

Disaggregation of Revenue [Line Items]

Revenues

773.1

853.0

2,275.8

2,673.7

Premium Luxury | Parts and service

Disaggregation of Revenue [Line Items]

Revenues

402.4

364.5

1,188.9

1,083.4

Premium Luxury | Finance and insurance, net

Disaggregation of Revenue [Line Items]

Revenues

111.5

112.5

332.3

338.1

Premium Luxury | Other

Disaggregation of Revenue [Line Items]

Revenues

0.1

1.6

1.2

3.3

Corporate and other

Disaggregation of Revenue [Line Items]

Revenues

^[2]

315.5

251.6

925.3

779.2

Corporate and other | Transferred at Point in Time

Disaggregation of Revenue [Line Items]

Revenues

^[2]

211.3

169.9

616.7

536.0

Corporate and other | Transferred over Time

Disaggregation of Revenue [Line Items]

Revenues

^[1],[2]

104.2

81.7

308.6

243.2

Corporate and other | New vehicle

Disaggregation of Revenue [Line Items]

Revenues

^[2]

0.0

Corporate and other | Used vehicle

Disaggregation of Revenue [Line Items]

Revenues

^[2]

147.5

117.0

428.8

372.0

Corporate and other | Parts and service

Disaggregation of Revenue [Line Items]

Revenues

^[2]

153.7

125.6

456.3

380.9

Corporate and other | Finance and insurance, net

Disaggregation of Revenue [Line Items]

Revenues

^[2]

13.3

8.0

37.4

23.2

Corporate and other | Other

Disaggregation of Revenue [Line Items]

Revenues

^[2]

$ 1.0

$ 2.8

$ 3.1

[1]	(2) Represents revenue recognized during the period for automotive repair and maintenance services.
[2]	(1) “Corporate and other” is comprised of our other businesses, including AutoNation USA used vehicle stores, collision centers, parts distribution centers, auction operations, and our mobile automotive repair and maintenance business.

Revenue Recognition (Estimated Revenue Expected to be Recognized In the Future) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2023 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Vehicle maintenance program, contract term	5 years
Revenue expected to be recognized on VCP contracts sold as of period end	$ 106.2
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction, period	1 year
Revenue expected to be recognized on VCP contracts sold as of period end	$ 36.2
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction, period	2 years
Revenue expected to be recognized on VCP contracts sold as of period end	$ 51.6
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction, period	2 years
Revenue expected to be recognized on VCP contracts sold as of period end	$ 18.4

Revenue Recognition (Contract Assets and Liabilities) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Revenue Recognition [Abstract]
Receivables from contracts with customers, net	$ 629.1		$ 629.1		$ 634.5
Contract Asset (Current)	22.5		22.5		27.7
Contract Asset (Long-Term)	3.4		3.4		8.6
Contract Liability (Current)	41.9		41.9		41.8
Contract Liability (Long-Term)	70.0		70.0		$ 66.6
Amounts included in contract liability at the beginning of the period	8.5	$ 8.1	26.9	$ 25.9
Performance obligations satisfied in previous periods	$ 4.1	$ (0.9)	1.5	3.8
Contract assets reclassified to receivables			$ 28.7	$ 30.5

Earnings Per Share (Basic and Diluted) (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions

3 Months Ended

9 Months Ended

Sep. 30, 2023

Jun. 30, 2023

Mar. 31, 2023

Sep. 30, 2022

Jun. 30, 2022

Mar. 31, 2022

Sep. 30, 2023

Sep. 30, 2022

Earnings Per Share [Abstract]

Net income from continuing operations

$ 243.7

$ 352.7

$ 804.0

$ 1,091.3

Income (loss) from discontinued operations, net of income taxes

0.0

(0.1)

0.9

(0.3)

NET INCOME

$ 243.7

$ 272.5

$ 288.7

$ 352.6

$ 376.3

$ 362.1

$ 804.9

$ 1,091.0

Basic weighted average common shares outstanding (in shares)

