Penske Automotive (PAG) 10-Q 28 Jul 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Jul. 21, 2017
Document and Entity Information
Entity Registrant Name	PENSKE AUTOMOTIVE GROUP, INC.
Entity Central Index Key	1,019,849
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		86,020,397
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
ASSETS
Cash and cash equivalents	$ 20.7	$ 24
Accounts receivable, net of allowance for doubtful accounts of $4.9 and $4.5	827.7	879
Inventories	3,711.9	3,408.2
Other current assets	104.2	73.9
Assets held for sale		8.4
Total current assets	4,664.5	4,393.5
Property and equipment, net	1,990.3	1,806.5
Goodwill	1,641.3	1,291.2
Other indefinite-lived intangible assets	467.7	420.1
Equity method investments	921.5	893.4
Other long-term assets	26.6	28.3
Total assets	9,711.9	8,833
LIABILITIES AND EQUITY
Floor plan notes payable	2,151.1	2,084.5
Floor plan notes payable - non-trade	1,364.7	1,233.3
Accounts payable	559.9	497.4
Accrued expenses	413.2	360
Current portion of long-term debt	70.1	48.3
Liabilities held for sale	0.7	6.1
Total current liabilities	4,559.7	4,229.6
Long-term debt	1,955.8	1,828.8
Deferred tax liabilities	655.2	564.6
Other long-term liabilities	524.5	430.5
Total liabilities	7,695.2	7,053.5
Commitments and contingent liabilities (Note 9)
Penske Automotive Group stockholders' equity:
Common Stock
Additional paid-in-capital	529.6	497.1
Retained earnings	1,640.9	1,504.5
Accumulated other comprehensive income (loss)	(186.2)	(250.7)
Total Penske Automotive Group stockholders' equity	1,984.3	1,750.9
Non-controlling interest	32.4	28.6
Total equity	2,016.7	1,779.5
Total liabilities and equity	9,711.9	8,833
Non-voting Common Stock
Penske Automotive Group stockholders' equity:
Common Stock
Class C Common Stock
Penske Automotive Group stockholders' equity:
Common Stock

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 4.9	$ 4.5
Preferred Stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred Stock, shares authorized	100,000	100,000
Common Stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common Stock, shares authorized	240,000,000	240,000,000
Common Stock, shares issued	86,020,397	85,214,345
Common Stock, shares outstanding	86,020,397	85,214,345
Non-voting Common Stock
Common Stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common Stock, shares authorized	7,125,000	7,125,000
Common Stock, shares issued	0	0
Common Stock, shares outstanding	0	0
Class C Common Stock
Common Stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common Stock, shares authorized	20,000,000	20,000,000
Common Stock, shares issued	0	0
Common Stock, shares outstanding	0	0

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Revenue:
Total revenues	$ 5,383.4	$ 5,254.1	$ 10,464.5	$ 10,078.7
Cost of sales:
Total cost of sales	4,566.1	4,482.8	8,872.9	8,583.6
Gross profit	817.3	771.3	1,591.6	1,495.1
Selling, general and administrative expenses	622	582.7	1,223.7	1,141.6
Depreciation	23.3	24.5	45.7	45.3
Operating income	172	164.1	322.2	308.2
Floor plan interest expense	(15.5)	(13.1)	(29.2)	(25.9)
Other interest expense	(26.4)	(19.5)	(51.4)	(36.7)
Equity in earnings of affiliates	26.8	12	40	17.5
Income from continuing operations before income taxes	156.9	143.5	281.6	263.1
Income taxes	(50.2)	(47.3)	(91.3)	(86.7)
Income from continuing operations	106.7	96.2	190.3	176.4
Income (loss) from discontinued operations, net of tax	0.2	(1.2)	(0.4)	(1.2)
Net income	106.9	95	189.9	175.2
Less: Income attributable to non-controlling interests	0.7	1.5	1.1	2.4
Net income attributable to Penske Automotive Group common stockholders	$ 106.2	$ 93.5	$ 188.8	$ 172.8
Basic earnings per share attributable to Penske Automotive Group common stockholders:
Continuing operations (in dollars per share)	$ 1.23	$ 1.11	$ 2.20	$ 2.01
Discontinued operations (in dollars per share)	0	(0.01)	0	(0.01)
Net income attributable to Penske Automotive Group common stockholders (in dollars per share)	$ 1.23	$ 1.10	$ 2.20	$ 1.99
Shares used in determining basic earnings per share (in shares)	86.1	85.3	85.9	86.7
Diluted earnings per share attributable to Penske Automotive Group common stockholders:
Continuing operations (in dollars per share)	$ 1.23	$ 1.11	$ 2.20	$ 2
Discontinued operations (in dollars per share)	0	(0.01)	0	(0.01)
Net income attributable to Penske Automotive Group common stockholders (in dollars per share)	$ 1.23	$ 1.10	$ 2.20	$ 1.99
Shares used in determining diluted earnings per share (in shares)	86.1	85.3	85.9	86.8
Amounts attributable to Penske Automotive Group common stockholders:
Income from continuing operations	$ 106.7	$ 96.2	$ 190.3	$ 176.4
Less: Income attributable to non-controlling interests	0.7	1.5	1.1	2.4
Income from continuing operations, net of tax	106	94.7	189.2	174
Income (loss) from discontinued operations, net of tax	0.2	(1.2)	(0.4)	(1.2)
Net income attributable to Penske Automotive Group common stockholders	$ 106.2	$ 93.5	$ 188.8	$ 172.8
Cash dividends per share (in dollars per share)	$ 0.31	$ 0.27	$ 0.61	$ 0.53
Retail Automotive Dealership
Revenue:
Total revenues	$ 5,040.7	$ 4,836.8	$ 9,797.1	$ 9,349.7
Cost of sales:
Total cost of sales	4,294.7	4,134.8	8,342.8	7,982.7
Retail Commercial Truck Dealership
Revenue:
Total revenues	228.5	309.5	440.2	516.2
Cost of sales:
Total cost of sales	188.5	271.2	363.8	444.7
Commercial Vehicle Distribution and Other
Revenue:
Total revenues	114.2	107.8	227.2	212.8
Cost of sales:
Total cost of sales	$ 82.9	$ 76.8	$ 166.3	$ 156.2

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 106.9	$ 95	$ 189.9	$ 175.2
Other comprehensive income:
Foreign currency translation adjustment	37.7	(56.1)	62.4	(55.8)
Other adjustments to comprehensive income, net	2.8	0.6	4.2	1.5
Other comprehensive income (loss), net of tax	40.5	(55.5)	66.6	(54.3)
Comprehensive income	147.4	39.5	256.5	120.9
Less: Comprehensive income attributable to non-controlling interests	2.4	0.8	3.2	3.2
Comprehensive income attributable to Penske Automotive Group common stockholders	$ 145	$ 38.7	$ 253.3	$ 117.7

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Operating Activities:
Net income	$ 189.9	$ 175.2
Adjustments to reconcile net income to net cash from continuing operating activities:
Depreciation	45.7	45.3
Earnings of equity method investments	(34.1)	(15.7)
Loss from discontinued operations, net of tax	0.4	1.2
Deferred income taxes	89.2	19
Changes in operating assets and liabilities:
Accounts receivable	58.2	(41.2)
Inventories	(177.8)	156.5
Floor plan notes payable	66.7	(185.4)
Accounts payable and accrued expenses	86.1	80.6
Other	(3.8)	35.1
Net cash provided by continuing operating activities	320.5	270.6
Investing Activities:
Purchase of equipment and improvements	(113.4)	(136.7)
Acquisitions net, including repayment of sellers’ floor plan notes payable of $99.0 and $44.7, respectively	(431.9)	(65.4)
Other	15	(25)
Net cash used in continuing investing activities	(530.3)	(227.1)
Financing Activities:
Proceeds from borrowings under U.S. credit agreement revolving credit line	1,012	629.5
Repayments under U.S. credit agreement revolving credit line	(929)	(789.5)
Issuance of 5.50% senior subordinated notes		500
Net borrowings of other long-term debt	54.9	60.9
Net borrowings (repayments) of floor plan notes payable — non-trade	131.3	(163)
Payment of debt issuance costs		(6.6)
Repurchases of common stock	(8.5)	(173.6)
Dividends	(52.4)	(46.4)
Other	(5.8)	(15.9)
Net cash provided by (used in) continuing financing activities	202.5	(4.6)
Discontinued operations:
Net cash provided by discontinued operating activities	0.4	1.3
Net cash provided by discontinued investing activities	2.3	1.7
Net cash used in discontinued financing activities	(0.2)	(0.1)
Net cash provided by discontinued operations	2.5	2.9
Effect of exchange rate changes on cash and cash equivalents	1.5	(6.7)
Net change in cash and cash equivalents	(3.3)	35.1
Cash and cash equivalents, beginning of period	24	62.4
Cash and cash equivalents, end of period	20.7	97.5
Cash paid for:
Interest	78.9	60.5
Income taxes	8.3	$ 26.9
Seller financed/assumed debt	3.8
Non cash activities:
Consideration transferred through common stock issuance	32.4
Contingent consideration	$ 20

CONSOLIDATED STATEMENTS OF CAS7

CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Repayment of Sellers' Floor Plan Notes Payable Dealership Acquisitions	$ 99	$ 44.7

CONSOLIDATED STATEMENT OF EQUIT

CONSOLIDATED STATEMENT OF EQUITY - 6 months ended Jun. 30, 2017 - USD ($) $ in Millions	Total Stockholders' Equity Attributable to Penske Automotive Group	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Non-controlling Interest	Total
Balance at Dec. 31, 2016	$ 1,750.9		$ 497.1	$ 1,504.5	$ (250.7)	$ 28.6	$ 1,779.5
Balance (in shares) at Dec. 31, 2016		85,214,345
Increase (decrease) in stockholders' equity
Equity compensation	8.6		8.6				8.6
Equity compensation (in shares)		324,275
Repurchases of common stock	(8.5)		(8.5)				(8.5)
Repurchases of common stock (in shares)		(183,710)
Issuance of common stock	32.4		32.4				32.4
Issuance of common stock (in shares)		665,487
Dividends	(52.4)			(52.4)			(52.4)
Distributions to non-controlling interests						(0.9)	(0.9)
Foreign currency translation	60.3				60.3	2.1	62.4
Other	4.2				4.2	1.5	5.7
Net income	188.8			188.8		1.1	189.9
Balance at Jun. 30, 2017	$ 1,984.3		$ 529.6	$ 1,640.9	$ (186.2)	$ 32.4	$ 2,016.7
Balance (in shares) at Jun. 30, 2017		86,020,397

