Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 16, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-42002 | |
Entity Registrant Name | LKQ CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-4215970 | |
Entity Address, Address Line One | 500 West Madison Street | |
Entity Address, Address Line Two | Suite 2800 | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60661 | |
City Area Code | 312 | |
Local Phone Number | 621-1950 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 266,775,849 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001065696 | |
Current Fiscal Year End Date | --12-31 | |
Common stock, par value $.01 per share | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | LKQ | |
Security Exchange Name | NASDAQ | |
Euro Notes (2031) | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | 4.125% Notes due 2031 | |
Trading Symbol | LKQ31 | |
Security Exchange Name | NASDAQ |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Revenue | $ 3,703 | $ 3,349 |
Cost of goods sold | 2,251 | 1,977 |
Gross margin | 1,452 | 1,372 |
Selling, general and administrative expenses | 1,044 | 931 |
Restructuring and transaction related expenses | 30 | 18 |
Depreciation and amortization | 89 | 58 |
Operating income | 289 | 365 |
Other expense (income): | ||
Interest expense | 64 | 36 |
Interest income and other income, net | (6) | (9) |
Total other expense, net | 58 | 4 |
Income before provision for income taxes | 231 | 361 |
Provision for income taxes | 71 | 94 |
Equity in (losses) earnings of unconsolidated subsidiaries | (2) | 3 |
Net income | $ 158 | $ 270 |
Earnings per share: | ||
Basic | $ 0.59 | $ 1.01 |
Diluted | $ 0.59 | $ 1.01 |
Forward Contracts | ||
Gains on foreign exchange contracts - acquisition related (1) | $ 0 | $ (23) |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 158 | $ 270 |
Other comprehensive income (loss): | ||
Foreign currency translation, net of tax | (57) | 57 |
Net change in unrealized gains/losses on cash flow hedges, net of tax | 4 | (17) |
Other comprehensive (loss) income from unconsolidated subsidiaries | (5) | 3 |
Other comprehensive (loss) income | (58) | 43 |
Comprehensive income | $ 100 | $ 313 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) shares in Millions, $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 344 | $ 299 |
Receivables, net of allowance for credit losses | 1,392 | 1,165 |
Inventories | 3,123 | 3,121 |
Prepaid expenses and other current assets | 343 | 283 |
Total current assets | 5,202 | 4,868 |
Property, plant and equipment, net | 1,493 | 1,516 |
Operating lease assets, net | 1,314 | 1,336 |
Goodwill | 5,526 | 5,600 |
Other intangibles, net | 1,271 | 1,313 |
Equity method investments | 163 | 159 |
Other noncurrent assets | 301 | 287 |
Total assets | 15,270 | 15,079 |
Current liabilities: | ||
Accounts payable | 1,840 | 1,648 |
Accrued expenses: | ||
Accrued payroll-related liabilities | 242 | 260 |
Refund liability | 137 | 132 |
Other accrued expenses | 354 | 309 |
Current portion of operating lease liabilities | 226 | 224 |
Current portion of long-term obligations | 88 | 596 |
Other current liabilities | 172 | 149 |
Total current liabilities | 3,059 | 3,318 |
Long-term operating lease liabilities, excluding current portion | 1,138 | 1,163 |
Long-term obligations, excluding current portion | 4,161 | 3,655 |
Deferred income taxes | 426 | 448 |
Other noncurrent liabilities | $ 313 | $ 314 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | |
Common Stock, Shares Authorized | 1,000 | |
Common Stock, Shares, Issued | 323.5 | 323.1 |
Common Stock, Shares, Outstanding | 267 | 267.2 |
Stockholders' equity: | ||
Common stock, $0.01 par value, 1,000.0 shares authorized, 323.5 shares issued and 267.0 shares outstanding at March 31, 2024; 323.1 shares issued and 267.2 shares outstanding at December 31, 2023 | $ 3 | $ 3 |
Additional paid-in capital | 1,541 | 1,538 |
Retained earnings | 7,367 | 7,290 |
Accumulated other comprehensive loss | $ (298) | $ (240) |
Treasury Stock, Common, Shares | 56.5 | 55.9 |
Treasury stock, at cost; 56.5 shares at March 31, 2024 and 55.9 shares at December 31, 2023 | $ (2,454) | $ (2,424) |
Total Company stockholders' equity | 6,159 | 6,167 |
Noncontrolling interest | 14 | 14 |
Total stockholders' equity | 6,173 | 6,181 |
Total liabilities and stockholders' equity | $ 15,270 | $ 15,079 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | |
Common Stock, Shares Authorized | 1,000 | |
Common Stock, Shares, Issued | 323.5 | 323.1 |
Common Stock, Shares, Outstanding | 267 | 267.2 |
Treasury Stock, Common, Shares | 56.5 | 55.9 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 158 | $ 270 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 100 | 65 |