43.6

55.5

45.3

58.5

Dilutive effect of unvested RSUs and stock options (in shares)

0.4

0.3

0.4

Diluted weighted average common shares outstanding (in shares)

44.0

55.9

45.6

58.9

Basic EPS amounts:

Continuing operations (in dollars per share)

^[1]

$ 5.59

$ 6.35

$ 17.75

$ 18.65

Discontinued operations (in dollars per share)

^[1]

0.02

(0.01)

Net income (in dollars per share)

^[1]

5.59

6.35

17.77

18.65

Diluted EPS amounts:

Continuing operations (in dollars per share)

^[1]

5.54

6.31

17.63

18.53

Discontinued operations (in dollars per share)

^[1]

0.02

(0.01)

Net income (in dollars per share)

^[1]

$ 5.54

$ 6.31

$ 17.65

$ 18.52

[1]	(1) EPS amounts are calculated discretely and, therefore, may not add up to the total due to rounding.

Earnings Per Share (Anti-Dilutive Equity Instruments Excluded From The Computation Of Diluted Earnings Per Share) (Details) - shares shares in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Earnings Per Share [Abstract]
Anti-dilutive equity instruments excluded from the computation of diluted earnings per share (in shares)	0.0	0.1	0.0	0.1

Receivables, Net (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Receivables [Abstract]
Contracts-in-transit and vehicle receivables	$ 408.0	$ 441.1
Trade receivables	172.4	156.6
Manufacturer receivables	212.3	174.4
Income taxes receivable (see Note 9)	24.8	20.2
Other	61.8	68.2
Receivables, gross	879.3	860.5
Less: allowances for expected credit losses	(2.0)	(1.7)
Receivables, net	$ 877.3	$ 858.8

Auto Loans Receivable - Components Of Receivables, Net Of Allowances For Expected Credit Losses (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Receivables [Abstract]
Total auto loans receivable	$ 373.6	$ 377.0
Accrued interest and fees	4.1	4.4
Deferred loan origination costs	0.7	0.5
Less: unearned discounts	(10.5)	(21.3)
Less: allowances for expected credit losses	(47.9)	(57.5)
Auto loans receivable, net	$ 320.0	$ 303.1