Interim Financial Statements

Interim Financial Statements	6 Months Ended
	Jun. 30, 2017
Interim Financial Statements.
Interim Financial Statements	PENSKE AUTOMOTIVE GROUP, INC. NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) 1. Interim Financial Statements Business Overview Unless the context otherwise requires, the use of the terms “PAG,” “we,” “us,” and “our” in these Notes to the Consolidated Condensed Financial Statements refers to Penske Automotive Group, Inc. and its consolidated subsidiaries. We are an international transportation services company that operates automotive and commercial truck dealerships principally in the United States, Canada and Western Europe, and distributes commercial vehicles, diesel engines, gas engines, power systems and related parts and services principally in Australia and New Zealand. Retail Automotive Dealership. We believe we are the second largest automotive retailer headquartered in the U.S. as measured by the $18.7 billion in total retail automotive dealership revenue we generated in 2016. As of June 30, 2017, we operated 354 retail automotive franchises, of which 162 franchises are located in the U.S. and 192 franchises are located outside of the U.S. The franchises outside the U.S. are located primarily in the U.K. In the six months ended June 30, 2017, we retailed and wholesaled more than 315,200 vehicles. We are diversified geographically, with 58% of our total retail automotive dealership revenues in the six months ended June 30, 2017 generated in the U.S. and Puerto Rico and 42% generated outside the U.S. We offer over 40 vehicle brands, with 70% of our retail automotive dealership revenue in the six months ended June 30, 2017 generated from premium brands, such as Audi, BMW, Mercedes-Benz and Porsche. Each of our dealerships offer a wide selection of new and used vehicles for sale. In addition to selling new and used vehicles, we generate higher-margin revenue at each of our dealerships through maintenance and repair services and the sale and placement of third-party finance and insurance products, third-party extended service and maintenance contracts and replacement and aftermarket automotive products. We operate these dealerships under franchise agreements with a number of automotive manufacturers and distributors that are subject to certain rights and restrictions typical of the industry. In the first quarter of 2017, we acquired CarSense in the U.S. and CarShop in the U.K., both businesses representing stand-alone used vehicle dealerships which we believe complement our existing franchised retail automotive dealership operations, providing us with synergies in our used vehicle operations at our existing dealerships in the U.S. and the U.K., as well as scalable opportunities across our market areas. Our CarSense operations consist of five locations operating in the Philadelphia and Pittsburgh, Pennsylvania market areas, including southern New Jersey. Our CarShop operations consist of five retail locations throughout the United Kingdom and a vehicle preparation center in Leighton Buzzard. During the six months ended June 30, 2017, we also acquired six retail automotive franchises, were awarded two retail automotive franchises, and disposed of nine retail automotive franchises. Of the retail automotive franchises acquired, two are located in New Jersey and represent the Jaguar and Land Rover brands, two are located in Arizona and represent the Mercedes-Benz and Sprinter brands, and two are located in Germany as part of the Jacobs Group and represent the Audi and Volkswagen brands. Of the franchises disposed of, five represented smart franchises. Retail Commercial Truck Dealership. We operate a heavy and medium duty truck dealership group known as Premier Truck Group (“PTG”) with locations in Texas, Oklahoma, Tennessee, Georgia, and Canada. As of June 30, 2017, PTG operated twenty locations, including fourteen full-service dealerships offering primarily Freightliner and Western Star branded trucks. Four of these locations were acquired in April 2016 in the greater Toronto, Canada market area, and two of these locations were acquired in December 2016 in the Niagara Falls, Canada market area, also representing Freightliner and Western Star branded trucks. PTG also offers a full range of used trucks available for sale as well as service and parts departments, many of which are open 24 hours a day, seven days a week. Commercial Vehicle Distribution . We are the exclusive importer and distributor of Western Star heavy-duty trucks (a Daimler brand), MAN heavy and medium duty trucks and buses (a VW Group brand), and Dennis Eagle refuse collection vehicles, together with associated parts, across Australia, New Zealand and portions of the Pacific. This business, known as Penske Commercial Vehicles Australia (“PCV Australia”), distributes commercial vehicles and parts to a network of more than 70 dealership locations, including ten company-owned retail commercial vehicle dealerships. We are also a leading distributor of diesel and gas engines and power systems, principally representing MTU, Detroit Diesel, Mercedes-Benz Industrial, Allison Transmission and MTU Onsite Energy. This business, known as Penske Power Systems (“PPS”), offers products across the on- and off-highway markets in Australia, New Zealand and portions of the Pacific and supports full parts and aftersales service through a network of branches, field locations and dealers across the region. The on-highway portion of this business complements our PCV Australia distribution business, including integrated operations at retail locations shared with PCV. Penske Truck Leasing. We currently hold a 23.4% ownership interest in Penske Truck Leasing Co., L.P. (“PTL”), a leading provider of transportation services and supply chain management. PTL is capable of meeting customers’ needs across the supply chain with a broad product offering that includes full-service truck leasing, truck rental and contract maintenance, along with logistic services such as dedicated contract carriage, distribution center management, transportation management and lead logistics provider. On July 27, 2016, we acquired an additional 14.4% ownership interest in PTL from subsidiaries of GE Capital Global Holdings, LLC (collectively, “GE Capital”) for approximately $498.5 million in cash to bring our total ownership interest to 23.4%. Prior to this acquisition, we held a 9.0% ownership interest in PTL. PTL is currently owned 41.1% by Penske Corporation, 23.4% by us, 20.0% by affiliates of Mitsui & Co., Ltd. (“Mitsui”), and 15.5% by GE Capital. We account for our investment in PTL under the equity method, and we therefore record our share of PTL’s earnings on our statements of income under the caption “Equity in earnings of affiliates,” which also includes the results of our other equity method investments. Basis of Presentation The accompanying unaudited consolidated condensed financial statements of PAG have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of June 30, 2017 and December 31, 2016 and for the three and six month periods ended June 30, 2017 and 2016 is unaudited, but includes all adjustments which our management believes to be necessary for the fair presentation of results for the periods presented. The consolidated condensed financial statements for prior periods have been revised for entities that have been treated as discontinued operations, and results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with our audited financial statements for the year ended December 31, 2016, which are included as part of our Annual Report on Form 10-K. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers (Topic 606).” This ASU supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers using a five-step model that requires entities to exercise judgment when considering the terms of contracts with customers. In August 2015, the FASB issued ASU 2015-14 “Revenue from Contracts with Customers (Topic 606) — Deferral of the Effective Date” providing for a one-year deferral of the effective date of ASU 2014-09 and allowing for early adoption as of the original effective date. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2017, and interim periods within those annual periods. The FASB has since also issued additional ASUs containing various updates to Topic 606 which will all be adopted along with ASU 2014-09. These ASUs can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption, with early adoption permitted. We intend to adopt these ASUs on January 1, 2018. We have performed our preliminary assessment of the potential impact these accounting standard updates will have on our consolidated financial position, results of operations, and cash flows and have begun our documentation of the results of this assessment. Based on our assessment performed to date, we do not expect the adoption of these updates to have a material impact on our financial statements; however, we will be required to enhance our disclosures on revenue recognition upon adoption. We do not expect there to be a significant change in the timing of our revenue recognition, as we anticipate that our performance obligations under the new standard will be similar to those under existing guidance. Therefore, we expect to adopt using a cumulative-effect adjustment as of the date of adoption. We are also in the process of evaluating and documenting any changes in controls and procedures that may be necessary as part of our implementation of the new standards; however, we do not expect material changes. We will continue to assess the impact that these new standards will have our on our consolidated financial position, results of operations, and cash flows, throughout the remainder of 2017. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” Under ASU 2015-11, inventory that is measured using the first-in, first-out (FIFO), specific identification, or average cost methods should be measured at the lower of cost or net realizable value. This ASU does not impact inventory measurement under the last-in, first-out (LIFO) or retail inventory methods. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. The amendments from this update are to be applied prospectively. We adopted this ASU prospectively on the effective date of January 1, 2017. The adoption of this accounting standard update has not had a material impact on our consolidated financial position, results of operations, and cash flows. In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740) — Balance Sheet Classification of Deferred Taxes.” Under ASU 2015-17, entities are required to classify all deferred tax liabilities and assets as noncurrent in a classified statement of financial position. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. The amendments from this update are to be applied either prospectively or retrospectively. We adopted this ASU retrospectively on the effective date of January 1, 2017. Amounts reclassified from “Other current assets” to “Deferred tax liabilities” were $28.1 million as of December 31, 2016. Other than the revised presentation of our consolidated balance sheets, the adoption of this accounting standard update has not had a material impact on our consolidated financial position, results of operations, and cash flows. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” Under this new guidance, a company will now recognize most leases on its balance sheet as lease liabilities with corresponding right-of-use assets. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2018, and interim periods within those annual periods, with early adoption permitted. We intend to adopt this ASU on January 1, 2019. The amendments from this update are to be applied using a modified retrospective approach. The adoption of this ASU will result in a significant increase to our consolidated balance sheets for lease liabilities and right-of-use assets. We are currently evaluating the other effects the adoption of this ASU will have on our consolidated financial statements. We believe our current off-balance sheet leasing commitments are reflected in our credit rating. In March 2016, the FASB issued ASU No. 2016-09, “Compensation —Stock Compensation (Topic 718) — Improvement to Employee Share-Based Payment Accounting.” This ASU simplified several aspects of accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. This ASU was adopted on the effective date of January 1, 2017. As part of the adoption of this ASU, we have elected to record forfeitures as they occur. The amendments to timing of recognition of excess tax benefits, minimum statutory withholding requirements, and forfeitures were adopted using a modified retrospective approach. The cumulative-effect adjustment to retained earnings as of January 1, 2017 was not material. Amendments related to cash flow presentation of employee taxes paid was adopted retrospectively, with $6.1 million reclassified from operating activities to financing activities for the six months ended June 30, 2016. Amendments related to the recognition of excess tax benefits on the income statement and presentation of excess tax benefits on the statement of cash flows were adopted prospectively, and therefore, prior periods were not adjusted. The adoption of this accounting standard update has not had a material impact on our consolidated financial position, results of operations, and cash flows. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230) — Classification of Certain Cash Receipts and Cash Payments.” This ASU provides new guidance on eight specific cash flow issues related to how such cash receipts and cash payments should be presented in a statement of cash flows. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2017, and interim periods within those annual periods, with early adoption permitted. The amendments from this update are to be applied retrospectively. We intend to adopt this ASU on January 1, 2018. We do not expect the adoption of this accounting standard update to have a material impact on our consolidated cash flows. Assets Held for Sale and Discontinued Operations We classify an entity as held for sale in the period in which all of the following criteria are met: · management, having the authority to approve the action, commits to a plan to sell the entity; · the entity is available for immediate sale in its present condition; · an active program to locate a buyer and other actions required to complete the plan to sell have been initiated; · the sale is probable and transfer is expected to be completed within one year; · the entity is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and · actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. In April 2014, the FASB issued ASU No. 2014-08 that changed the definition of a discontinued operation to include only those disposals of components of an entity or components of an entity that are classified as held for sale that represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. We adopted this accounting standard update effective January 1, 2015. Prior to the adoption of ASU No. 2014-08, we accounted for dispositions as discontinued operations when it was evident that the operations and cash flows of an entity being disposed of would be eliminated from ongoing operations, and we would not have any significant continuing involvement in its operations. The results of operations for those entities that were classified as discontinued operations prior to adoption of ASU No. 2014-08 are included in “Income (loss) from discontinued operations” in the accompanying Consolidated Condensed Statements of Income for all periods presented and will continue to be reported within discontinued operations in the future. Beginning with disposals or entities classified as held for sale subsequent to January 1, 2015, only those that represent a strategic shift that has, or will have, a major impact on our operations and financial results will be included in discontinued operations. We had no entities newly classified as held for sale during the six months ended June 30, 2017 that met the criteria to be classified as discontinued operations. As such, the combined financial information presented below represents only retail automotive dealerships that were classified as discontinued operations prior to adoption of ASU No. 2014-08: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 Revenues $ — $ 5.6 $ 2.1 $ 14.0 Pre-tax gain (loss) 0.3 (2.0) (0.6) (2.0) June 30, December 31, 2017 2016 Inventories $ — $ 4.6 Other assets — 3.8 Total assets $ — $ 8.4 Floor plan notes payable (including non-trade) $ — $ 4.8 Other liabilities 0.7 1.3 Total liabilities $ 0.7 $ 6.1 Dispositions During the six months ended June 30, 2017, we disposed of nine retail automotive franchises. The results of operations for one of the retail automotive franchises is included in discontinued operations for the six months ended June 30, 2017 and for the three and six months ended June 30, 2016. The remaining eight retail automotive franchises did not meet the criteria to be classified as held for sale and treated as discontinued operations. Therefore, the results of operations for these businesses are included within continuing operations for the three and six months ended June 30, 2017 and 2016. Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets and certain reserves. Fair Value of Financial Instruments 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 that 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 in active markets for identical assets or liabilities Level 2 Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted market prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities Our financial instruments consist of cash and cash equivalents, debt, floor plan notes payable, forward exchange contracts and interest rate swaps used to hedge future cash flows. Other than our fixed rate debt, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. Our fixed rate debt consists of amounts outstanding under our senior subordinated notes and mortgage facilities. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 2), and we estimate the fair value of our mortgage facilities using a present value technique based on current market interest rates for similar types of financial instruments (Level 2). A summary of the carrying values and fair values of our 5.75% senior subordinated notes, 5.375% senior subordinated notes, 5.50% senior subordinated notes, and our fixed rate mortgage facilities are as follows: June 30, 2017 December 31, 2016 Carrying Value Fair Value Carrying Value Fair Value 5.75% senior subordinated notes due 2022 $ 545.5 $ 562.1 $ 545.1 $ 567.6 5.375% senior subordinated notes due 2024 297.0 300.7 296.8 293.0 5.50% senior subordinated notes due 2026 494.1 493.1 493.7 489.4 Mortgage facilities 213.6 212.0 199.9 195.6

Inventories

Inventories	6 Months Ended
	Jun. 30, 2017
Inventories
Inventories	2. Inventories Inventories consisted of the following: June 30, December 31, 2017 2016 Retail automotive dealership new vehicles $ 2,297.7 $ 2,153.0 Retail automotive dealership used vehicles 892.1 771.7 Retail automotive parts, accessories and other 127.3 119.1 Retail commercial truck dealership vehicles and parts 169.4 170.3 Commercial vehicle distribution vehicles and parts 225.4 194.1 Total inventories $ 3,711.9 $ 3,408.2 We receive credits from certain vehicle manufacturers that reduce cost of sales when the vehicles are sold. Such credits amounted to $10.6 million and $10.4 million during the three months ended June 30, 2017 and 2016, respectively, and $20.7 million and $21.8 million during the six months ended June 30, 2017 and 2016, respectively.

Business Combinations

Business Combinations	6 Months Ended
	Jun. 30, 2017
Business Combinations
Business Combinations	3. Business Combinations We acquired CarSense, a stand-alone specialty retailer of used vehicles in the U.S. representing five locations, acquired CarShop, a stand-alone specialty retailer of used vehicles in the U.K. representing five locations, and acquired six retail automotive franchises during the six months ended June 30, 2017. During the six months ended June 30, 2016, we acquired one retail automotive franchise and five retail commercial truck dealerships. Our financial statements include the results of operations of the acquired entities from the date of acquisition. The fair value of the assets acquired and liabilities assumed have been recorded in our consolidated condensed financial statements, and may be subject to adjustment pending completion of final valuation. A summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed for the six months ended June 30, 2017 and 2016 follows: June 30, 2017 2016 Accounts receivable $ 6.9 $ 3.9 Inventory 130.3 45.2 Other current assets 2.5 0.1 Property and equipment 12.8 0.6 Indefinite-lived intangibles 362.1 24.8 Other non-current assets 0.1 — Current liabilities (23.8) (9.2) Non-current liabilities (2.8) — Total consideration 488.1 65.4 Consideration transferred through common stock issuance (32.4) — Contingent consideration (20.0) — Seller financed/assumed debt (3.8) — Total cash used in acquisitions $ 431.9 $ 65.4 The following unaudited consolidated pro forma results of operations of PAG for the three and six months ended June 30, 2017 and 2016 give effect to acquisitions consummated during 2017 and 2016 as if they had occurred effective at the beginning of the periods: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 Revenues $ 5,383.4 $ 5,693.4 $ 10,595.7 $ 11,000.0 Income from continuing operations 106.0 101.5 191.2 188.1 Net income 106.2 100.3 190.8 186.9 Income from continuing operations per diluted common share $ 1.23 $ 1.19 $ 2.23 $ 2.17 Net income per diluted common share $ 1.23 $ 1.18 $ 2.22 $ 2.15

Intangible Assets

Intangible Assets	6 Months Ended
	Jun. 30, 2017
Intangible Assets
Intangible Assets	4. Intangible Assets Following is a summary of the changes in the carrying amount of goodwill and other indefinite-lived intangible assets during the six months ended June 30, 2017: Other Indefinite- Lived Intangible Goodwill Assets Balance, January 1, 2017 $ 1,291.2 $ 420.1 Additions 322.5 39.6 Disposals (1.9) (1.5) Foreign currency translation 29.5 9.5 Balance, June 30, 2017 $ 1,641.3 $ 467.7 The additions and disposals during the six months ended June 30, 2017 were within our Retail Automotive reportable segment. As of June 30, 2017, the goodwill balance within our Retail Automotive, Retail Commercial Truck, and Other reportable segments was $1,394.6 million, $162.6 million and $84.1 million, respectively. There is no goodwill recorded in our Non-Automotive Investments reportable segment.

Vehicle Financing

Vehicle Financing	6 Months Ended
	Jun. 30, 2017
Vehicle Financing
Vehicle Financing	5. Vehicle Financing We finance substantially all of the commercial vehicles we purchase for distribution, new vehicles for retail sale, and a portion of our used vehicle inventories for retail sale, under floor plan and other revolving arrangements with various lenders, including the captive finance companies associated with automotive manufacturers. In the U.S., the floor plan arrangements are due on demand; however, we have not historically been required to repay floor plan advances prior to the sale of the vehicles that have been financed. We typically make monthly interest payments on the amount financed. Outside of the U.S., substantially all of the floor plan arrangements are payable on demand or have an original maturity of 90 days or less, and we are generally required to repay floor plan advances at the earlier of the sale of the vehicles that have been financed or the stated maturity. The agreements typically grant a security interest in substantially all of the assets of our dealership and distribution subsidiaries and, in the U.S., Australia and New Zealand, are guaranteed or partially guaranteed by us. Interest rates under the arrangements are variable and increase or decrease based on changes in the prime rate, defined London Interbank Offered Rate (“LIBOR”), the Finance House Base Rate, the Euro Interbank Offered Rate, the Canadian Prime Rate, or the Australian or New Zealand Bank Bill Swap Rate (“BBSW”). To date, we have not experienced any material limitation with respect to the amount or availability of financing from any institution providing us vehicle financing. We also receive non-refundable credits from certain of our vehicle manufacturers, which are treated as a reduction of cost of sales as vehicles are sold. The weighted average interest rate on floor plan borrowings was 1.7% for the six months ended June 30, 2017 and 1.6% for the six months ended June 30, 2016. We classify floor plan notes payable to a party other than the manufacturer of a particular new vehicle, and all floor plan notes payable relating to pre-owned vehicles, as “Floor plan notes payable—non-trade” on our consolidated balance sheets and classify related cash flows as a financing activity on our consolidated statements of cash flows.