Stock-based compensation expense | 8 | 10 |
Other | 33 | 11 |
Changes in operating assets and liabilities, net of effects from acquisitions and dispositions: | ||
Receivables | (249) | (236) |
Inventories | (52) | 57 |
Prepaid income taxes/income taxes payable | 47 | 52 |
Accounts payable | 220 | 22 |
Other operating assets and liabilities | (12) | (5) |
Net cash provided by operating activities | 253 | 223 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property, plant and equipment | (66) | (70) |
Acquisitions, net of cash acquired | (17) | (25) |
Other investing activities, net | (5) | (2) |
Net cash used in investing activities | (88) | (97) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Debt issuance costs | (6) | (19) |
Borrowings under revolving credit facilities | 392 | 1,543 |
Repayments under revolving credit facilities | (659) | (2,003) |
Borrowings under term loans | 0 | 500 |
Borrowings of other debt, net | 33 | 1 |
Dividends paid to LKQ stockholders | (81) | (74) |
Purchase of treasury stock | (30) | (8) |
Other financing activities, net | (31) | (6) |
Net cash used in financing activities | (113) | (66) |
Effect of exchange rate changes on cash and cash equivalents | (7) | 4 |
Net increase in cash and cash equivalents | 45 | 64 |
Cash and cash equivalents, beginning of period | 299 | 278 |
Cash and cash equivalents, end of period | 344 | 342 |
Supplemental disclosure of cash paid for: | ||
Income taxes, net of refunds | 27 | 34 |
Interest | 43 | 24 |
Forward Contracts | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Gains on foreign exchange contracts - acquisition related | 0 | (23) |
Euro Notes (2031) | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of Euro Notes (2031), net of unamortized bond discount | 816 | 0 |
Euro Notes (2024) | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayment of Euro Notes (2024) | $ (547) | $ 0 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Treasury Stock, Common [Member] | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest |
Balance as of January 1, 2024 at Dec. 31, 2022 | 322.4 | ||||||
Balance as of January 1, 2024 at Dec. 31, 2022 | $ 5,467 | $ 3 | $ (2,389) | $ 1,506 | $ 6,656 | $ (323) | $ 14 |
Balance as of January 1, 2024 at Dec. 31, 2022 | (55.1) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 270 | 270 | |||||
Other comprehensive (loss) income | 43 | 43 | |||||
Purchase of treasury stock | (0.1) | ||||||
Purchase of treasury stock | (5) | $ (5) | |||||
Vesting of restricted stock units, net of shares withheld for employee tax | 0.4 | ||||||
Vesting of restricted stock units, net of shares withheld for employee tax | (6) | (6) | |||||
Stock-based compensation expense | 10 | 10 | |||||
Dividends declared to LKQ stockholders | (74) | (74) | |||||
Balance as of March 31, 2024 at Mar. 31, 2023 | 322.8 | ||||||
Balance as of March 31, 2024 at Mar. 31, 2023 | 5,705 | $ 3 | $ (2,394) | 1,510 | 6,852 | (280) | 14 |
Balance as of March 31, 2024 at Mar. 31, 2023 | (55.2) | ||||||
Balance as of January 1, 2024 at Dec. 31, 2023 | 323.1 | ||||||
Balance as of January 1, 2024 at Dec. 31, 2023 | $ 6,181 | $ 3 | $ (2,424) | 1,538 | 7,290 | (240) | 14 |
Balance as of January 1, 2024 at Dec. 31, 2023 | 55.9 | (55.9) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | $ 158 | 158 | |||||
Other comprehensive (loss) income | (58) | (58) | |||||
Purchase of treasury stock | (0.6) | ||||||
Purchase of treasury stock | (30) | $ (30) | |||||
Vesting of restricted stock units, net of shares withheld for employee tax | 0.4 | ||||||
Vesting of restricted stock units, net of shares withheld for employee tax | (5) | (5) | |||||
Stock-based compensation expense | 8 | 8 | |||||
Dividends declared to LKQ stockholders | (81) | (81) | |||||
Balance as of March 31, 2024 at Mar. 31, 2024 | 323.5 | ||||||
Balance as of March 31, 2024 at Mar. 31, 2024 | $ 6,173 | $ 3 | $ (2,454) | $ 1,541 | $ 7,367 | $ (298) | $ 14 |
Balance as of March 31, 2024 at Mar. 31, 2024 | 56.5 | (56.5) |
Interim Financial Statements
Interim Financial Statements | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Interim Financial Statements | Interim Financial Statements LKQ Corporation, a Delaware corporation, is a holding company and all operations are conducted by subsidiaries. When the terms "LKQ," "the Company," "we," "us," or "our" are used in this document, those terms refer to LKQ Corporation and its consolidated subsidiaries. We have prepared the accompanying Unaudited Condensed Consolidated Financial Statements pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") applicable to interim financial statements. Accordingly, certain information related to our significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted. These Unaudited Condensed Consolidated Financial Statements reflect, in the opinion of management, all material adjustments (which include only normally recurring adjustments) necessary to fairly state, in all material respects, our financial position, results of operations and cash flows for the periods presented. We have reclassified certain prior period amounts to conform to the current period presentation. Results for interim periods are not necessarily indicative of the results that can be expected for any subsequent interim period or for a full year. These interim financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 22, 2024 ("2023 Form 10-K"). Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements During the first quarter of 2023, we adopted Accounting Standards Update No. 2022-04, “Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations” ("ASU 2022-04"), which requires the buyer in a supplier finance program to disclose certain information about its program, including key terms, balance sheet presentation of amounts, outstanding amounts at the end of each period, and rollforwards of balances. We adopted the provisions of ASU 2022-04 on a retrospective basis (see Note 11, "Supply Chain Financing"), except for the disclosure of rollforward information, which will be adopted prospectively in our Annual Report on Form 10-K for the year ending December 31, 2024 as required. The adoption of ASU 2022-04 did not have a material impact on our unaudited condensed consolidated financial statements. Recently Issued Accounting Pronouncements In November 2023, the Financial Accounting Standards Board issued Accounting Standards Update No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”). The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. The ASU is effective on a retrospective basis for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements. In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”). The ASU requires disclosure of disaggregated income taxes paid, prescribes standard categories for the components of the effective tax rate reconciliation, and modifies other income tax-related disclosures. The ASU will be effective for fiscal years beginning after December 15, 2024, and requires prospective application with the option to apply it retrospectively. Early adoption is permitted. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements. |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations During the three months ended March 31, 2024, we completed acquisitions of one business within our Wholesale - North America segment and one business within our Europe segment. These acquisitions were not material to our financial position or results of operations as of and for the three months ended March 31, 2024. Additionally, in January 2024, we paid $23 million (€21 million) to a minority shareholder to settle a put option exercised on redeemable shares issued in conjunction with a previous acquisition. This payment was presented within Other financing activities, net in financing activities in our Unaudited Condensed Consolidated Statements of Cash Flows. On February 26, 2023, we entered into a plan of arrangement to acquire all of Uni-Select's issued and outstanding shares. On August 1, 2023, we completed the acquisition of Uni-Select for an aggregate consideration paid of approximately Canadian dollar (“CAD”) 2.8 billion ($2.1 billion). In order to reduce the risk related to changes in CAD foreign exchange rates for the CAD purchase price, we entered into foreign exchange contracts. These foreign exchange contracts did not qualify for hedge accounting, and therefore the changes in fair value were reported in Gains on foreign exchange contracts - acquisition related in the Unaudited Condensed Consolidated Statements of Income. We reported Gains on foreign exchange contracts - acquisition related of $23 million for the three months ended March 31, 2023. These foreign exchange contracts were settled in July 2023 ahead of closing of the Uni-Select Acquisition, resulting in total payments received of $49 million. See Note 13, "Derivative Instruments and Hedging Activities" for information related to these foreign exchange contracts. In addition to our acquisition of Uni-Select, we completed acquisitions of three businesses within our Wholesale - North America segment, four businesses within our Europe segment and one business in our Specialty segment, during the year ended December 31, 2023. The purchase price allocations for these acquisitions are preliminary and are subject to change during the measurement periods, which is not to exceed 12 months from the close of the acquisitions. During the three months ended March 31, 2024, there have