Auto Loans Receivable - Financing Receivable Credit Quality Indicators (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Auto Loans Receivable
Auto loans receivable, Originated in current year	$ 180.2	$ 198.1
Auto loans receivable, Originated in year before current year	95.5	97.8
Auto loans receivable, Originated two years before current year	60.2	39.7
Auto loans receivable, Originated three years before current year	21.1	31.5
Auto loans receivable, Originated four years before current year	13.9	9.0
Auto loans receivable, Originated five years or more before current year	2.7	0.9
Total auto loans receivable	373.6	377.0
Financing Receivable, Allowance for Credit Loss, Writeoff, by Origination Year [Abstract]
Current-period gross write-offs, 2023 origination	4.5
Current-period gross write-offs, 2022 origination	27.3
Current-period gross write-offs, 2021 origination	12.5
Current-period gross write-offs, 2020 origination	3.7
Current-period gross write-offs, 2019 origination	2.1
Current-period gross write-offs, Prior to 2019 origination	0.6
Current-period gross write-offs	50.7
Platinum
Auto Loans Receivable
Auto loans receivable, Originated in current year	70.4	21.9
Auto loans receivable, Originated in year before current year	16.5	12.9
Auto loans receivable, Originated two years before current year	9.2	6.4
Auto loans receivable, Originated three years before current year	4.0	7.4
Auto loans receivable, Originated four years before current year	4.0	2.2
Auto loans receivable, Originated five years or more before current year	0.7	0.2
Total auto loans receivable	104.8	51.0
Gold
Auto Loans Receivable
Auto loans receivable, Originated in current year	52.8	53.7
Auto loans receivable, Originated in year before current year	39.8	30.0
Auto loans receivable, Originated two years before current year	21.0	12.9
Auto loans receivable, Originated three years before current year	8.2	10.6
Auto loans receivable, Originated four years before current year	5.8	3.2
Auto loans receivable, Originated five years or more before current year	1.2	0.4
Total auto loans receivable	128.8	110.8
Silver
Auto Loans Receivable
Auto loans receivable, Originated in current year	50.4	61.9
Auto loans receivable, Originated in year before current year	37.4	29.8
Auto loans receivable, Originated two years before current year	19.2	10.4
Auto loans receivable, Originated three years before current year	6.3	8.0
Auto loans receivable, Originated four years before current year	3.9	1.9
Auto loans receivable, Originated five years or more before current year	0.6	0.1
Total auto loans receivable	117.8	112.1
Bronze
Auto Loans Receivable
Auto loans receivable, Originated in current year	6.2	41.4
Auto loans receivable, Originated in year before current year	1.4	17.1
Auto loans receivable, Originated two years before current year	7.3	7.4
Auto loans receivable, Originated three years before current year	1.9	3.7
Auto loans receivable, Originated four years before current year	0.1	1.0
Auto loans receivable, Originated five years or more before current year	0.1	0.1
Total auto loans receivable	17.0	70.7
Copper
Auto Loans Receivable
Auto loans receivable, Originated in current year	0.4	19.2
Auto loans receivable, Originated in year before current year	0.4	8.0
Auto loans receivable, Originated two years before current year	3.5	2.6
Auto loans receivable, Originated three years before current year	0.7	1.8
Auto loans receivable, Originated four years before current year	0.1	0.7
Auto loans receivable, Originated five years or more before current year	0.1	0.1
Total auto loans receivable	$ 5.2	$ 32.4

Auto Loans Receivable - Financing Receivable, Allowance for Credit Loss (Details) - USD ($)
$ in Millions

9 Months Ended

Sep. 30, 2023

Sep. 30, 2022

Financing Receivable, Allowance for Credit Loss [Roll Forward]

Balance as of beginning of year

$ 57.5

Provision for credit losses

36.0

$ 0.0

Write-offs

(50.7)

Recoveries

^[1]

21.2

Sold loans

(16.1)

Balance as of September 30, 2023

47.9

Sold auto loans receivable, aggregate amortized cost

60.6

Proceeds from the sale of auto loans receivable

68.7

0.0

Gain on sale of auto loans receivable

$ 8.1

$ 0.0

[1]	(1) Includes proceeds from the recovery of vehicle collateral, net of costs incurred.

Auto Loans Receivable - Financing Receivable, Past Due (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Financing Receivable, Past Due [Line Items]
Total auto loans receivable	$ 373.6	$ 377.0
Total Past Due
Financing Receivable, Past Due [Line Items]
Total auto loans receivable	27.8	19.7
31-60 Days
Financing Receivable, Past Due [Line Items]
Total auto loans receivable	18.6	13.0
61-90 Days
Financing Receivable, Past Due [Line Items]
Total auto loans receivable	5.5	4.1
Greater than 90 Days
Financing Receivable, Past Due [Line Items]
Total auto loans receivable	3.7	2.6
Current
Financing Receivable, Past Due [Line Items]
Total auto loans receivable	$ 345.8	$ 357.3

Inventory And Vehicle Floorplan Payable (Components Of Inventory) (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Inventory [Line Items]
Inventory	$ 2,645.6	$ 2,048.3
New vehicle
Inventory [Line Items]
Inventory	1,578.7	1,009.7
Used vehicle
Inventory [Line Items]
Inventory	801.0	789.1
Parts and service
Inventory [Line Items]
Inventory	$ 265.9	$ 249.5

Inventory And Vehicle Floorplan Payable (Components Of Vehicle Floorplan Payable) (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Floorplan Payable [Line Items]
Vehicle floorplan payable	$ 2,814.8	$ 2,109.3
Trade
Floorplan Payable [Line Items]
Vehicle floorplan payable	1,358.7	946.6
Non-Trade
Floorplan Payable [Line Items]
Vehicle floorplan payable	$ 1,456.1	$ 1,162.7