Earnings Per Share

Earnings Per Share	6 Months Ended
	Jun. 30, 2017
Earnings Per Share
Earnings Per Share	6. Earnings Per Share Basic earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, including outstanding unvested equity awards which contain rights to non-forfeitable dividends. Diluted earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, adjusted for any dilutive effects. A reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three and six months ended June 30, 2017 and 2016 follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Weighted average number of common shares outstanding 86,101,711 85,268,625 85,852,971 86,743,783 Effect of non-participatory equity compensation 40,000 36,000 40,000 36,000 Weighted average number of common shares outstanding, including effect of dilutive securities 86,141,711 85,304,625 85,892,971 86,779,783

Long-Term Debt

Long-Term Debt	6 Months Ended
	Jun. 30, 2017
Long-Term Debt
Long-Term Debt	7. Long-Term Debt Long-term debt consisted of the following: June 30, December 31, 2017 2016 U.S. credit agreement — revolving credit line $ 323.0 $ 240.0 U.K. credit agreement — revolving credit line 82.1 48.1 U.K. credit agreement — overdraft line of credit — 2.7 5.50% senior subordinated notes due 2026 494.1 493.7 5.375% senior subordinated notes due 2024 297.0 296.8 5.75% senior subordinated notes due 2022 545.5 545.1 Australia working capital loan agreement 35.6 24.7 Mortgage facilities 213.6 199.9 Other 35.0 26.1 Total long-term debt 2,025.9 1,877.1 Less: current portion (70.1) (48.3) Net long-term debt $ 1,955.8 $ 1,828.8 U.S. Credit Agreement Our U.S. credit agreement (the “U.S. credit agreement”) with Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation provides for up to $700.0 million in revolving loans for working capital, acquisitions, capital expenditures, investments and other general corporate purposes, which includes $250.0 million in revolving loans solely for future U.S. acquisitions. The U.S. credit agreement provides for a maximum of $150.0 million of future borrowings for foreign acquisitions and expires on September 30, 2019, subject to its “evergreen” termination provisions. The revolving loans bear interest at LIBOR plus 2.00%, subject to an incremental 1.50% for uncollateralized borrowings in excess of a defined borrowing base. The U.S. credit agreement is fully and unconditionally guaranteed on a joint and several basis by substantially all of our U.S. subsidiaries and contains a number of significant covenants that, among other things, restrict our ability to dispose of assets, incur additional indebtedness, repay other indebtedness, pay dividends, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. We are also required to comply with specified financial and other tests and ratios, each as defined in the U.S. credit agreement including: a ratio of current assets to current liabilities, a fixed charge coverage ratio, a ratio of debt to stockholders’ equity and a ratio of debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of the amounts owed. The U.S. credit agreement also contains typical events of default, including change of control, non-payment of obligations and cross-defaults to our other material indebtedness. Substantially all of our U.S. assets are subject to security interests granted to the lenders under the U.S. credit agreement. As of June 30, 2017, we had $323.0 million of revolver borrowings outstanding under the U.S. credit agreement. U.K. Credit Agreement Our subsidiaries in the U.K. (the “U.K. subsidiaries”) are party to a £150.0 million revolving credit agreement with the Royal Bank of Scotland plc (RBS) and BMW Financial Services (GB) Limited, and an additional demand overdraft line of credit with RBS (collectively, the “U.K. credit agreement”) to be used for working capital, acquisitions, capital expenditures, investments and general corporate purposes. The loans mature on the termination date of the facility, which is December 19, 2019. The revolving loans bear interest between defined LIBOR plus 1.35% and defined LIBOR plus 3.0% and the demand overdraft line of credit bears interest at the Bank of England Base Rate plus 1.75%. As of June 30, 2017, outstanding loans under the U.K. credit agreement amounted to £63.0 million ($82.1 million). The U.K. credit agreement is fully and unconditionally guaranteed on a joint and several basis by our U.K. subsidiaries, and contains a number of significant covenants that, among other things, restrict the ability of our U.K. subsidiaries to pay dividends, dispose of assets, incur additional indebtedness, repay other indebtedness, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. In addition, our U.K. subsidiaries are required to comply with defined ratios and tests, including: a ratio of earnings before interest, taxes, amortization, and rental payments (“EBITAR”) to interest plus rental payments, a measurement of maximum capital expenditures, and a debt to EBITDA ratio. A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of any amounts owed. The U.K. credit agreement also contains typical events of default, including change of control and non-payment of obligations and cross-defaults to other material indebtedness of our U.K. subsidiaries. Substantially all of our U.K. subsidiaries’ assets are subject to security interests granted to the lenders under the U.K. credit agreement. 5.50% Senior Subordinated Notes due 2026 In May 2016, we issued $500.0 million in aggregate principal amount of 5.50% Senior Subordinated Notes due 2026 (the “5.50% Notes”). Interest on the 5.50% Notes is payable semi-annually on May 15 and November 15 of each year. The 5.50% Notes mature on May 15, 2026, unless earlier redeemed or purchased by us. The 5.50% Notes are our unsecured senior subordinated obligations and are guaranteed on an unsecured senior subordinated basis by our 100% owned U.S. subsidiaries. The 5.50% Notes also contain customary negative covenants and events of default. Prior to May 15, 2021, we may redeem the 5.50% Notes at a redemption price equal to 100% of the principal amount of the 5.50% Notes, plus an applicable make whole premium, and any accrued and unpaid interest. On or after May 15, 2021, we may redeem the 5.50% Notes for cash at the redemption prices noted in the indenture, plus any accrued and unpaid interest. We may also redeem up to 40% of the 5.50% Notes using the proceeds of specified equity offerings at any time prior to May 15, 2019 at a price specified in the indenture. If we experience certain “change of control” events specified in the indenture, holders of the 5.50% Notes will have the option to require us to purchase for cash all or a portion of their notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest. In addition, if we make certain asset sales and do not reinvest the proceeds thereof or use such proceeds to repay certain debt, we will be required to use the proceeds of such asset sales to make an offer to purchase the notes at a price equal to 100% of the principal amount of the notes, plus accrued and unpaid interest. 5.375% Senior Subordinated Notes due 2024 In November 2014, we issued $300.0 million in aggregate principal amount of 5.375% Senior Subordinated Notes due 2024 (the “5.375% Notes”). Interest on the 5.375% Notes is payable semi-annually on June 1 and December 1 of each year. The 5.375% Notes mature on December 1, 2024, unless earlier redeemed or purchased by us. The 5.375% Notes are our unsecured senior subordinated obligations and are guaranteed on an unsecured senior subordinated basis by our 100% owned U.S. subsidiaries. The 5.375% Notes also contain customary negative covenants and events of default. Prior to December 1, 2019, we may redeem the 5.375% Notes at a redemption price equal to 100% of the principal amount of the 5.375% Notes, plus an applicable make whole premium, and any accrued and unpaid interest. On or after December 1, 2019, we may redeem the 5.375% Notes for cash at the redemption prices noted in the indenture, plus any accrued and unpaid interest. We may also redeem up to 40% of the 5.375% Notes using the proceeds of specified equity offerings at any time prior to December 1, 2017 at a price specified in the indenture. If we experience certain “change of control” events specified in the indenture, holders of the 5.375% Notes will have the option to require us to purchase for cash all or a portion of their notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest. In addition, if we make certain asset sales and do not reinvest the proceeds thereof or use such proceeds to repay certain debt, we will be required to use the proceeds of such asset sales to make an offer to purchase the notes at a price equal to 100% of the principal amount of the notes, plus accrued and unpaid interest. 5.75% Senior Subordinated Notes due 2022 In August 2012, we issued $550.0 million in aggregate principal amount of 5.75% Senior Subordinated Notes due 2022 (the “5.75% Notes”). Interest on the 5.75% Notes is payable semi-annually on April 1 and October 1 of each year. The 5.75% Notes mature on October 1, 2022, unless earlier redeemed or purchased by us. The 5.75% Notes are our unsecured senior subordinated obligations and are guaranteed on an unsecured senior subordinated basis by our 100% owned U.S. subsidiaries. The 5.75% Notes also contain customary negative covenants and events of default. Prior to October 1, 2017, we may redeem the 5.75% Notes at a redemption price equal to 100% of the principal amount of the 5.75% Notes, plus an applicable make whole premium, and any accrued and unpaid interest. On or after October 1, 2017, we may redeem the 5.75% Notes for cash at the redemption prices noted in the indenture, plus any accrued and unpaid interest. If we experience certain “change of control” events specified in the indenture, holders of the 5.75% Notes will have the option to require us to purchase for cash all or a portion of their notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest. In addition, if we make certain asset sales and do not reinvest the proceeds thereof or use such proceeds to repay certain debt, we will be required to use the proceeds of such asset sales to make an offer to purchase the notes at a price equal to 100% of the principal amount of the notes, plus accrued and unpaid interest. Australia Working Capital Loan Agreement Penske Commercial Vehicles Australia and Penske Power Systems, are party to a working capital loan agreement with Mercedes-Benz Financial Services Australia Pty Ltd with a capacity of AU $50.5 million. This agreement provides the lender with a secured interest in all assets of these businesses. The loan bears interest at the Australian BBSW 30-day Bill Rate plus 2.35%. As of June 30, 2017, we had AU $46.4 million ($35.6 million) outstanding under the working capital loan agreement. Mortgage Facilities We are party to several mortgages that bear interest at defined rates and require monthly principal and interest payments. These mortgage facilities also contain typical events of default, including non-payment of obligations, cross-defaults to our other material indebtedness, certain change of control events, and the loss or sale of certain franchises operated at the properties. Substantially all of the buildings and improvements on the properties financed pursuant to the mortgage facilities are subject to security interests granted to the lender. As of June 30, 2017, we owed $213.6 million of principal under our mortgage facilities.

Derivatives and Hedging

Derivatives and Hedging	6 Months Ended
	Jun. 30, 2017
Derivatives and Hedging
Derivatives and Hedging	8. Derivatives and Hedging Penske Commercial Vehicles Australia and Penske Power Systems sell vehicles, engines, parts and other products purchased from manufacturers in the U.S., Germany, and the U.K. In order to protect against exchange rate movements, Penske Commercial Vehicles Australia and Penske Power Systems enter into foreign exchange forward contracts against anticipated cash flows. The contracts are timed to mature when major shipments are scheduled to arrive in Australia and when receipt of payment from customers is expected. We classify our foreign exchange forward contracts as cash flow hedges and state them at fair value. We used Level 2 inputs to estimate the fair value of the foreign exchange forward contracts. The fair value of the contracts designated as hedging instruments was estimated to be a liability of $1.0 million and an asset of $0.3 million as of June 30, 2017 and December 31, 2016, respectively.

Commitments and Contingent Liab

Commitments and Contingent Liabilities	6 Months Ended
	Jun. 30, 2017
Commitments and Contingent Liabilities
Commitments and Contingent Liabilities	9. Commitments and Contingent Liabilities We are involved in litigation which may relate to claims brought by governmental authorities, issues with customers, and employment related matters, including class action claims and purported class action claims. As of June 30, 2017, we were not party to any legal proceedings, including class action lawsuits that, individually or in the aggregate, are reasonably expected to 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. We have historically structured our operations so as to minimize ownership of real property. As a result, we lease or sublease substantially all of our facilities. These leases are generally for a period between 5 and 20 years, and are typically structured to include renewal options at our election. Pursuant to the leases for some of our larger facilities, we are required to comply with specified financial ratios, including a “rent coverage” ratio and a debt to EBITDA ratio, each as defined. For these leases, non-compliance with the ratios may require us to post collateral in the form of a letter of credit. A breach of the other lease covenants gives rise to certain remedies by the landlord, the most severe of which include the termination of the applicable lease and acceleration of the total rent payments due under the lease. We have sold a number of dealerships to third parties and, as a condition to certain of those sales, remain liable for the lease payments relating to the properties on which those businesses operate in the event of non-payment by the buyer. We are also party to lease agreements on properties that we no longer use in our retail operations that we have sublet to third parties. We rely on subtenants to pay the rent and maintain the property at these locations. In the event the subtenant does not perform as expected, we may not be able to recover amounts owed to us and we could be required to fulfill these obligations. We currently hold a 23.4% ownership interest in PTL. Historically, affiliates of GE Capital (“GEC”) provided PTL with a majority of its financing, though PTL has refinanced all of its GEC indebtedness. As part of that refinancing, we and the other PTL partners created a new company (“Holdings”), which, together with GEC, co-issued $700.0 million of 3.8% senior unsecured notes due 2019 (the “Holdings Bonds”). GEC agreed to be a co-obligor of the Holdings Bonds in order to achieve lower interest rates on the Holdings Bonds. As part of Mitsui’s purchase of its 20.0% ownership interest in PTL in March 2015, the ownership interest of GEC in Holdings was redeemed, Holdings was relieved of its obligations under the indenture for the Holdings Bonds, and Holdings became obligated to pay to GEC 50.1% of all interest and principal due under, and 100% of the expenses related to, the Holdings Bonds to the extent Holdings has cash in excess of a certain level of permitted working capital, subject to certain limitations. Additional capital contributions from the members may be required to the extent Holdings is unable to pay those amounts. We have agreed to indemnify GEC for 9.0% of any principal or interest that GEC is required to pay on these bonds and pay GEC an annual fee of approximately $0.95 million for acting as obligor. The maximum amount of our contingent obligations to GEC under this agreement is 9.0% of the required principal repayment due in 2019 (which is expected to be $63.1 million) and 9.0% of interest payments under the Holdings Bonds, plus fees and default interest, if any. Our floor plan credit agreement with Mercedes Benz Financial Services Australia (“MBA”) provides us revolving loans for the acquisition of commercial vehicles for distribution to our retail network. This facility includes a limited parent guarantee and a commitment to repurchase dealer vehicles in the event the dealer’s floor plan agreement with MBA is terminated. We have $32.5 million of letters of credit outstanding as of June 30, 2017, and have posted $25.6 million of surety bonds in the ordinary course of business.

Equity

Equity	6 Months Ended
	Jun. 30, 2017
Equity
Equity	10. Equity During the six months ended June 30, 2017, we repurchased or acquired 183,710 shares of our common stock. In the first quarter of 2017, we repurchased 50,000 shares of our outstanding common stock for $2.7 million, or an average of $53.03 per share, under our securities repurchase program approved by our Board of Directors. During the second quarter of 2017, we did not repurchase any common stock under this program. As of June 30, 2017, our remaining authorization under the program was $29.5 million. During the second quarter of 2017, we acquired 133,710 shares of our common stock for $5.8 million, or an average of $43.28 per share, from employees in connection with a net share settlement feature of employee equity awards.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Income/(Loss)	6 Months Ended
	Jun. 30, 2017
Accumulated Other Comprehensive Income/(Loss)
Accumulated Other Comprehensive Income/(Loss)	11. Accumulated Other Comprehensive Income/(Loss) Changes in accumulated other comprehensive income/(loss) by component and the reclassifications out of accumulated other comprehensive income/(loss) during the three and six months ended June 30, 2017 and 2016, respectively, attributable to Penske Automotive Group common stockholders follows: Three Months Ended June 30, 2017 Foreign Currency Translation Other Total Balance at March 31, 2017 $ (205.7) $ (19.3) $ (225.0) Other comprehensive income (loss) before reclassifications 36.0 2.8 38.8 Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) 36.0 2.8 38.8 Balance at June 30, 2017 $ (169.7) $ (16.5) $ (186.2) Three Months Ended June 30, 2016 Foreign Currency Translation Other Total Balance at March 31, 2016 $ (114.6) $ (8.1) $ (122.7) Other comprehensive income (loss) before reclassifications (55.5) 0.6 (54.9) Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) (55.5) 0.6 (54.9) Balance at June 30, 2016 $ (170.1) $ (7.5) $ (177.6) Six Months Ended June 30, 2017 Foreign Currency Translation Other Total Balance at December 31, 2016 $ (230.0) $ (20.7) $ (250.7) Other comprehensive income (loss) before reclassifications 60.3 4.2 64.5 Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) 60.3 4.2 64.5 Balance at June 30, 2017 $ (169.7) $ (16.5) $ (186.2) Six Months Ended June 30, 2016 Foreign Currency Translation Other Total Balance at December 31, 2015 $ (113.5) $ (9.0) $ (122.5) Other comprehensive income (loss) before reclassifications (56.6) 1.5 (55.1) Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) (56.6) 1.5 (55.1) Balance at June 30, 2016 $ (170.1) $ (7.5) $ (177.6)

Segment Information

Segment Information	6 Months Ended
	Jun. 30, 2017
Segment Information
Segment Information	12. Segment Information Our operations are organized by management into operating segments by line of business and geography. We have determined that we have four reportable segments as defined in generally accepted accounting principles for segment reporting: (i) Retail Automotive, consisting of our retail automotive dealership operations; (ii) Retail Commercial Truck, consisting of our retail commercial truck dealership operations in the U.S. and Canada; (iii) Other, consisting of our commercial vehicle and power systems distribution operations and other non-automotive consolidated operations; and (iv) Non-Automotive Investments, consisting of our equity method investments in non-automotive operations. The Retail Automotive reportable segment includes all automotive dealerships and all departments relevant to the operation of the dealerships and our retail automotive joint ventures. The individual dealership operations included in the Retail Automotive reportable segment represent six operating segments: Eastern, Central, and Western United States, CarSense, International, and CarShop. These operating segments have been aggregated into one reportable segment as their operations (A) have similar economic characteristics (all are automotive dealerships having similar margins), (B) offer similar products and services (all sell new and/or used vehicles, service, parts and third-party finance and insurance products), (C) have similar target markets and customers (generally individuals) and (D) have similar distribution and marketing practices (all distribute products and services through dealership facilities that market to customers in similar fashions). Revenue and segment income for the three and six months ended June 30, 2017 and 2016 follows: Three Months Ended June 30 Retail Retail Commercial Non-Automotive Intersegment Automotive Truck Other Investments Elimination Total Revenues 2017 $ 5,040.7 $ 228.5 $ 114.2 $ — $ — $ 5,383.4 2016 4,836.8 309.5 108.5 — (0.7) 5,254.1 Segment income 2017 $ 120.8 $ 9.3 $ 1.6 $ 25.2 $ — $ 156.9 2016 123.1 7.6 2.3 10.5 — 143.5 Six Months Ended June 30 Retail Retail Commercial Non-Automotive Intersegment Automotive Truck Other Investments Elimination Total Revenues 2017 $ 9,797.1 $ 440.2 $ 227.2 $ — $ — $ 10,464.5 2016 9,349.7 516.2 214.5 — (1.7) 10,078.7 Segment income 2017 $ 225.6 $ 15.8 $ 2.5 $ 37.7 $ — $ 281.6 2016 233.5 13.4 1.6 14.6 — 263.1