been no significant adjustments to the preliminary purchase price allocations from those disclosed in our December 31, 2023 Consolidated Financial Statements. At this time, we are in the process of finalizing the purchase price allocations, which includes finalizing the following: 1) valuation amounts for certain receivables, inventories and fixed assets acquired; 2) valuation amounts for certain intangible assets acquired; 3) the acquisition date fair value of certain liabilities assumed; and 4) the tax basis of the entities acquired. Unaudited Pro Forma Financial Information The following unaudited pro forma financial information presents the effect of the businesses acquired during the three months ended March 31, 2024 as though the businesses had been acquired as of January 1, 2023, and the businesses acquired during the year ended December 31, 2023 as though they had been acquired as of January 1, 2022. The unaudited pro forma financial information is based upon accounting estimates and judgments that we believe are reasonable. The unaudited pro forma financial information includes the effect of purchase accounting adjustments, such as the adjustment of inventory acquired to fair value, adjustments to depreciation on acquired property, plant and equipment, adjustments to rent expense for above or below market leases, adjustments to amortization on acquired intangible assets, adjustments to interest expense, and the related tax effects. These pro forma results are not necessarily indicative of what would have occurred if the acquisitions had been in effect for the periods presented or of future results. The unaudited pro forma financial information is as follows (in millions): Three Months Ended March 31, 2024 2023 Revenue $ 3,703 $ 3,759 Net income 158 235 The pro forma impact of our acquisitions also reflects the elimination of acquisition related expenses (net of tax) of $10 million and gains on foreign exchange contracts - acquisition related of $23 million for the three months ended March 31, 2023. Refer to Note 8, "Restructuring and Transaction Related Expenses" for further information regarding our acquisition related expenses. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories We classify our inventory into the following categories: (i) aftermarket and refurbished products, (ii) salvage and remanufactured products, and (iii) manufactured products. Inventories consist of the following (in millions): March 31, 2024 December 31, 2023 Aftermarket and refurbished products $ 2,570 $ 2,556 Salvage and remanufactured products 499 510 Manufactured products 54 55 Total inventories $ 3,123 $ 3,121 Aftermarket and refurbished products and salvage and remanufactured products are primarily composed of finished goods. As of March 31, 2024, manufactured products inventory was composed of $24 million of raw materials, $7 million of work in process, and $23 million of finished goods. As of December 31, 2023, manufactured products inventory was composed of $26 million of raw materials, $7 million of work in process, and $22 million of finished goods. |
Allowance for Credit Losses
Allowance for Credit Losses | 3 Months Ended |
Mar. 31, 2024 | |
Credit Loss [Abstract] | |
Allowance for Credit Losses | Allowance for Credit Losses Our allowance for credit losses was $58 million and $61 million as of March 31, 2024 and December 31, 2023, respectively. The provision for credit losses was |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Goodwill and indefinite-lived intangible assets are tested for impairment at least annually. We performed our annual impairment test during the fourth quarter of 2023, and determined no impairment existed as all of our reporting units had a fair value estimate which exceeded the carrying value by at least 20%. The fair value estimates of our reporting units were established using weightings of the results of a discounted cash flow methodology and a comparative market multiples approach. Goodwill and indefinite-lived intangible assets impairment testing may also be performed on an interim basis when events or circumstances arise that may lead to impairment. We did not identify any indicators of impairment in the first three months of 2024 that necessitated an interim test of goodwill impairment or indefinite-lived intangible assets impairment. |
Equity Method Investments