Inventory And Vehicle Floorplan Payable (Narrative) (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Floorplan Payable [Line Items]
Vehicle floorplan facilities, amount outstanding	$ 2,814.8	$ 2,109.3
Used vehicle floorplan facilities, remaining borrowing capacity	184.3
Used vehicle floorplan facilities, current borrowing capacity	$ 0.3
New Vehicle Floorplan Facilities
Floorplan Payable [Line Items]
Vehicle floorplan facilities, weighted-average interest rate (percent)	7.00%	5.90%
Vehicle floorplan facilities, maximum borrowing capacity	$ 4,600.0
Vehicle floorplan facilities, amount outstanding	$ 2,200.0
Used Vehicle Floorplan Facilities
Floorplan Payable [Line Items]
Vehicle floorplan facilities, weighted-average interest rate (percent)	7.00%	5.90%
Vehicle floorplan facilities, maximum borrowing capacity	$ 775.6
Vehicle floorplan facilities, amount outstanding	$ 591.3

Goodwill And Intangible Assets, Net (Details) - USD ($)
$ in Millions

Sep. 30, 2023

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

$ 1,455.7

^[1]

$ 1,320.1

Franchise rights - indefinite-lived

876.2

816.2

Other intangibles

70.7

30.7

Other intangible assets, gross

946.9

846.9

Less: accumulated amortization

(15.1)

(9.9)

Other intangible assets, net

$ 931.8

$ 837.0

[1]	(1) The change in goodwill from the prior period is primarily due to the acquisition of the mobile repair and maintenance business we acquired in January 2023. Such goodwill is reflected in our Mobile Service reporting unit.

Debt (Long-Term Debt) (Details) - USD ($) $ in Millions	2 Months Ended	9 Months Ended
Debt (Long-Term Debt) (Details) - USD ($) $ in Millions	Sep. 30, 2023	Sep. 30, 2023	Dec. 31, 2022
Less: current maturities	$ (12.8)	$ (12.8)	$ (12.6)
Long-term debt, net of current maturities	3,579.6	3,579.6	3,586.9
Recourse
Long-term debt	3,615.3	3,615.3	3,625.5
Less: unamortized debt discounts and debt issuance costs	(22.9)	(22.9)	(26.0)
Less: current maturities	(12.8)	(12.8)	(12.6)
Long-term debt, net of current maturities	$ 3,579.6	$ 3,579.6	3,586.9
3.5% Senior Notes \| Senior Notes \| Recourse
Percentage interest on debt instrument	3.50%	3.50%
Maturity date		Nov. 15, 2024
Senior notes	$ 450.0	$ 450.0	450.0
4.5% Senior Notes \| Senior Notes \| Recourse
Percentage interest on debt instrument	4.50%	4.50%
Maturity date		Oct. 01, 2025
Senior notes	$ 450.0	$ 450.0	450.0
3.8% Senior Notes \| Senior Notes \| Recourse
Percentage interest on debt instrument	3.80%	3.80%
Maturity date		Nov. 15, 2027
Senior notes	$ 300.0	$ 300.0	300.0
1.95% Senior Notes \| Senior Notes \| Recourse
Percentage interest on debt instrument	1.95%	1.95%
Maturity date		Aug. 01, 2028
Senior notes	$ 400.0	$ 400.0	400.0
4.75% Senior Notes \| Senior Notes \| Recourse
Percentage interest on debt instrument	4.75%	4.75%
Maturity date		Jun. 01, 2030
Senior notes	$ 500.0	$ 500.0	500.0
2.4% Senior Notes \| Senior Notes \| Recourse
Percentage interest on debt instrument	2.40%	2.40%
Maturity date		Aug. 01, 2031
Senior notes	$ 450.0	$ 450.0	450.0
3.85% Senior Notes \| Senior Notes
Percentage interest on debt instrument	3.85%	3.85%
3.85% Senior Notes \| Senior Notes \| Recourse
Percentage interest on debt instrument	3.85%	3.85%
Maturity date		Mar. 01, 2032
Senior notes	$ 700.0	$ 700.0	700.0
Revolving Credit Facility Due 2028 \| Recourse
Revolving credit facility	$ 0.0	$ 0.0
Revolving Credit Facility Due 2028 \| Line of Credit \| Recourse
Maturity date	Jul. 18, 2028	Jul. 18, 2028
Revolving Credit Facility Due 2025 \| Recourse
Revolving credit facility			0.0
Other Debt \| Recourse
Finance leases and other debt	$ 365.3	$ 365.3	$ 375.5