Condensed Consolidating Financi

Condensed Consolidating Financial Information	6 Months Ended
	Jun. 30, 2017
Condensed Consolidating Financial Information
Condensed Consolidating Financial Information	13. Condensed Consolidating Financial Information The following tables include condensed consolidating financial information as of June 30, 2017 and December 31, 2016 and for the three and six month periods ended June 30, 2017 and 2016 for Penske Automotive Group, Inc. (as the issuer of the 5.75% Notes, the 5.375% Notes, and the 5.50% Notes), guarantor subsidiaries and non-guarantor subsidiaries (primarily representing non-U.S. entities). Guarantor subsidiaries are directly or indirectly 100% owned by PAG, and the guarantees are full and unconditional, and joint and several. The guarantees may be released under certain circumstances upon resale, or transfer by us of the stock of the related guarantor or all or substantially all of the assets of the guarantor to a non-affiliate. CONDENSED CONSOLIDATING BALANCE SHEET June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Cash and cash equivalents $ 20.7 $ — $ — $ 1.9 $ 18.8 Accounts receivable, net 827.7 (456.0) 456.0 392.1 435.6 Inventories 3,711.9 — — 1,944.9 1,767.0 Other current assets 104.2 — 7.5 19.2 77.5 Assets held for sale — — — — — Total current assets 4,664.5 (456.0) 463.5 2,358.1 2,298.9 Property and equipment, net 1,990.3 — 3.8 984.0 1,002.5 Intangible assets 2,109.0 — — 1,334.8 774.2 Equity method investments 921.5 — 856.6 — 64.9 Other long-term assets 26.6 (2,542.0) 2,547.5 4.3 16.8 Total assets $ 9,711.9 $ (2,998.0) $ 3,871.4 $ 4,681.2 $ 4,157.3 Floor plan notes payable $ 2,151.1 $ — $ — $ 1,126.0 $ 1,025.1 Floor plan notes payable — non-trade 1,364.7 — 185.6 678.9 500.2 Accounts payable 559.9 — 6.5 159.8 393.6 Accrued expenses 413.2 (456.0) 1.1 95.7 772.4 Current portion of long-term debt 70.1 — — 10.0 60.1 Liabilities held for sale 0.7 — — 0.7 — Total current liabilities 4,559.7 (456.0) 193.2 2,071.1 2,751.4 Long-term debt 1,955.8 (177.3) 1,661.5 192.7 278.9 Deferred tax liabilities 655.2 — — 649.4 5.8 Other long-term liabilities 524.5 — — 61.7 462.8 Total liabilities 7,695.2 (633.3) 1,854.7 2,974.9 3,498.9 Total equity 2,016.7 (2,364.7) 2,016.7 1,706.3 658.4 Total liabilities and equity $ 9,711.9 $ (2,998.0) $ 3,871.4 $ 4,681.2 $ 4,157.3 CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Cash and cash equivalents $ 24.0 $ — $ — $ 9.4 $ 14.6 Accounts receivable, net 879.0 (447.0) 447.0 483.6 395.4 Inventories 3,408.2 — — 1,830.5 1,577.7 Other current assets 73.9 — 14.3 14.6 45.0 Assets held for sale 8.4 — — 8.4 — Total current assets 4,393.5 (447.0) 461.3 2,346.5 2,032.7 Property and equipment, net 1,806.5 — 3.3 961.0 842.2 Intangible assets 1,711.3 — — 1,079.6 631.7 Equity method investments 893.4 — 833.7 — 59.7 Other long-term assets 28.3 (2,215.0) 2,220.6 4.1 18.6 Total assets $ 8,833.0 $ (2,662.0) $ 3,518.9 $ 4,391.2 $ 3,584.9 Floor plan notes payable $ 2,084.5 $ — $ — $ 1,178.0 $ 906.5 Floor plan notes payable — non-trade 1,233.3 — 156.0 623.2 454.1 Accounts payable 497.4 — 4.9 171.9 320.6 Accrued expenses 360.0 (447.0) 0.9 77.2 728.9 Current portion of long-term debt 48.3 — — 6.0 42.3 Liabilities held for sale 6.1 — — 6.1 — Total current liabilities 4,229.6 (447.0) 161.8 2,062.4 2,452.4 Long-term debt 1,828.8 (175.8) 1,577.6 186.0 241.0 Deferred tax liabilities 564.6 — — 560.9 3.7 Other long-term liabilities 430.5 — — 65.2 365.3 Total liabilities 7,053.5 (622.8) 1,739.4 2,874.5 3,062.4 Total equity 1,779.5 (2,039.2) 1,779.5 1,516.7 522.5 Total liabilities and equity $ 8,833.0 $ (2,662.0) $ 3,518.9 $ 4,391.2 $ 3,584.9 CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 5,383.4 $ — $ — $ 3,034.8 $ 2,348.6 Cost of sales 4,566.1 — — 2,550.4 2,015.7 Gross profit 817.3 — — 484.4 332.9 Selling, general and administrative expenses 622.0 — 6.2 344.5 271.3 Depreciation 23.3 — 0.4 13.2 9.7 Operating income 172.0 — (6.6) 126.7 51.9 Floor plan interest expense (15.5) — (1.1) (9.7) (4.7) Other interest expense (26.4) — (17.8) (2.2) (6.4) Equity in earnings of affiliates 26.8 — 25.2 — 1.6 Equity in earnings of subsidiaries — (156.6) 156.6 — — Income from continuing operations before income taxes 156.9 (156.6) 156.3 114.8 42.4 Income taxes (50.2) 50.3 (50.2) (41.2) (9.1) Income from continuing operations 106.7 (106.3) 106.1 73.6 33.3 Income (loss) from discontinued operations, net of tax 0.2 (0.2) 0.2 0.2 — Net income 106.9 (106.5) 106.3 73.8 33.3 Other comprehensive income (loss), net of tax 40.5 (37.6) 40.5 — 37.6 Comprehensive income 147.4 (144.1) 146.8 73.8 70.9 Less: Comprehensive income attributable to non-controlling interests 2.4 (1.6) 1.6 — 2.4 Comprehensive income attributable to Penske Automotive Group common stockholders $ 145.0 $ (142.5) $ 145.2 $ 73.8 $ 68.5 CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended June 30, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 5,254.1 $ — $ — $ 2,868.6 $ 2,385.5 Cost of sales 4,482.8 — — 2,429.3 2,053.5 Gross profit 771.3 — — 439.3 332.0 Selling, general and administrative expenses 582.7 — 5.2 326.3 251.2 Depreciation 24.5 — 0.4 11.7 12.4 Operating income 164.1 — (5.6) 101.3 68.4 Floor plan interest expense (13.1) — (0.5) (7.7) (4.9) Other interest expense (19.5) — (12.3) (1.9) (5.3) Equity in earnings of affiliates 12.0 — 10.5 — 1.5 Equity in earnings of subsidiaries — (149.9) 149.9 — — Income from continuing operations before income taxes 143.5 (149.9) 142.0 91.7 59.7 Income taxes (47.3) 49.9 (47.3) (36.7) (13.2) Income from continuing operations 96.2 (100.0) 94.7 55.0 46.5 (Loss) income from discontinued operations, net of tax (1.2) 1.2 (1.2) (1.2) — Net income 95.0 (98.8) 93.5 53.8 46.5 Other comprehensive income (loss), net of tax (55.5) 55.7 (55.5) — (55.7) Comprehensive income 39.5 (43.1) 38.0 53.8 (9.2) Less: Comprehensive income attributable to non-controlling interests 0.8 0.7 (0.7) 0.1 0.7 Comprehensive income attributable to Penske Automotive Group common stockholders $ 38.7 $ (43.8) $ 38.7 $ 53.7 $ (9.9) CONDENSED CONSOLIDATING STATEMENT OF INCOME Six Months Ended June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 10,464.5 $ — $ — $ 5,702.7 $ 4,761.8 Cost of sales 8,872.9 — — 4,781.6 4,091.3 Gross profit 1,591.6 — — 921.1 670.5 Selling, general and administrative expenses 1,223.7 — 12.2 682.9 528.6 Depreciation 45.7 — 0.8 25.9 19.0 Operating income 322.2 — (13.0) 212.3 122.9 Floor plan interest expense (29.2) — (2.1) (18.1) (9.0) Other interest expense (51.4) — (34.3) (4.3) (12.8) Equity in earnings of affiliates 40.0 — 37.7 — 2.3 Equity in earnings of subsidiaries — (292.3) 292.3 — — Income from continuing operations before income taxes 281.6 (292.3) 280.6 189.9 103.4 Income taxes (91.3) 95.2 (91.3) (73.8) (21.4) Income from continuing operations 190.3 (197.1) 189.3 116.1 82.0 (Loss) income from discontinued operations, net of tax (0.4) 0.4 (0.4) (0.4) — Net income 189.9 (196.7) 188.9 115.7 82.0 Other comprehensive income (loss), net of tax 66.6 (61.1) 66.6 — 61.1 Comprehensive income 256.5 (257.8) 255.5 115.7 143.1 Less: Comprehensive income attributable to non-controlling interests 3.2 (2.0) 2.0 — 3.2 Comprehensive income attributable to Penske Automotive Group common stockholders $ 253.3 $ (255.8) $ 253.5 $ 115.7 $ 139.9 CONDENSED CONSOLIDATING STATEMENT OF INCOME Six Months Ended June 30, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 10,078.7 $ — $ — $ 5,257.8 $ 4,820.9 Cost of sales 8,583.6 — — 4,435.5 4,148.1 Gross profit 1,495.1 — — 822.3 672.8 Selling, general and administrative expenses 1,141.6 — 11.3 622.1 508.2 Depreciation 45.3 — 0.8 22.5 22.0 Operating income 308.2 — (12.1) 177.7 142.6 Floor plan interest expense (25.9) — (1.3) (14.4) (10.2) Other interest expense (36.7) — (25.6) (0.6) (10.5) Equity in earnings of affiliates 17.5 — 14.7 — 2.8 Equity in earnings of subsidiaries — (285.0) 285.0 — — Income from continuing operations before income taxes 263.1 (285.0) 260.7 162.7 124.7 Income taxes (86.7) 94.7 (86.7) (65.9) (28.8) Income from continuing operations 176.4 (190.3) 174.0 96.8 95.9 (Loss) income from discontinued operations, net of tax (1.2) 1.3 (1.3) (1.1) (0.1) Net income 175.2 (189.0) 172.7 95.7 95.8 Other comprehensive income (loss), net of tax (54.3) 56.0 (54.3) — (56.0) Comprehensive income 120.9 (133.0) 118.4 95.7 39.8 Less: Comprehensive income attributable to non-controlling interests 3.2 (0.8) 0.8 0.1 3.1 Comprehensive income attributable to Penske Automotive Group common stockholders $ 117.7 $ (132.2) $ 117.6 $ 95.6 $ 36.7 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Group Subsidiaries Subsidiaries Net cash provided by (used in) continuing operating activities $ 320.5 $ (50.5) $ 252.6 $ 118.4 Investing activities: Purchase of equipment and improvements (113.4) (1.4) (49.4) (62.6) Acquisitions, net (431.9) — (316.9) (115.0) Other 15.0 6.0 9.0 — Net cash (used in) provided by continuing investing activities (530.3) 4.6 (357.3) (177.6) Financing activities: Net borrowings of long-term debt 137.9 83.0 10.8 44.1 Net borrowings of floor plan notes payable — non-trade 131.3 29.6 80.2 21.5 Repurchases of common stock (8.5) (8.5) — — Dividends (52.4) (52.4) — — Other (5.8) (5.8) — — Distributions from (to) parent — — 3.7 (3.7) Net cash provided by continuing financing activities 202.5 45.9 94.7 61.9 Net cash provided by discontinued operations 2.5 — 2.5 — Effect of exchange rate changes on cash and cash equivalents 1.5 — — 1.5 Net change in cash and cash equivalents (3.3) — (7.5) 4.2 Cash and cash equivalents, beginning of period 24.0 — 9.4 14.6 Cash and cash equivalents, end of period $ 20.7 $ — $ 1.9 $ 18.8 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Group Subsidiaries Subsidiaries Net cash provided by (used in) continuing operating activities $ 270.6 $ (84.0) $ 109.5 $ 245.1 Investing activities: Purchase of equipment and improvements (136.7) (0.4) (149.9) 13.6 Acquisitions, net (65.4) — (65.1) (0.3) Other (25.0) — 0.4 (25.4) Net cash used in continuing investing activities (227.1) (0.4) (214.6) (12.1) Financing activities: Issuance of 5.50% senior subordinated notes 500.0 500.0 — — Net (repayments) borrowings of long-term debt (99.1) (160.0) 36.9 24.0 Net (repayments) borrowings of floor plan notes payable — non-trade (163.0) (149.7) 209.3 (222.6) Payment of debt issuance costs (6.6) (6.6) — — Repurchases of common stock (173.6) (173.6) — — Dividends (46.4) (46.4) — — Other (15.9) (6.1) (5.2) (4.6) Distributions from (to) parent — 126.8 (125.0) (1.8) Net cash (used in) provided by continuing financing activities (4.6) 84.4 116.0 (205.0) Net cash provided by discontinued operations 2.9 — 0.3 2.6 Effect of exchange rate changes on cash and cash equivalents (6.7) — — (6.7) Net change in cash and cash equivalents 35.1 — 11.2 23.9 Cash and cash equivalents, beginning of period 62.4 — — 62.4 Cash and cash equivalents, end of period $ 97.5 $ — $ 11.2 $ 86.3

Interim Financial Statements (P

Interim Financial Statements (Policies)	6 Months Ended
	Jun. 30, 2017
Interim Financial Statements.
Basis of Presentation	Basis of Presentation The accompanying unaudited consolidated condensed financial statements of PAG have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of June 30, 2017 and December 31, 2016 and for the three and six month periods ended June 30, 2017 and 2016 is unaudited, but includes all adjustments which our management believes to be necessary for the fair presentation of results for the periods presented. The consolidated condensed financial statements for prior periods have been revised for entities that have been treated as discontinued operations, and results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with our audited financial statements for the year ended December 31, 2016, which are included as part of our Annual Report on Form 10-K.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers (Topic 606).” This ASU supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU No. 2014-09 will require an entity to recognize revenue when it transfers promised goods or services to customers using a five-step model that requires entities to exercise judgment when considering the terms of contracts with customers. In August 2015, the FASB issued ASU 2015-14 “Revenue from Contracts with Customers (Topic 606) — Deferral of the Effective Date” providing for a one-year deferral of the effective date of ASU 2014-09 and allowing for early adoption as of the original effective date. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2017, and interim periods within those annual periods. The FASB has since also issued additional ASUs containing various updates to Topic 606 which will all be adopted along with ASU 2014-09. These ASUs can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption, with early adoption permitted. We intend to adopt these ASUs on January 1, 2018. We have performed our preliminary assessment of the potential impact these accounting standard updates will have on our consolidated financial position, results of operations, and cash flows and have begun our documentation of the results of this assessment. Based on our assessment performed to date, we do not expect the adoption of these updates to have a material impact on our financial statements; however, we will be required to enhance our disclosures on revenue recognition upon adoption. We do not expect there to be a significant change in the timing of our revenue recognition, as we anticipate that our performance obligations under the new standard will be similar to those under existing guidance. Therefore, we expect to adopt using a cumulative-effect adjustment as of the date of adoption. We are also in the process of evaluating and documenting any changes in controls and procedures that may be necessary as part of our implementation of the new standards; however, we do not expect material changes. We will continue to assess the impact that these new standards will have our on our consolidated financial position, results of operations, and cash flows, throughout the remainder of 2017. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” Under ASU 2015-11, inventory that is measured using the first-in, first-out (FIFO), specific identification, or average cost methods should be measured at the lower of cost or net realizable value. This ASU does not impact inventory measurement under the last-in, first-out (LIFO) or retail inventory methods. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. The amendments from this update are to be applied prospectively. We adopted this ASU prospectively on the effective date of January 1, 2017. The adoption of this accounting standard update has not had a material impact on our consolidated financial position, results of operations, and cash flows. In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740) — Balance Sheet Classification of Deferred Taxes.” Under ASU 2015-17, entities are required to classify all deferred tax liabilities and assets as noncurrent in a classified statement of financial position. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. The amendments from this update are to be applied either prospectively or retrospectively. We adopted this ASU retrospectively on the effective date of January 1, 2017. Amounts reclassified from “Other current assets” to “Deferred tax liabilities” were $28.1 million as of December 31, 2016. Other than the revised presentation of our consolidated balance sheets, the adoption of this accounting standard update has not had a material impact on our consolidated financial position, results of operations, and cash flows. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” Under this new guidance, a company will now recognize most leases on its balance sheet as lease liabilities with corresponding right-of-use assets. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2018, and interim periods within those annual periods, with early adoption permitted. We intend to adopt this ASU on January 1, 2019. The amendments from this update are to be applied using a modified retrospective approach. The adoption of this ASU will result in a significant increase to our consolidated balance sheets for lease liabilities and right-of-use assets. We are currently evaluating the other effects the adoption of this ASU will have on our consolidated financial statements. We believe our current off-balance sheet leasing commitments are reflected in our credit rating. In March 2016, the FASB issued ASU No. 2016-09, “Compensation —Stock Compensation (Topic 718) — Improvement to Employee Share-Based Payment Accounting.” This ASU simplified several aspects of accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. This ASU was adopted on the effective date of January 1, 2017. As part of the adoption of this ASU, we have elected to record forfeitures as they occur. The amendments to timing of recognition of excess tax benefits, minimum statutory withholding requirements, and forfeitures were adopted using a modified retrospective approach. The cumulative-effect adjustment to retained earnings as of January 1, 2017 was not material. Amendments related to cash flow presentation of employee taxes paid was adopted retrospectively, with $6.1 million reclassified from operating activities to financing activities for the six months ended June 30, 2016. Amendments related to the recognition of excess tax benefits on the income statement and presentation of excess tax benefits on the statement of cash flows were adopted prospectively, and therefore, prior periods were not adjusted. The adoption of this accounting standard update has not had a material impact on our consolidated financial position, results of operations, and cash flows. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230) — Classification of Certain Cash Receipts and Cash Payments.” This ASU provides new guidance on eight specific cash flow issues related to how such cash receipts and cash payments should be presented in a statement of cash flows. For public companies, this ASU is effective for financial statements issued for annual periods beginning after December 15, 2017, and interim periods within those annual periods, with early adoption permitted. The amendments from this update are to be applied retrospectively. We intend to adopt this ASU on January 1, 2018. We do not expect the adoption of this accounting standard update to have a material impact on our consolidated cash flows.
Assets Held For Sale and Discontinued Operations	Assets Held for Sale and Discontinued Operations We classify an entity as held for sale in the period in which all of the following criteria are met: · management, having the authority to approve the action, commits to a plan to sell the entity; · the entity is available for immediate sale in its present condition; · an active program to locate a buyer and other actions required to complete the plan to sell have been initiated; · the sale is probable and transfer is expected to be completed within one year; · the entity is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and · actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. In April 2014, the FASB issued ASU No. 2014-08 that changed the definition of a discontinued operation to include only those disposals of components of an entity or components of an entity that are classified as held for sale that represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. We adopted this accounting standard update effective January 1, 2015. Prior to the adoption of ASU No. 2014-08, we accounted for dispositions as discontinued operations when it was evident that the operations and cash flows of an entity being disposed of would be eliminated from ongoing operations, and we would not have any significant continuing involvement in its operations. The results of operations for those entities that were classified as discontinued operations prior to adoption of ASU No. 2014-08 are included in “Income (loss) from discontinued operations” in the accompanying Consolidated Condensed Statements of Income for all periods presented and will continue to be reported within discontinued operations in the future. Beginning with disposals or entities classified as held for sale subsequent to January 1, 2015, only those that represent a strategic shift that has, or will have, a major impact on our operations and financial results will be included in discontinued operations. We had no entities newly classified as held for sale during the six months ended June 30, 2017 that met the criteria to be classified as discontinued operations. As such, the combined financial information presented below represents only retail automotive dealerships that were classified as discontinued operations prior to adoption of ASU No. 2014-08: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 Revenues $ — $ 5.6 $ 2.1 $ 14.0 Pre-tax gain (loss) 0.3 (2.0) (0.6) (2.0) June 30, December 31, 2017 2016 Inventories $ — $ 4.6 Other assets — 3.8 Total assets $ — $ 8.4 Floor plan notes payable (including non-trade) $ — $ 4.8 Other liabilities 0.7 1.3 Total liabilities $ 0.7 $ 6.1
Dispositions	Dispositions During the six months ended June 30, 2017, we disposed of nine retail automotive franchises. The results of operations for one of the retail automotive franchises is included in discontinued operations for the six months ended June 30, 2017 and for the three and six months ended June 30, 2016. The remaining eight retail automotive franchises did not meet the criteria to be classified as held for sale and treated as discontinued operations. Therefore, the results of operations for these businesses are included within continuing operations for the three and six months ended June 30, 2017 and 2016.
Estimates	Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets and certain reserves.
Fair Value of Financial Instruments	Fair Value of Financial Instruments 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 that 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 in active markets for identical assets or liabilities Level 2 Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted market prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities Our financial instruments consist of cash and cash equivalents, debt, floor plan notes payable, forward exchange contracts and interest rate swaps used to hedge future cash flows. Other than our fixed rate debt, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. Our fixed rate debt consists of amounts outstanding under our senior subordinated notes and mortgage facilities. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 2), and we estimate the fair value of our mortgage facilities using a present value technique based on current market interest rates for similar types of financial instruments (Level 2). A summary of the carrying values and fair values of our 5.75% senior subordinated notes, 5.375% senior subordinated notes, 5.50% senior subordinated notes, and our fixed rate mortgage facilities are as follows: June 30, 2017 December 31, 2016 Carrying Value Fair Value Carrying Value Fair Value 5.75% senior subordinated notes due 2022 $ 545.5 $ 562.1 $ 545.1 $ 567.6 5.375% senior subordinated notes due 2024 297.0 300.7 296.8 293.0 5.50% senior subordinated notes due 2026 494.1 493.1 493.7 489.4 Mortgage facilities 213.6 212.0 199.9 195.6

Interim Financial Statements (T

Interim Financial Statements (Tables)	6 Months Ended
	Jun. 30, 2017
Interim Financial Statements.
Combined financial information regarding entities accounted for as discontinued operations	Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 Revenues $ — $ 5.6 $ 2.1 $ 14.0 Pre-tax gain (loss) 0.3 (2.0) (0.6) (2.0) June 30, December 31, 2017 2016 Inventories $ — $ 4.6 Other assets — 3.8 Total assets $ — $ 8.4 Floor plan notes payable (including non-trade) $ — $ 4.8 Other liabilities 0.7 1.3 Total liabilities $ 0.7 $ 6.1
Summary of carrying values and fair values of senior subordinated notes and fixed rate mortgage facilities	June 30, 2017 December 31, 2016 Carrying Value Fair Value Carrying Value Fair Value 5.75% senior subordinated notes due 2022 $ 545.5 $ 562.1 $ 545.1 $ 567.6 5.375% senior subordinated notes due 2024 297.0 300.7 296.8 293.0 5.50% senior subordinated notes due 2026 494.1 493.1 493.7 489.4 Mortgage facilities 213.6 212.0 199.9 195.6

Inventories (Tables)

Inventories (Tables)	6 Months Ended
	Jun. 30, 2017
Inventories
Inventories	June 30, December 31, 2017 2016 Retail automotive dealership new vehicles $ 2,297.7 $ 2,153.0 Retail automotive dealership used vehicles 892.1 771.7 Retail automotive parts, accessories and other 127.3 119.1 Retail commercial truck dealership vehicles and parts 169.4 170.3 Commercial vehicle distribution vehicles and parts 225.4 194.1 Total inventories $ 3,711.9 $ 3,408.2

Business Combinations (Tables)

Business Combinations (Tables)	6 Months Ended
	Jun. 30, 2017
Business Combinations
Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed	June 30, 2017 2016 Accounts receivable $ 6.9 $ 3.9 Inventory 130.3 45.2 Other current assets 2.5 0.1 Property and equipment 12.8 0.6 Indefinite-lived intangibles 362.1 24.8 Other non-current assets 0.1 — Current liabilities (23.8) (9.2) Non-current liabilities (2.8) — Total consideration 488.1 65.4 Consideration transferred through common stock issuance (32.4) — Contingent consideration (20.0) — Seller financed/assumed debt (3.8) — Total cash used in acquisitions $ 431.9 $ 65.4
Summary of unaudited consolidated pro forma results of operations	Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 Revenues $ 5,383.4 $ 5,693.4 $ 10,595.7 $ 11,000.0 Income from continuing operations 106.0 101.5 191.2 188.1 Net income 106.2 100.3 190.8 186.9 Income from continuing operations per diluted common share $ 1.23 $ 1.19 $ 2.23 $ 2.17 Net income per diluted common share $ 1.23 $ 1.18 $ 2.22 $ 2.15

Intangible Assets (Tables)

Intangible Assets (Tables)	6 Months Ended
	Jun. 30, 2017
Intangible Assets
Summary of the changes in the carrying amount of goodwill and other indefinite-lived intangible assets	Other Indefinite- Lived Intangible Goodwill Assets Balance, January 1, 2017 $ 1,291.2 $ 420.1 Additions 322.5 39.6 Disposals (1.9) (1.5) Foreign currency translation 29.5 9.5 Balance, June 30, 2017 $ 1,641.3 $ 467.7

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
	Jun. 30, 2017
Earnings Per Share
Reconciliation of number of shares used in calculation of basic and diluted earning per share	Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Weighted average number of common shares outstanding 86,101,711 85,268,625 85,852,971 86,743,783 Effect of non-participatory equity compensation 40,000 36,000 40,000 36,000 Weighted average number of common shares outstanding, including effect of dilutive securities 86,141,711 85,304,625 85,892,971 86,779,783

Long-Term Debt (Tables)

Long-Term Debt (Tables)	6 Months Ended
	Jun. 30, 2017
Long-Term Debt
Long Term Debt	June 30, December 31, 2017 2016 U.S. credit agreement — revolving credit line $ 323.0 $ 240.0 U.K. credit agreement — revolving credit line 82.1 48.1 U.K. credit agreement — overdraft line of credit — 2.7 5.50% senior subordinated notes due 2026 494.1 493.7 5.375% senior subordinated notes due 2024 297.0 296.8 5.75% senior subordinated notes due 2022 545.5 545.1 Australia working capital loan agreement 35.6 24.7 Mortgage facilities 213.6 199.9 Other 35.0 26.1 Total long-term debt 2,025.9 1,877.1 Less: current portion (70.1) (48.3) Net long-term debt $ 1,955.8 $ 1,828.8

Accumulated Other Comprehensi29

Accumulated Other Comprehensive Income/(Loss) (Tables)	6 Months Ended
	Jun. 30, 2017
Accumulated Other Comprehensive Income/(Loss)
Schedule of the changes in accumulated other comprehensive income/(loss) by component and the reclassifications out of accumulated other comprehensive income/(loss) attributable to the entity's common stockholders	Three Months Ended June 30, 2017 Foreign Currency Translation Other Total Balance at March 31, 2017 $ (205.7) $ (19.3) $ (225.0) Other comprehensive income (loss) before reclassifications 36.0 2.8 38.8 Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) 36.0 2.8 38.8 Balance at June 30, 2017 $ (169.7) $ (16.5) $ (186.2) Three Months Ended June 30, 2016 Foreign Currency Translation Other Total Balance at March 31, 2016 $ (114.6) $ (8.1) $ (122.7) Other comprehensive income (loss) before reclassifications (55.5) 0.6 (54.9) Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) (55.5) 0.6 (54.9) Balance at June 30, 2016 $ (170.1) $ (7.5) $ (177.6) Six Months Ended June 30, 2017 Foreign Currency Translation Other Total Balance at December 31, 2016 $ (230.0) $ (20.7) $ (250.7) Other comprehensive income (loss) before reclassifications 60.3 4.2 64.5 Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) 60.3 4.2 64.5 Balance at June 30, 2017 $ (169.7) $ (16.5) $ (186.2) Six Months Ended June 30, 2016 Foreign Currency Translation Other Total Balance at December 31, 2015 $ (113.5) $ (9.0) $ (122.5) Other comprehensive income (loss) before reclassifications (56.6) 1.5 (55.1) Amounts reclassified from accumulated other comprehensive income — net of tax — — — Net current period other comprehensive income (loss) (56.6) 1.5 (55.1) Balance at June 30, 2016 $ (170.1) $ (7.5) $ (177.6)

Segment Information (Tables)

Segment Information (Tables)	6 Months Ended
	Jun. 30, 2017
Segment Information
Revenues and segment income by reportable segment	Three Months Ended June 30 Retail Retail Commercial Non-Automotive Intersegment Automotive Truck Other Investments Elimination Total Revenues 2017 $ 5,040.7 $ 228.5 $ 114.2 $ — $ — $ 5,383.4 2016 4,836.8 309.5 108.5 — (0.7) 5,254.1 Segment income 2017 $ 120.8 $ 9.3 $ 1.6 $ 25.2 $ — $ 156.9 2016 123.1 7.6 2.3 10.5 — 143.5 Six Months Ended June 30 Retail Retail Commercial Non-Automotive Intersegment Automotive Truck Other Investments Elimination Total Revenues 2017 $ 9,797.1 $ 440.2 $ 227.2 $ — $ — $ 10,464.5 2016 9,349.7 516.2 214.5 — (1.7) 10,078.7 Segment income 2017 $ 225.6 $ 15.8 $ 2.5 $ 37.7 $ — $ 281.6 2016 233.5 13.4 1.6 14.6 — 263.1