Long-Term Debt And Commercial Paper (Narrative) (Details) $ in Millions	2 Months Ended	9 Months Ended	12 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2023 USD ($)	Dec. 31, 2022 USD ($)	Aug. 16, 2023 USD ($)	Jul. 18, 2023 USD ($)
Debt Instrument [Line Items]
Letters of credit, amount outstanding	$ 0.8	$ 0.8
Commercial paper, maximum aggregate amount outstanding permitted	1,900.0	1,900.0		$ 1,000.0
Commercial paper, amount outstanding	$ 350.0	$ 350.0	$ 50.0
Commercial Paper
Debt Instrument [Line Items]
Weighted-average annual interest rate	6.05%	6.05%	4.30%
Maximum \| Commercial Paper
Debt Instrument [Line Items]
Maturity period of debt		397 days
Weighted Average \| Commercial Paper
Debt Instrument [Line Items]
Maturity period of debt		16 days	1 day
Revolving Credit Facility Due 2025
Debt Instrument [Line Items]
Maximum borrowing capacity under revolving credit facility					$ 1,800.0
Debt Instrument Covenant Terms Maximum Leverage Ratio					3.75
Revolving Credit Facility Due 2025 \| Recourse
Debt Instrument [Line Items]
Revolving credit facility, amount outstanding			$ 0.0
Revolving Credit Facility Due 2028
Debt Instrument [Line Items]
Maximum borrowing capacity under revolving credit facility	$ 1,900.0	$ 1,900.0			$ 1,900.0
Debt Instrument Covenant Terms Maximum Leverage Ratio					4.25
Additional borrowing capacity under accordion feature of revolving credit facility	500.0	500.0
Revolving credit facilities letter of credit sublimit	200.0	200.0
Additional borrowing capacity under the revolving credit facility	1,900.0	1,900.0
Revolving Credit Facility Due 2028 \| Recourse
Debt Instrument [Line Items]
Revolving credit facility, amount outstanding	$ 0.0	0.0
Revolving Credit Facility Due 2028 \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Credit spread adjustment on SOFR borrowings under our revolving credit facility	0.10%
Revolving Credit Facility Due 2028 \| Minimum
Debt Instrument [Line Items]
Commitment fee on undrawn amounts (percent)	0.125%
Revolving Credit Facility Due 2028 \| Maximum
Debt Instrument [Line Items]
Commitment fee on undrawn amounts (percent)	0.20%
Other Debt \| Recourse
Debt Instrument [Line Items]
Finance leases and other debt obligations included in long-term debt	$ 365.3	$ 365.3	$ 375.5
Line of Credit \| Revolving Credit Facility Due 2028 \| Recourse
Debt Instrument [Line Items]
Maturity date	Jul. 18, 2028	Jul. 18, 2028
Line of Credit \| Revolving Credit Facility Due 2028 \| Minimum \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Basis spread on variable interest rates (percent)	1.125%
Line of Credit \| Revolving Credit Facility Due 2028 \| Minimum \| Base Rate
Debt Instrument [Line Items]
Basis spread on variable interest rates (percent)	0.125%
Line of Credit \| Revolving Credit Facility Due 2028 \| Maximum \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Basis spread on variable interest rates (percent)	1.50%
Line of Credit \| Revolving Credit Facility Due 2028 \| Maximum \| Base Rate
Debt Instrument [Line Items]
Basis spread on variable interest rates (percent)	0.50%