Condensed Consolidating Finan31

Condensed Consolidating Financial Information (Tables)	6 Months Ended
	Jun. 30, 2017
Condensed Consolidating Financial Information
CONDENSED CONSOLIDATING BALANCE SHEET	CONDENSED CONSOLIDATING BALANCE SHEET June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Cash and cash equivalents $ 20.7 $ — $ — $ 1.9 $ 18.8 Accounts receivable, net 827.7 (456.0) 456.0 392.1 435.6 Inventories 3,711.9 — — 1,944.9 1,767.0 Other current assets 104.2 — 7.5 19.2 77.5 Assets held for sale — — — — — Total current assets 4,664.5 (456.0) 463.5 2,358.1 2,298.9 Property and equipment, net 1,990.3 — 3.8 984.0 1,002.5 Intangible assets 2,109.0 — — 1,334.8 774.2 Equity method investments 921.5 — 856.6 — 64.9 Other long-term assets 26.6 (2,542.0) 2,547.5 4.3 16.8 Total assets $ 9,711.9 $ (2,998.0) $ 3,871.4 $ 4,681.2 $ 4,157.3 Floor plan notes payable $ 2,151.1 $ — $ — $ 1,126.0 $ 1,025.1 Floor plan notes payable — non-trade 1,364.7 — 185.6 678.9 500.2 Accounts payable 559.9 — 6.5 159.8 393.6 Accrued expenses 413.2 (456.0) 1.1 95.7 772.4 Current portion of long-term debt 70.1 — — 10.0 60.1 Liabilities held for sale 0.7 — — 0.7 — Total current liabilities 4,559.7 (456.0) 193.2 2,071.1 2,751.4 Long-term debt 1,955.8 (177.3) 1,661.5 192.7 278.9 Deferred tax liabilities 655.2 — — 649.4 5.8 Other long-term liabilities 524.5 — — 61.7 462.8 Total liabilities 7,695.2 (633.3) 1,854.7 2,974.9 3,498.9 Total equity 2,016.7 (2,364.7) 2,016.7 1,706.3 658.4 Total liabilities and equity $ 9,711.9 $ (2,998.0) $ 3,871.4 $ 4,681.2 $ 4,157.3 CONDENSED CONSOLIDATING BALANCE SHEET December 31, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Cash and cash equivalents $ 24.0 $ — $ — $ 9.4 $ 14.6 Accounts receivable, net 879.0 (447.0) 447.0 483.6 395.4 Inventories 3,408.2 — — 1,830.5 1,577.7 Other current assets 73.9 — 14.3 14.6 45.0 Assets held for sale 8.4 — — 8.4 — Total current assets 4,393.5 (447.0) 461.3 2,346.5 2,032.7 Property and equipment, net 1,806.5 — 3.3 961.0 842.2 Intangible assets 1,711.3 — — 1,079.6 631.7 Equity method investments 893.4 — 833.7 — 59.7 Other long-term assets 28.3 (2,215.0) 2,220.6 4.1 18.6 Total assets $ 8,833.0 $ (2,662.0) $ 3,518.9 $ 4,391.2 $ 3,584.9 Floor plan notes payable $ 2,084.5 $ — $ — $ 1,178.0 $ 906.5 Floor plan notes payable — non-trade 1,233.3 — 156.0 623.2 454.1 Accounts payable 497.4 — 4.9 171.9 320.6 Accrued expenses 360.0 (447.0) 0.9 77.2 728.9 Current portion of long-term debt 48.3 — — 6.0 42.3 Liabilities held for sale 6.1 — — 6.1 — Total current liabilities 4,229.6 (447.0) 161.8 2,062.4 2,452.4 Long-term debt 1,828.8 (175.8) 1,577.6 186.0 241.0 Deferred tax liabilities 564.6 — — 560.9 3.7 Other long-term liabilities 430.5 — — 65.2 365.3 Total liabilities 7,053.5 (622.8) 1,739.4 2,874.5 3,062.4 Total equity 1,779.5 (2,039.2) 1,779.5 1,516.7 522.5 Total liabilities and equity $ 8,833.0 $ (2,662.0) $ 3,518.9 $ 4,391.2 $ 3,584.9
CONDENSED CONSOLIDATING STATEMENT OF INCOME	CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 5,383.4 $ — $ — $ 3,034.8 $ 2,348.6 Cost of sales 4,566.1 — — 2,550.4 2,015.7 Gross profit 817.3 — — 484.4 332.9 Selling, general and administrative expenses 622.0 — 6.2 344.5 271.3 Depreciation 23.3 — 0.4 13.2 9.7 Operating income 172.0 — (6.6) 126.7 51.9 Floor plan interest expense (15.5) — (1.1) (9.7) (4.7) Other interest expense (26.4) — (17.8) (2.2) (6.4) Equity in earnings of affiliates 26.8 — 25.2 — 1.6 Equity in earnings of subsidiaries — (156.6) 156.6 — — Income from continuing operations before income taxes 156.9 (156.6) 156.3 114.8 42.4 Income taxes (50.2) 50.3 (50.2) (41.2) (9.1) Income from continuing operations 106.7 (106.3) 106.1 73.6 33.3 Income (loss) from discontinued operations, net of tax 0.2 (0.2) 0.2 0.2 — Net income 106.9 (106.5) 106.3 73.8 33.3 Other comprehensive income (loss), net of tax 40.5 (37.6) 40.5 — 37.6 Comprehensive income 147.4 (144.1) 146.8 73.8 70.9 Less: Comprehensive income attributable to non-controlling interests 2.4 (1.6) 1.6 — 2.4 Comprehensive income attributable to Penske Automotive Group common stockholders $ 145.0 $ (142.5) $ 145.2 $ 73.8 $ 68.5 CONDENSED CONSOLIDATING STATEMENT OF INCOME Three Months Ended June 30, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 5,254.1 $ — $ — $ 2,868.6 $ 2,385.5 Cost of sales 4,482.8 — — 2,429.3 2,053.5 Gross profit 771.3 — — 439.3 332.0 Selling, general and administrative expenses 582.7 — 5.2 326.3 251.2 Depreciation 24.5 — 0.4 11.7 12.4 Operating income 164.1 — (5.6) 101.3 68.4 Floor plan interest expense (13.1) — (0.5) (7.7) (4.9) Other interest expense (19.5) — (12.3) (1.9) (5.3) Equity in earnings of affiliates 12.0 — 10.5 — 1.5 Equity in earnings of subsidiaries — (149.9) 149.9 — — Income from continuing operations before income taxes 143.5 (149.9) 142.0 91.7 59.7 Income taxes (47.3) 49.9 (47.3) (36.7) (13.2) Income from continuing operations 96.2 (100.0) 94.7 55.0 46.5 (Loss) income from discontinued operations, net of tax (1.2) 1.2 (1.2) (1.2) — Net income 95.0 (98.8) 93.5 53.8 46.5 Other comprehensive income (loss), net of tax (55.5) 55.7 (55.5) — (55.7) Comprehensive income 39.5 (43.1) 38.0 53.8 (9.2) Less: Comprehensive income attributable to non-controlling interests 0.8 0.7 (0.7) 0.1 0.7 Comprehensive income attributable to Penske Automotive Group common stockholders $ 38.7 $ (43.8) $ 38.7 $ 53.7 $ (9.9) CONDENSED CONSOLIDATING STATEMENT OF INCOME Six Months Ended June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 10,464.5 $ — $ — $ 5,702.7 $ 4,761.8 Cost of sales 8,872.9 — — 4,781.6 4,091.3 Gross profit 1,591.6 — — 921.1 670.5 Selling, general and administrative expenses 1,223.7 — 12.2 682.9 528.6 Depreciation 45.7 — 0.8 25.9 19.0 Operating income 322.2 — (13.0) 212.3 122.9 Floor plan interest expense (29.2) — (2.1) (18.1) (9.0) Other interest expense (51.4) — (34.3) (4.3) (12.8) Equity in earnings of affiliates 40.0 — 37.7 — 2.3 Equity in earnings of subsidiaries — (292.3) 292.3 — — Income from continuing operations before income taxes 281.6 (292.3) 280.6 189.9 103.4 Income taxes (91.3) 95.2 (91.3) (73.8) (21.4) Income from continuing operations 190.3 (197.1) 189.3 116.1 82.0 (Loss) income from discontinued operations, net of tax (0.4) 0.4 (0.4) (0.4) — Net income 189.9 (196.7) 188.9 115.7 82.0 Other comprehensive income (loss), net of tax 66.6 (61.1) 66.6 — 61.1 Comprehensive income 256.5 (257.8) 255.5 115.7 143.1 Less: Comprehensive income attributable to non-controlling interests 3.2 (2.0) 2.0 — 3.2 Comprehensive income attributable to Penske Automotive Group common stockholders $ 253.3 $ (255.8) $ 253.5 $ 115.7 $ 139.9 CONDENSED CONSOLIDATING STATEMENT OF INCOME Six Months Ended June 30, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Eliminations Group Subsidiaries Subsidiaries Revenues $ 10,078.7 $ — $ — $ 5,257.8 $ 4,820.9 Cost of sales 8,583.6 — — 4,435.5 4,148.1 Gross profit 1,495.1 — — 822.3 672.8 Selling, general and administrative expenses 1,141.6 — 11.3 622.1 508.2 Depreciation 45.3 — 0.8 22.5 22.0 Operating income 308.2 — (12.1) 177.7 142.6 Floor plan interest expense (25.9) — (1.3) (14.4) (10.2) Other interest expense (36.7) — (25.6) (0.6) (10.5) Equity in earnings of affiliates 17.5 — 14.7 — 2.8 Equity in earnings of subsidiaries — (285.0) 285.0 — — Income from continuing operations before income taxes 263.1 (285.0) 260.7 162.7 124.7 Income taxes (86.7) 94.7 (86.7) (65.9) (28.8) Income from continuing operations 176.4 (190.3) 174.0 96.8 95.9 (Loss) income from discontinued operations, net of tax (1.2) 1.3 (1.3) (1.1) (0.1) Net income 175.2 (189.0) 172.7 95.7 95.8 Other comprehensive income (loss), net of tax (54.3) 56.0 (54.3) — (56.0) Comprehensive income 120.9 (133.0) 118.4 95.7 39.8 Less: Comprehensive income attributable to non-controlling interests 3.2 (0.8) 0.8 0.1 3.1 Comprehensive income attributable to Penske Automotive Group common stockholders $ 117.7 $ (132.2) $ 117.6 $ 95.6 $ 36.7
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS	CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2017 Penske Total Automotive Guarantor Non-Guarantor Company Group Subsidiaries Subsidiaries Net cash provided by (used in) continuing operating activities $ 320.5 $ (50.5) $ 252.6 $ 118.4 Investing activities: Purchase of equipment and improvements (113.4) (1.4) (49.4) (62.6) Acquisitions, net (431.9) — (316.9) (115.0) Other 15.0 6.0 9.0 — Net cash (used in) provided by continuing investing activities (530.3) 4.6 (357.3) (177.6) Financing activities: Net borrowings of long-term debt 137.9 83.0 10.8 44.1 Net borrowings of floor plan notes payable — non-trade 131.3 29.6 80.2 21.5 Repurchases of common stock (8.5) (8.5) — — Dividends (52.4) (52.4) — — Other (5.8) (5.8) — — Distributions from (to) parent — — 3.7 (3.7) Net cash provided by continuing financing activities 202.5 45.9 94.7 61.9 Net cash provided by discontinued operations 2.5 — 2.5 — Effect of exchange rate changes on cash and cash equivalents 1.5 — — 1.5 Net change in cash and cash equivalents (3.3) — (7.5) 4.2 Cash and cash equivalents, beginning of period 24.0 — 9.4 14.6 Cash and cash equivalents, end of period $ 20.7 $ — $ 1.9 $ 18.8 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS Six Months Ended June 30, 2016 Penske Total Automotive Guarantor Non-Guarantor Company Group Subsidiaries Subsidiaries Net cash provided by (used in) continuing operating activities $ 270.6 $ (84.0) $ 109.5 $ 245.1 Investing activities: Purchase of equipment and improvements (136.7) (0.4) (149.9) 13.6 Acquisitions, net (65.4) — (65.1) (0.3) Other (25.0) — 0.4 (25.4) Net cash used in continuing investing activities (227.1) (0.4) (214.6) (12.1) Financing activities: Issuance of 5.50% senior subordinated notes 500.0 500.0 — — Net (repayments) borrowings of long-term debt (99.1) (160.0) 36.9 24.0 Net (repayments) borrowings of floor plan notes payable — non-trade (163.0) (149.7) 209.3 (222.6) Payment of debt issuance costs (6.6) (6.6) — — Repurchases of common stock (173.6) (173.6) — — Dividends (46.4) (46.4) — — Other (15.9) (6.1) (5.2) (4.6) Distributions from (to) parent — 126.8 (125.0) (1.8) Net cash (used in) provided by continuing financing activities (4.6) 84.4 116.0 (205.0) Net cash provided by discontinued operations 2.9 — 0.3 2.6 Effect of exchange rate changes on cash and cash equivalents (6.7) — — (6.7) Net change in cash and cash equivalents 35.1 — 11.2 23.9 Cash and cash equivalents, beginning of period 62.4 — — 62.4 Cash and cash equivalents, end of period $ 97.5 $ — $ 11.2 $ 86.3

Interim Financial Statements -

Interim Financial Statements - Business Overview (Details) $ in Millions	Jun. 30, 2017item	Jul. 27, 2016USD ($)	Jul. 26, 2016	Dec. 31, 2016item	Apr. 30, 2016item	Jun. 30, 2017USD ($)item	Jun. 30, 2016USD ($)	Jun. 30, 2017USD ($)item	Jun. 30, 2016USD ($)	Dec. 31, 2016USD ($)
Interim Financial Statements
Total revenues | $						$ 5,383.4	$ 5,254.1	$ 10,464.5	$ 10,078.7
PTL
Interim Financial Statements
Ownership acquired (as a percent)		14.40%
Ownership interest in Penske Truck Leasing Co (as a percent)	23.40%		9.00%
Cost of acquisition | $		$ 498.5
CarSense
Interim Financial Statements
Number of retail locations acquired								5
CarShop
Interim Financial Statements
Number of retail locations acquired								5
Retail Automotive Dealership
Interim Financial Statements
Total number of owned and operated franchises	354					354		354
Number of owned and operated franchises in US	162					162		162
Number of owned and operated franchises outside US	192					192		192
Minimum number of vehicles retailed and wholesaled								315,200
Minimum number of vehicle brands offered								40
Number of acquired franchises								6
Number of franchises awarded to the reporting entity								2
Number of franchises disposed								9
Number of smart franchises disposed								5
Retail Automotive Dealership | CarSense
Interim Financial Statements
Number of retail locations acquired								5
Retail Automotive Dealership | CarShop
Interim Financial Statements
Number of retail locations acquired								5
Retail Commercial Truck Dealership
Interim Financial Statements
Number of operating locations								20
Number of full service retail locations operated								14
Number of retail locations acquired				2	4
Commercial Vehicle Distribution
Interim Financial Statements
Minimum number of dealership locations								70
Number of retail dealerships owned by the reporting entity								10
New Jersey | Retail Automotive Dealership
Interim Financial Statements
Number of acquired franchises								2
Arizona | Retail Automotive Dealership
Interim Financial Statements
Number of acquired franchises								2
Germany | Retail Automotive Dealership
Interim Financial Statements
Number of acquired franchises								2
Automotive dealership revenues | Geographic | U.S. and Puerto Rico
Interim Financial Statements
Automotive dealership revenue (as a percent)								58.00%
Automotive dealership revenues | Geographic | Outside the U.S.
Interim Financial Statements
Automotive dealership revenue (as a percent)								42.00%
Automotive dealership revenues | Premium brands
Interim Financial Statements
Automotive dealership revenue (as a percent)								70.00%
Penske Corporation | PTL
Interim Financial Statements
Ownership interest in Penske Truck Leasing Co (as a percent)	41.10%
Mitsui and Co | PTL
Interim Financial Statements
Ownership interest in Penske Truck Leasing Co (as a percent)	20.00%
GEC | PTL
Interim Financial Statements
Ownership interest in Penske Truck Leasing Co (as a percent)	15.50%
Retail Automotive Dealership
Interim Financial Statements
Total revenues | $						$ 5,040.7	4,836.8	$ 9,797.1	9,349.7	$ 18,700
Retail Commercial Truck Dealership
Interim Financial Statements
Total revenues | $						228.5	309.5	440.2	516.2
Commercial Vehicle Distribution and Other
Interim Financial Statements
Total revenues | $						$ 114.2	$ 107.8	$ 227.2	$ 212.8

Interim Financial Statements 33

Interim Financial Statements - Recent Accounting Pronouncements (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2017	Dec. 31, 2016
Recent Accounting Pronouncements
Decrease in other current assets due to reclassification related to ASU		$ (104.2)	$ (73.9)
Accounting Standards Update 2015-17
Recent Accounting Pronouncements
Decrease in other current assets due to reclassification related to ASU			28.1
Decrease in deferred tax liabilities due to reclassification related to ASU			$ 28.1
Accounting Standards Update 2016-09
Recent Accounting Pronouncements
Employee taxes paid related to share-based compensation, ASU reclassification adjustment to operating activities	$ 6.1
Employee taxes paid related to share-based compensation, ASU reclassification adjustment to financing activities	$ 6.1

Interim Financial Statements 34

Interim Financial Statements - Assets Held For Sale, Discontinued Operations and Fair Value (Details) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2017USD ($)item	Jun. 30, 2016USD ($)	Dec. 31, 2016USD ($)
Combined financial information regarding entities accounted for as discontinued operations
Number of entities newly classified as held for sale | item			0
Balance Sheet information regarding entities accounted for as discontinued operations
Total assets					$ 8.4
Total liabilities	$ 0.7		$ 0.7		6.1
Fair Value of Financial Instruments
Debt instrument, Carrying Value	$ 2,025.9		$ 2,025.9		$ 1,877.1
5.75% senior subordinated notes due 2022
Fair Value of Financial Instruments
Interest rate (as a percent)	5.75%		5.75%		5.75%
Debt instrument, Carrying Value	$ 545.5		$ 545.5		$ 545.1
5.75% senior subordinated notes due 2022 | Fair Value, Inputs, Level 2
Fair Value of Financial Instruments
Debt instrument, Fair Value	$ 562.1		$ 562.1		$ 567.6
5.375% Senior Subordinated Notes Due 2024
Fair Value of Financial Instruments
Interest rate (as a percent)	5.375%		5.375%		5.375%
Debt instrument, Carrying Value	$ 297		$ 297		$ 296.8
5.375% Senior Subordinated Notes Due 2024 | Fair Value, Inputs, Level 2
Fair Value of Financial Instruments
Debt instrument, Fair Value	$ 300.7		$ 300.7		$ 293
5.50% senior subordinated notes due 2026
Fair Value of Financial Instruments
Interest rate (as a percent)	5.50%		5.50%		5.50%
Debt instrument, Carrying Value	$ 494.1		$ 494.1		$ 493.7
5.50% senior subordinated notes due 2026 | Fair Value, Inputs, Level 2
Fair Value of Financial Instruments
Debt instrument, Fair Value	493.1		493.1		489.4
Mortgage facilities
Fair Value of Financial Instruments
Debt instrument, Carrying Value	213.6		213.6		199.9
Mortgage facilities | Fair Value, Inputs, Level 2
Fair Value of Financial Instruments
Debt instrument, Fair Value	212		$ 212		195.6
Retail Automotive Franchise
Divestitures
Number of franchises disposed | item			9
Retail Automotive Franchise | Disposed of by sale - Discontinued Operations
Divestitures
Number of franchises disposed | item			1
Retail Automotive Franchise | Disposal group, not discontinued operations
Divestitures
Number of franchises disposed | item			8
Retail Automotive Franchise | Held-for-sale
Combined financial information regarding entities accounted for as discontinued operations
Revenues		$ 5.6	$ 2.1	$ 14
Pre-tax gain (loss)	0.3	$ (2)	(0.6)	$ (2)
Balance Sheet information regarding entities accounted for as discontinued operations
Inventories					4.6
Other assets					3.8
Total assets					8.4
Floor plan notes payable (including non-trade)					4.8
Other liabilities	0.7		0.7		1.3
Total liabilities	$ 0.7		$ 0.7		$ 6.1

Inventories (Details)

Inventories (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Inventories
Retail automotive dealership new vehicles	$ 2,297.7		$ 2,297.7		$ 2,153
Retail automotive dealership used vehicles	892.1		892.1		771.7
Retail automotive parts, accessories and other	127.3		127.3		119.1
Retail commercial truck dealership vehicles and parts	169.4		169.4		170.3
Commercial vehicle distribution vehicles and parts	225.4		225.4		194.1
Total inventories	3,711.9		3,711.9		$ 3,408.2
Interest credits and advertising assistance	$ 10.6	$ 10.4	$ 20.7	$ 21.8

Business Combinations - Activit

Business Combinations - Activity (Details) - item	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
CarSense
Business combinations
Number of retail locations acquired	5
CarShop
Business combinations
Number of retail locations acquired	5
Retail Automotive Dealership
Business combinations
Number of acquired franchises	6	1
Retail Commercial Truck Dealership
Business combinations
Number of retail locations acquired		5

Business Combinations - Conside

Business Combinations - Consideration Paid and Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed
Accounts receivable	$ 6.9	$ 3.9
Inventory	130.3	45.2
Other current assets	2.5	0.1
Property and equipment	12.8	0.6
Indefinite-lived intangibles	362.1	24.8
Other non-current assets	0.1
Current liabilities	(23.8)	(9.2)
Non-current liabilities	(2.8)
Total consideration	488.1	65.4
Consideration transferred through common stock issuance	(32.4)
Contingent consideration	(20)
Seller financed/assumed debt	(3.8)
Total cash used in acquisitions	$ 431.9	$ 65.4

Business Combinations - Pro For

Business Combinations - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Summary of unaudited consolidated pro forma results of operations
Revenues	$ 5,383.4	$ 5,693.4	$ 10,595.7	$ 11,000
Income from continuing operations	106	101.5	191.2	188.1
Net income	$ 106.2	$ 100.3	$ 190.8	$ 186.9
Income from continuing operations per diluted common share (in dollars per share)	$ 1.23	$ 1.19	$ 2.23	$ 2.17
Net income per diluted common share (in dollars per share)	$ 1.23	$ 1.18	$ 2.22	$ 2.15

Intangible Assets - Summary of

Intangible Assets - Summary of Changes (Details) $ in Millions	6 Months Ended
	Jun. 30, 2017USD ($)
Summary of the changes in the carrying amount of goodwill and other indefinite-lived intangible assets
Goodwill, Beginning Balance	$ 1,291.2
Goodwill, Additions	322.5
Goodwill, Disposals	(1.9)
Goodwill, Foreign currency translation	29.5
Goodwill, Ending Balance	1,641.3
Other indefinite-lived intangible assets, Beginning Balance	420.1
Other indefinite-lived intangible assets, Additions	39.6
Other indefinite-lived intangible assets, Disposals	(1.5)
Other indefinite-lived intangible assets, Foreign currency translation	9.5
Other indefinite-lived intangible assets, Ending Balance	$ 467.7

Intangible Assets - Information

Intangible Assets - Information by Segment (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Intangible assets
Goodwill	$ 1,641.3	$ 1,291.2
Retail Automotive Dealership
Intangible assets
Goodwill	1,394.6
Retail Commercial Truck Dealership
Intangible assets
Goodwill	162.6
Other
Intangible assets
Goodwill	84.1
Non-Automotive Investments
Intangible assets
Goodwill	$ 0

Vehicle Financing (Details)

Vehicle Financing (Details)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Vehicle Financing
Maturity period of floor plan arrangements outside the U.S. if not payable on demand	90 days
Weighted average interest rate on floor plan borrowings (as a percent)	1.70%	1.60%

Earnings Per Share (Details)

Earnings Per Share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Reconciliation of number of shares used in calculation of basic and diluted earnings per share
Weighted average number of common shares outstanding	86,100,000	85,300,000	85,900,000	86,700,000
Effect of non-participatory equity compensation (in shares)	40,000	36,000	40,000	36,000
Weighted average number of common shares outstanding, including effect of dilutive securities	86,100,000	85,300,000	85,900,000	86,800,000

Long-Term Debt (Details)

Long-Term Debt (Details) £ in Millions, AUD in Millions, $ in Millions	1 Months Ended			6 Months Ended
	May 31, 2016USD ($)	Nov. 30, 2014USD ($)	Aug. 31, 2012USD ($)	Jun. 30, 2017GBP (£)	Jun. 30, 2017AUD	Jun. 30, 2017USD ($)	Dec. 31, 2016USD ($)
Long Term Debt
Total long-term debt						$ 2,025.9	$ 1,877.1
Less: current portion						(70.1)	(48.3)
Net long-term debt						1,955.8	1,828.8
US Credit Agreement Revolving Credit Line
Long Term Debt
Total long-term debt						323	240
Maximum credit available						700
Balance outstanding under credit agreement						323
Revolving loans solely for future U.S. acquisitions						250
Future borrowings available for foreign acquisitions						150
US Credit Agreement Revolving Credit Line | LIBOR portion
Long Term Debt
Base rate of interest on loans				LIBOR
Line of credit basis spread on variable rate (as a percent)				2.00%
Incremental interest rate for uncollateralized borrowings in excess of maximum limit (as a percent)				1.50%
UK Credit Agreement Revolving Credit Line
Long Term Debt
Total long-term debt						82.1	48.1
Maximum credit available | £				£ 150
UK Credit Agreement Revolving Credit Line | LIBOR portion
Long Term Debt
Base rate of interest on loans				LIBOR
UK Credit Agreement Revolving Credit Line | Minimum | LIBOR portion
Long Term Debt
Line of credit basis spread on variable rate (as a percent)				1.35%
UK Credit Agreement Revolving Credit Line | Maximum | LIBOR portion
Long Term Debt
Line of credit basis spread on variable rate (as a percent)				3.00%
UK Credit Agreement Overdraft Line of Credit
Long Term Debt
Total long-term debt							2.7
UK Credit Agreement Overdraft Line of Credit | Bank of England Base Rate
Long Term Debt
Base rate of interest on loans				Bank of England Base Rate
Line of credit basis spread on variable rate (as a percent)				1.75%
UK Credit Agreement Revolving Credit Line and Overdraft Line Of Credit
Long Term Debt
Balance outstanding under credit agreement				£ 63		82.1
5.50% senior subordinated notes due 2026
Long Term Debt
Total long-term debt						$ 494.1	$ 493.7
Interest rate (as a percent)				5.50%	5.50%	5.50%	5.50%
Debt issued	$ 500
Domestic Subsidiaries ownership guaranteeing obligations (as a percent)				100.00%	100.00%	100.00%
Change of control, redemption price as a percentage of principal	101.00%
Sale of assets, redemption price as percentage of principal	100.00%
5.50% senior subordinated notes due 2026 | Debt Redemption Prior to May 15, 2021
Long Term Debt
Percentage of principal amount at which the entity may redeem the notes				100.00%
5.50% senior subordinated notes due 2026 | Debt Redemption Prior to May 15, 2019
Long Term Debt
Specified equity offerings, percentage of debt which may be redeemed	40.00%
5.375% Senior Subordinated Notes Due 2024
Long Term Debt
Total long-term debt						$ 297	$ 296.8
Interest rate (as a percent)				5.375%	5.375%	5.375%	5.375%
Debt issued		$ 300
Domestic Subsidiaries ownership guaranteeing obligations (as a percent)				100.00%	100.00%	100.00%
Change of control, redemption price as a percentage of principal		101.00%
Sale of assets, redemption price as percentage of principal		100.00%
5.375% Senior Subordinated Notes Due 2024 | Debt Redemption Prior To December 1, 2019
Long Term Debt
Percentage of principal amount at which the entity may redeem the notes				100.00%
5.375% Senior Subordinated Notes Due 2024 | Maximum | Debt Redemption Prior To December 1, 2017
Long Term Debt
Specified equity offerings, percentage of debt which may be redeemed		40.00%
5.75% senior subordinated notes due 2022
Long Term Debt
Total long-term debt						$ 545.5	$ 545.1
Interest rate (as a percent)				5.75%	5.75%	5.75%	5.75%
Debt issued			$ 550
Domestic Subsidiaries ownership guaranteeing obligations (as a percent)				100.00%	100.00%	100.00%
Change of control, redemption price as a percentage of principal			101.00%
Sale of assets, redemption price as percentage of principal			100.00%
5.75% senior subordinated notes due 2022 | Debt Redemption Prior To October 1, 2017
Long Term Debt
Percentage of principal amount at which the entity may redeem the notes				100.00%
Australia Working Capital Loan Agreement
Long Term Debt
Total long-term debt						$ 35.6	$ 24.7
Maximum credit available | AUD					AUD 50.5
Balance outstanding under credit agreement					AUD 46.4	35.6
Australia Working Capital Loan Agreement | Australian BBSW 30-Day Bill Rate
Long Term Debt
Base rate of interest on loans				30-day Bill Rate
Line of credit basis spread on variable rate (as a percent)				2.35%
Mortgage facilities
Long Term Debt
Total long-term debt						213.6	199.9
Balance outstanding under credit agreement						213.6
Other Debt
Long Term Debt
Total long-term debt						$ 35	$ 26.1

Derivatives and Hedging (Detail

Derivatives and Hedging (Details) - Forward foreign exchange contracts - Fair Value, Inputs, Level 2 - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Derivative
Estimated liability of contracts designated as hedging instruments, fair value	$ 1
Estimated asset of contracts designated as hedging instruments, fair value		$ 0.3

Commitments and Contingent Li45

Commitments and Contingent Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jul. 26, 2016	Mar. 31, 2015	Jun. 30, 2017
Commitments and Contingent Liabilities
Lease period, minimum				5 years
Lease period, maximum				20 years
Loss Contingencies
Letters of credit outstanding	$ 32,500			$ 32,500
Surety bonds posted	25,600			25,600
Holdings | Holdings Bond
Loss Contingencies
Senior unsecured notes issued	$ 700,000			$ 700,000
Senior subordinated convertible notes, interest rate (as a percent)	3.80%			3.80%
Percentage of interest and principal due to the co-obligor as a result of the change in ownership and subsequent relief of debt obligation			50.10%
Percentage of expenses relating to the debt obligation due to the co-obligor as a result of the change in ownership and subsequent relief of debt obligation			100.00%
PTL
Loss Contingencies
Ownership interest in Penske Truck Leasing Co (as a percent)	23.40%	9.00%
GEC | PTL
Loss Contingencies
Ownership interest in Penske Truck Leasing Co (as a percent)	15.50%
Mitsui and Co
Loss Contingencies
Purchase of ownership interest			20.00%
Mitsui and Co | PTL
Loss Contingencies
Ownership interest in Penske Truck Leasing Co (as a percent)	20.00%
Penske Corporation | PTL
Loss Contingencies
Ownership interest in Penske Truck Leasing Co (as a percent)	41.10%
Guarantee of Indebtedness of Others | GEC
Loss Contingencies
Percentage of interest agreed to indemnify if GEC required to make any payments of principal or interest	9.00%			9.00%
Annual fee pay for acting as co-obligor	$ 950			$ 950
Value of principal repayment included in maximum amount of Company's potential obligations	$ 63,100			$ 63,100

Equity (Details)

Equity (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2017
Securities Repurchase Program
Repurchase of common stock			$ 8.5
Common Stock
Securities Repurchase Program
Repurchased shares			183,710
Common Stock | Acquired Employee Equity Awards
Securities Repurchase Program
Repurchased shares	133,710
Repurchase of common stock	$ 5.8
Repurchased shares, average price (in dollars per share)	$ 43.28
Common Stock | Share Repurchase Program
Securities Repurchase Program
Repurchased shares		50,000
Repurchase of common stock		$ 2.7
Repurchased shares, average price (in dollars per share)		$ 53.03
Amount authorized to be repurchased	$ 29.5		$ 29.5

Accumulated Other Comprehensi47

Accumulated Other Comprehensive Income/(Loss) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Changes in accumulated other comprehensive income (loss) by component
Balance at the beginning of the period			$ 1,750.9
Balance at the end of the period	$ 1,984.3		1,984.3
Foreign Currency Translation
Changes in accumulated other comprehensive income (loss) by component
Balance at the beginning of the period	(205.7)	$ (114.6)	(230)	$ (113.5)
Other comprehensive income (loss) before reclassifications	36	(55.5)	60.3	(56.6)
Net current period other comprehensive income (loss)	36	(55.5)	60.3	(56.6)
Balance at the end of the period	(169.7)	(170.1)	(169.7)	(170.1)
Other
Changes in accumulated other comprehensive income (loss) by component
Balance at the beginning of the period	(19.3)	(8.1)	(20.7)	(9)
Other comprehensive income (loss) before reclassifications	2.8	0.6	4.2	1.5
Net current period other comprehensive income (loss)	2.8	0.6	4.2	1.5
Balance at the end of the period	(16.5)	(7.5)	(16.5)	(7.5)
Accumulated Other Comprehensive Income (Loss)
Changes in accumulated other comprehensive income (loss) by component
Balance at the beginning of the period	(225)	(122.7)	(250.7)	(122.5)
Other comprehensive income (loss) before reclassifications	38.8	(54.9)	64.5	(55.1)
Net current period other comprehensive income (loss)	38.8	(54.9)	64.5	(55.1)
Balance at the end of the period	$ (186.2)	$ (177.6)	$ (186.2)	$ (177.6)

Segment Information (Details)