Debt (Non-Recourse Debt) (Details) - USD ($) $ in Millions	9 Months Ended
Debt (Non-Recourse Debt) (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Less: current maturities	$ (7.2)	$ (10.7)
Non-recourse debt, net of current maturities	238.9	312.9
Restricted cash included in Other Current Assets	12.6	15.6
Auto loans receivable	373.6	377.0
Variable Interest Entity, Primary Beneficiary \| Asset Pledged as Collateral
Debt Instrument [Line Items]
Restricted cash included in Other Current Assets	4.6	14.9
Auto loans receivable	59.8	151.4
Nonrecourse
Debt Instrument [Line Items]
Non Recourse Debt	248.2	328.7
Less: unamortized debt discounts and debt issuance costs	(2.1)	(5.1)
Less: current maturities	(7.2)	(10.7)
Non-recourse debt, net of current maturities	238.9	312.9
Warehouse Facilities \| Nonrecourse
Debt Instrument [Line Items]
Non Recourse Debt	189.0	181.8
Warehouse Facilities Maximum Borrowing Capacity	$ 350.0
Warehouse Facility One [Member] \| Nonrecourse
Debt Instrument [Line Items]
Maturity date	Oct. 01, 2024
Warehouse Facility Two [Member] \| Nonrecourse
Debt Instrument [Line Items]
Maturity date	Dec. 17, 2023
Term securitization debt \| Nonrecourse \| Variable Interest Entity, Primary Beneficiary
Debt Instrument [Line Items]
Non Recourse Debt	$ 59.2	$ 146.9
Term securitization debt \| Minimum \| Nonrecourse \| Variable Interest Entity, Primary Beneficiary
Debt Instrument [Line Items]
Percentage interest on debt instrument	1.49%
Term securitization debt \| Maximum \| Nonrecourse \| Variable Interest Entity, Primary Beneficiary
Debt Instrument [Line Items]
Percentage interest on debt instrument	4.45%

Income Taxes (Details) - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Income taxes receivable	$ 24.8	$ 20.2

Shareholders' Equity (Shares Repurchased Under Stock Repurchase Program) (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions

3 Months Ended

9 Months Ended

Sep. 30, 2023

Jun. 30, 2023

Mar. 31, 2023

Sep. 30, 2022

Jun. 30, 2022

Mar. 31, 2022

Sep. 30, 2023

Sep. 30, 2022

Class of Stock [Line Items]

Aggregate purchase price

$ 202.0

$ 209.5

$ 307.5

$ 428.2

$ 403.9

$ 380.9

Excise tax accrual on share repurchases

$ 2.0

$ 6.6

Stock Repurchase Program Board Authorized Repurchases

Class of Stock [Line Items]

Shares repurchased (in shares)

1.3

3.8

5.3

10.9

Aggregate purchase price

$ 200.0

^[1]

$ 428.2

^[1]

$ 712.4

$ 1,213.1

Average purchase price per share (in dollars per share)

$ 155.91

$ 113.51

$ 135.38

$ 110.96

Remaining amount available for share repurchase

$ 472.0

[1]	(1) Excludes excise tax accrual imposed under the Inflation Reduction Act of $2.0 million and $6.6 million for the three and nine months ended September 30, 2023, respectively.