Segment Information (Details) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2017USD ($)item	Jun. 30, 2016USD ($)	Dec. 31, 2016USD ($)
Segment Reporting Information
Number of reportable Segments | item			4
Number of operating segments | item			6
Revenues and segment income by reportable segment
Revenues	$ 5,383.4	$ 5,254.1	$ 10,464.5	$ 10,078.7
Segment income	156.9	143.5	281.6	263.1
Intersegment Elimination
Revenues and segment income by reportable segment
Revenues		(0.7)		(1.7)
Retail Automotive Dealership
Revenues and segment income by reportable segment
Revenues	5,040.7	4,836.8	9,797.1	9,349.7	$ 18,700
Retail Automotive Dealership | Operating segments
Revenues and segment income by reportable segment
Revenues	5,040.7	4,836.8	9,797.1	9,349.7
Segment income	120.8	123.1	225.6	233.5
Retail Commercial Truck Dealership
Revenues and segment income by reportable segment
Revenues	228.5	309.5	440.2	516.2
Retail Commercial Truck Dealership | Operating segments
Revenues and segment income by reportable segment
Revenues	228.5	309.5	440.2	516.2
Segment income	9.3	7.6	15.8	13.4
Other | Operating segments
Revenues and segment income by reportable segment
Revenues	114.2	108.5	227.2	214.5
Segment income	1.6	2.3	2.5	1.6
Non-Automotive Investments | Operating segments
Revenues and segment income by reportable segment
Segment income	$ 25.2	$ 10.5	$ 37.7	$ 14.6

Condensed Consolidating Finan49

Condensed Consolidating Financial Information - Balance Sheet (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Condensed consolidating balance sheet
Cash and cash equivalents	$ 20.7	$ 24	$ 97.5	$ 62.4
Accounts receivable, net	827.7	879
Inventories	3,711.9	3,408.2
Other current assets	104.2	73.9
Assets held for sale		8.4
Total current assets	4,664.5	4,393.5
Property and equipment, net	1,990.3	1,806.5
Intangible assets	2,109	1,711.3
Equity method investments	921.5	893.4
Other long-term assets	26.6	28.3
Total assets	9,711.9	8,833
Floor plan notes payable	2,151.1	2,084.5
Floor plan notes payable - non-trade	1,364.7	1,233.3
Accounts payable	559.9	497.4
Accrued expenses	413.2	360
Current portion of long-term debt	70.1	48.3
Liabilities held for sale	0.7	6.1
Total current liabilities	4,559.7	4,229.6
Long-term debt	1,955.8	1,828.8
Deferred tax liabilities	655.2	564.6
Other long-term liabilities	524.5	430.5
Total liabilities	7,695.2	7,053.5
Total equity	2,016.7	1,779.5
Total liabilities and equity	$ 9,711.9	$ 8,833
5.75% senior subordinated notes due 2022
Condensed consolidating balance sheet
Interest rate (as a percent)	5.75%	5.75%
Domestic Subsidiaries ownership guaranteeing obligations (as a percent)	100.00%
5.375% Senior Subordinated Notes Due 2024
Condensed consolidating balance sheet
Interest rate (as a percent)	5.375%	5.375%
Domestic Subsidiaries ownership guaranteeing obligations (as a percent)	100.00%
5.50% senior subordinated notes due 2026
Condensed consolidating balance sheet
Interest rate (as a percent)	5.50%	5.50%
Domestic Subsidiaries ownership guaranteeing obligations (as a percent)	100.00%
Eliminations
Condensed consolidating balance sheet
Accounts receivable, net	$ (456)	$ (447)
Total current assets	(456)	(447)
Other long-term assets	(2,542)	(2,215)
Total assets	(2,998)	(2,662)
Accrued expenses	(456)	(447)
Total current liabilities	(456)	(447)
Long-term debt	(177.3)	(175.8)
Total liabilities	(633.3)	(622.8)
Total equity	(2,364.7)	(2,039.2)
Total liabilities and equity	(2,998)	(2,662)
Reportable legal entities | Penske Automotive Group
Condensed consolidating balance sheet
Accounts receivable, net	456	447
Other current assets	7.5	14.3
Total current assets	463.5	461.3
Property and equipment, net	3.8	3.3
Equity method investments	856.6	833.7
Other long-term assets	2,547.5	2,220.6
Total assets	3,871.4	3,518.9
Floor plan notes payable - non-trade	185.6	156
Accounts payable	6.5	4.9
Accrued expenses	1.1	0.9
Total current liabilities	193.2	161.8
Long-term debt	1,661.5	1,577.6
Total liabilities	1,854.7	1,739.4
Total equity	2,016.7	1,779.5
Total liabilities and equity	3,871.4	3,518.9
Reportable legal entities | Guarantor Subsidiaries
Condensed consolidating balance sheet
Cash and cash equivalents	1.9	9.4	11.2
Accounts receivable, net	392.1	483.6
Inventories	1,944.9	1,830.5
Other current assets	19.2	14.6
Assets held for sale		8.4
Total current assets	2,358.1	2,346.5
Property and equipment, net	984	961
Intangible assets	1,334.8	1,079.6
Other long-term assets	4.3	4.1
Total assets	4,681.2	4,391.2
Floor plan notes payable	1,126	1,178
Floor plan notes payable - non-trade	678.9	623.2
Accounts payable	159.8	171.9
Accrued expenses	95.7	77.2
Current portion of long-term debt	10	6
Liabilities held for sale	0.7	6.1
Total current liabilities	2,071.1	2,062.4
Long-term debt	192.7	186
Deferred tax liabilities	649.4	560.9
Other long-term liabilities	61.7	65.2
Total liabilities	2,974.9	2,874.5
Total equity	1,706.3	1,516.7
Total liabilities and equity	4,681.2	4,391.2
Reportable legal entities | Non-Guarantor Subsidiaries
Condensed consolidating balance sheet
Cash and cash equivalents	18.8	14.6	$ 86.3	$ 62.4
Accounts receivable, net	435.6	395.4
Inventories	1,767	1,577.7
Other current assets	77.5	45
Total current assets	2,298.9	2,032.7
Property and equipment, net	1,002.5	842.2
Intangible assets	774.2	631.7
Equity method investments	64.9	59.7
Other long-term assets	16.8	18.6
Total assets	4,157.3	3,584.9
Floor plan notes payable	1,025.1	906.5
Floor plan notes payable - non-trade	500.2	454.1
Accounts payable	393.6	320.6
Accrued expenses	772.4	728.9
Current portion of long-term debt	60.1	42.3
Total current liabilities	2,751.4	2,452.4
Long-term debt	278.9	241
Deferred tax liabilities	5.8	3.7
Other long-term liabilities	462.8	365.3
Total liabilities	3,498.9	3,062.4
Total equity	658.4	522.5
Total liabilities and equity	$ 4,157.3	$ 3,584.9

Condensed Consolidating Finan50

Condensed Consolidating Financial Information - Statement of Income (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Condensed consolidating statement of income
Revenues	$ 5,383.4	$ 5,254.1	$ 10,464.5	$ 10,078.7
Cost of sales	4,566.1	4,482.8	8,872.9	8,583.6
Gross profit	817.3	771.3	1,591.6	1,495.1
Selling, general and administrative expenses	622	582.7	1,223.7	1,141.6
Depreciation	23.3	24.5	45.7	45.3
Operating income	172	164.1	322.2	308.2
Floor plan interest expense	(15.5)	(13.1)	(29.2)	(25.9)
Other interest expense	(26.4)	(19.5)	(51.4)	(36.7)
Equity in earnings of affiliates	26.8	12	40	17.5
Income from continuing operations before income taxes	156.9	143.5	281.6	263.1
Income taxes	(50.2)	(47.3)	(91.3)	(86.7)
Income from continuing operations	106.7	96.2	190.3	176.4
Income (loss) from discontinued operations, net of tax	0.2	(1.2)	(0.4)	(1.2)
Net income	106.9	95	189.9	175.2
Other comprehensive income (loss), net of tax	40.5	(55.5)	66.6	(54.3)
Comprehensive income	147.4	39.5	256.5	120.9
Less: Comprehensive income attributable to non-controlling interests	2.4	0.8	3.2	3.2
Comprehensive income attributable to Penske Automotive Group common stockholders	145	38.7	253.3	117.7
Eliminations
Condensed consolidating statement of income
Equity in earnings of subsidiaries	(156.6)	(149.9)	(292.3)	(285)
Income from continuing operations before income taxes	(156.6)	(149.9)	(292.3)	(285)
Income taxes	50.3	49.9	95.2	94.7
Income from continuing operations	(106.3)	(100)	(197.1)	(190.3)
Income (loss) from discontinued operations, net of tax	(0.2)	1.2	0.4	1.3
Net income	(106.5)	(98.8)	(196.7)	(189)
Other comprehensive income (loss), net of tax	(37.6)	55.7	(61.1)	56
Comprehensive income	(144.1)	(43.1)	(257.8)	(133)
Less: Comprehensive income attributable to non-controlling interests	(1.6)	0.7	(2)	(0.8)
Comprehensive income attributable to Penske Automotive Group common stockholders	(142.5)	(43.8)	(255.8)	(132.2)
Reportable legal entities | Penske Automotive Group
Condensed consolidating statement of income
Selling, general and administrative expenses	6.2	5.2	12.2	11.3
Depreciation	0.4	0.4	0.8	0.8
Operating income	(6.6)	(5.6)	(13)	(12.1)
Floor plan interest expense	(1.1)	(0.5)	(2.1)	(1.3)
Other interest expense	(17.8)	(12.3)	(34.3)	(25.6)
Equity in earnings of affiliates	25.2	10.5	37.7	14.7
Equity in earnings of subsidiaries	156.6	149.9	292.3	285
Income from continuing operations before income taxes	156.3	142	280.6	260.7
Income taxes	(50.2)	(47.3)	(91.3)	(86.7)
Income from continuing operations	106.1	94.7	189.3	174
Income (loss) from discontinued operations, net of tax	0.2	(1.2)	(0.4)	(1.3)
Net income	106.3	93.5	188.9	172.7
Other comprehensive income (loss), net of tax	40.5	(55.5)	66.6	(54.3)
Comprehensive income	146.8	38	255.5	118.4
Less: Comprehensive income attributable to non-controlling interests	1.6	(0.7)	2	0.8
Comprehensive income attributable to Penske Automotive Group common stockholders	145.2	38.7	253.5	117.6
Reportable legal entities | Guarantor Subsidiaries
Condensed consolidating statement of income
Revenues	3,034.8	2,868.6	5,702.7	5,257.8
Cost of sales	2,550.4	2,429.3	4,781.6	4,435.5
Gross profit	484.4	439.3	921.1	822.3
Selling, general and administrative expenses	344.5	326.3	682.9	622.1
Depreciation	13.2	11.7	25.9	22.5
Operating income	126.7	101.3	212.3	177.7
Floor plan interest expense	(9.7)	(7.7)	(18.1)	(14.4)
Other interest expense	(2.2)	(1.9)	(4.3)	(0.6)
Income from continuing operations before income taxes	114.8	91.7	189.9	162.7
Income taxes	(41.2)	(36.7)	(73.8)	(65.9)
Income from continuing operations	73.6	55	116.1	96.8
Income (loss) from discontinued operations, net of tax	0.2	(1.2)	(0.4)	(1.1)
Net income	73.8	53.8	115.7	95.7
Comprehensive income	73.8	53.8	115.7	95.7
Less: Comprehensive income attributable to non-controlling interests		0.1		0.1
Comprehensive income attributable to Penske Automotive Group common stockholders	73.8	53.7	115.7	95.6
Reportable legal entities | Non-Guarantor Subsidiaries
Condensed consolidating statement of income
Revenues	2,348.6	2,385.5	4,761.8	4,820.9
Cost of sales	2,015.7	2,053.5	4,091.3	4,148.1
Gross profit	332.9	332	670.5	672.8
Selling, general and administrative expenses	271.3	251.2	528.6	508.2
Depreciation	9.7	12.4	19	22
Operating income	51.9	68.4	122.9	142.6
Floor plan interest expense	(4.7)	(4.9)	(9)	(10.2)
Other interest expense	(6.4)	(5.3)	(12.8)	(10.5)
Equity in earnings of affiliates	1.6	1.5	2.3	2.8
Income from continuing operations before income taxes	42.4	59.7	103.4	124.7
Income taxes	(9.1)	(13.2)	(21.4)	(28.8)
Income from continuing operations	33.3	46.5	82	95.9
Income (loss) from discontinued operations, net of tax				(0.1)
Net income	33.3	46.5	82	95.8
Other comprehensive income (loss), net of tax	37.6	(55.7)	61.1	(56)
Comprehensive income	70.9	(9.2)	143.1	39.8
Less: Comprehensive income attributable to non-controlling interests	2.4	0.7	3.2	3.1
Comprehensive income attributable to Penske Automotive Group common stockholders	$ 68.5	$ (9.9)	$ 139.9	$ 36.7

Condensed Consolidating Finan51

Condensed Consolidating Financial Information - Statement of Cash Flows (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Condensed consolidating statement of cash flows
Net cash provided by (used in) continuing operating activities	$ 320.5	$ 270.6
Investing activities:
Purchase of equipment and improvements	(113.4)	(136.7)
Acquisitions, net	(431.9)	(65.4)
Other	15	(25)
Net cash used in continuing investing activities	(530.3)	(227.1)
Financing activities:
Issuance of 5.50% senior subordinated notes		500
Net borrowings of long-term debt	137.9	(99.1)
Net borrowings (repayments) of floor plan notes payable—non-trade	131.3	(163)
Payment of debt issuance costs		(6.6)
Repurchases of common stock	(8.5)	(173.6)
Dividends	(52.4)	(46.4)
Other	(5.8)	(15.9)
Net cash provided by (used in) continuing financing activities	202.5	(4.6)
Net cash provided by discontinued operations	2.5	2.9
Effect of exchange rate changes on cash and cash equivalents	1.5	(6.7)
Net change in cash and cash equivalents	(3.3)	35.1
Cash and cash equivalents, beginning of period	24	62.4
Cash and cash equivalents, end of period	20.7	97.5
Reportable legal entities | Penske Automotive Group
Condensed consolidating statement of cash flows
Net cash provided by (used in) continuing operating activities	(50.5)	(84)
Investing activities:
Purchase of equipment and improvements	(1.4)	(0.4)
Other	6
Net cash used in continuing investing activities	4.6	(0.4)
Financing activities:
Issuance of 5.50% senior subordinated notes		500
Net borrowings of long-term debt	83	(160)
Net borrowings (repayments) of floor plan notes payable—non-trade	29.6	(149.7)
Payment of debt issuance costs		(6.6)
Repurchases of common stock	(8.5)	(173.6)
Dividends	(52.4)	(46.4)
Other	(5.8)	(6.1)
Distributions from (to) parent		126.8
Net cash provided by (used in) continuing financing activities	45.9	84.4
Reportable legal entities | Guarantor Subsidiaries
Condensed consolidating statement of cash flows
Net cash provided by (used in) continuing operating activities	252.6	109.5
Investing activities:
Purchase of equipment and improvements	(49.4)	(149.9)
Acquisitions, net	(316.9)	(65.1)
Other	9	0.4
Net cash used in continuing investing activities	(357.3)	(214.6)
Financing activities:
Net borrowings of long-term debt	10.8	36.9
Net borrowings (repayments) of floor plan notes payable—non-trade	80.2	209.3
Other		(5.2)
Distributions from (to) parent	3.7	(125)
Net cash provided by (used in) continuing financing activities	94.7	116
Net cash provided by discontinued operations	2.5	0.3
Net change in cash and cash equivalents	(7.5)	11.2
Cash and cash equivalents, beginning of period	9.4
Cash and cash equivalents, end of period	1.9	11.2
Reportable legal entities | Non-Guarantor Subsidiaries
Condensed consolidating statement of cash flows
Net cash provided by (used in) continuing operating activities	118.4	245.1
Investing activities:
Purchase of equipment and improvements	(62.6)	13.6
Acquisitions, net	(115)	(0.3)
Other		(25.4)
Net cash used in continuing investing activities	(177.6)	(12.1)
Financing activities:
Net borrowings of long-term debt	44.1	24
Net borrowings (repayments) of floor plan notes payable—non-trade	21.5	(222.6)
Other		(4.6)
Distributions from (to) parent	(3.7)	(1.8)
Net cash provided by (used in) continuing financing activities	61.9	(205)
Net cash provided by discontinued operations		2.6
Effect of exchange rate changes on cash and cash equivalents	1.5	(6.7)
Net change in cash and cash equivalents	4.2	23.9
Cash and cash equivalents, beginning of period	14.6	62.4
Cash and cash equivalents, end of period	$ 18.8	$ 86.3