Shareholders' Equity (Preferred Stock) (Details)	Sep. 30, 2023 $ / shares shares
Equity [Abstract]
Preferred stock authorized (in shares)	5,000,000
Preferred stock, par value (in dollars per share) \| $ / shares	$ 0.01
Preferred stock issued (in shares)	0

Shareholders' Equity (Common Stock Issued With The Exercise Of Stock Options) (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Stockholders' Equity Note [Abstract]
Shares issued (in actual number of shares)	7,000	16,570	37,996	71,030
Proceeds from the exercise of stock options	$ 0.4	$ 0.8	$ 1.9	$ 3.4
Average exercise price per share (in dollars per share)	$ 57.15	$ 48.15	$ 50.34	$ 47.94

Shareholders' Equity (Shares Issued And Shares Surrendered To Satisfy Tax Withholdings In Connection With Restricted Stock Units) (Details) - Restricted Stock Units (RSUs) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares)	987	1,227	531,994	775,312
Shares surrendered to AutoNation to satisfy tax withholding obligations (in shares)	278	570	182,527	263,521

Acquisitions and Divestitures (Details) $ in Millions	9 Months Ended
Acquisitions and Divestitures (Details) $ in Millions	Sep. 30, 2023 store	Sep. 30, 2022 USD ($) store
Business Acquisition [Line Items]
Gain on disposal \| $		$ 16.1
Dealerships Divested
Business Acquisition [Line Items]
Number of businesses divested		3
Dealerships
Business Acquisition [Line Items]
Number of businesses acquired	7

Cash Flow Information (Details) - USD ($) $ in Millions	9 Months Ended
Cash Flow Information (Details) - USD ($) $ in Millions	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Dec. 31, 2021
Supplemental Cash Flow Information [Abstract]
Cash and cash equivalents	$ 64.0		$ 72.6
Restricted cash included in Other Current Assets	12.6		15.6
Restricted cash included in Other Assets	1.8		7.2
Total cash, cash equivalents, and restricted cash	78.4	$ 443.0	$ 95.4	$ 60.6
Accrued purchases of property and equipment	33.5	29.7
Adjustments to right-of use assets including right-of-use assets obtained in exchange for new operating lease liabilities	78.6	53.2
Adjustments to right-of use assets including right-of-use assets obtained in exchange for new finance lease liabilities	40.3	20.2
Interest payments, net of amounts capitalized and including interest on vehicle inventory financing	218.2	96.7
Income tax payments, net of income tax refunds	$ 267.2	$ 368.0

Financial Instruments And Fair Value Measurements (Summary Of Carrying Values And Fair Values Of Fixed Rate Debt) (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Equity investments with readily determinable fair values	$ 13.3		$ 15.4
Equity investment without readily determinable fair value	56.7		56.7
Net losses recognized during the period on equity securities	(2.3)	$ (0.1)
Less: Net losses recognized during the period on equity securities sold during the period	0.0	0.0
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date	(2.3)	$ (0.1)
Carrying value \| Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fixed rate debt	3,227.1		3,224.0
Fair value \| Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fixed rate debt	2,817.8		$ 2,803.6
Nonrecurring Basis
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investment in equity securities without readily determinable fair values, cumulative upward adjustment	$ 3.4

Financial Instruments And Fair Value Measurements (Assets Measured on a Nonrecurring Basis) (Details) - Nonrecurring Basis - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Gain/(Loss) on assets held and used	$ (2.7)	$ (1.0)
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets held and used	$ 0.0	$ 0.0

Financial Instruments and Fair Value Measurements (Narrative) (Details) - Carrying value - USD ($) $ in Millions	Sep. 30, 2023	Dec. 31, 2022
Continuing Operations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets held for sale	$ 41.6	$ 5.7
Discontinued Operations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets held for sale in discontinued operations	$ 0.0	$ 1.1

Commitments And Contingencies (Details) $ in Millions	Sep. 30, 2023 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Guarantor obligations, maximum exposure	$ 5.0
Total surety bonds, letters of credit, and cash deposits	111.5
Letters of credit, amount outstanding	$ 0.8

Business And Credit Concentrations (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Risks and Uncertainties [Abstract]
Percentage of total retail new vehicle unit sales from stores located in Florida, Texas and California	63.00%
Percentage of new vehicle sales from core brands (percent)	88.00%
Manufacturer receivables	$ 212.3	$ 174.4