Equity Method Investments | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method Investments The carrying value of our Equity method investments were as follows (in millions): Segment Ownership as of March 31, 2024 March 31, 2024 December 31, 2023 MEKO AB (1) Europe 26.6% $ 152 $ 145 Other 11 14 Total $ 163 $ 159 (1) As of March 31, 2024, the Level 1 fair value of our investment in MEKO AB ("Mekonomen") was $178 million based on the quoted market price for Mekonomen's common stock using the same foreign exchange rate as the carrying value. Our share of the book value of Mekonomen's net assets exceeded the book value of our investment by $10 million; this difference is primarily related to Mekonomen's Accumulated Other Comprehensive Income balance as of our acquisition date in 2016. We record our equity in the net earnings of Mekonomen on a one quarter lag. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2024 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregated Revenue We report revenue in two categories: (i) parts and services and (ii) other. Parts revenue is generated from the sale of vehicle products including replacement parts, components and systems used in the repair and maintenance of vehicles and specialty products and accessories to improve the performance, functionality and appearance of vehicles. Services revenue includes (i) additional services that are generally billed concurrently with the related product sales, such as the sale of service-type warranties, (ii) fees for admission to our self service yards, and (iii) diagnostic and repair services. For Wholesale - North America and Self Service, vehicle replacement products include sheet metal collision parts such as doors, hoods, and fenders; bumper covers; head and tail lamps; mirrors; grilles; wheels; and large mechanical items such as engines and transmissions. For Europe, and to a lesser extent for Wholesale - North America, vehicle replacement products include a wide variety of small mechanical products such as brake pads, discs and sensors; clutches; electrical products such as spark plugs and batteries; steering and suspension products; filters; and oil and automotive fluids. Additionally, in both our Wholesale - North America and Europe segments, we sell paint and paint related consumables for refinishing vehicles. For our Specialty operations, we serve seven product segments: truck and off-road; speed and performance; recreational vehicles; towing; wheels, tires and performance handling; marine; and miscellaneous accessories. Other revenue includes sales of scrap and precious metals (platinum, palladium, and rhodium), bulk sales to mechanical manufacturers (including cores) and sales of aluminum ingots and sows from furnace operations. We derive scrap metal and other precious metals from several sources in both our Wholesale - North America and Self Service segments, including vehicles that have been used in our recycling operations and vehicles from original equipment manufacturers ("OEMs") and other entities that contract with us for secure disposal of "crush only" vehicles. Revenue from the sale of hulks in our Wholesale - North America and Self Service segments is recognized based on a price per ton of delivered material when the customer (processor) collects the scrap. The following table sets forth our revenue disaggregated by category and reportable segment (in millions): Three Months Ended March 31, 2024 2023 Wholesale - North America $ 1,422 $ 1,148 Europe 1,637 1,548 Specialty 422 396 Self Service 54 60 Parts and services 3,535 3,152 Wholesale - North America 78 81 Europe 7 7 Self Service 83 109 Other 168 197 Total revenue $ 3,703 $ 3,349 Variable Consideration Amounts related to variable consideration on our Unaudited Condensed Consolidated Balance Sheets are as follows (in millions): Classification March 31, 2024 December 31, 2023 Return asset Prepaid expenses and other current assets $ 72 $ 68 Refund liability Refund liability 137 132 Variable consideration reserve Receivables, net of allowance for credit losses 102 155 Revenue by Geographic Area Our net sales are attributed to geographic area based on the location of the selling operation. The following table sets forth our revenue by geographic area (in millions): Three Months Ended March 31, 2024 2023 Revenue United States $ 1,795 $ 1,681 Germany 425 416 United Kingdom 445 415 Other countries 1,038 837 Total revenue $ 3,703 $ 3,349 |
Restructuring and Transaction R
Restructuring and Transaction Related Expenses | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Acquisition Related Expenses [Abstract] | |
Restructuring and Transaction Related Expenses | Restructuring and Transaction Related Expenses From time to time, we initiate restructuring plans to integrate acquired businesses, to align our workforce with strategic business activities, or to improve efficiencies in our operations. Below is a summary of our current restructuring plans: 2024 Global Restructuring Plan In the first quarter of 2024, we began a global restructuring initiative focused on enhancing profitability. The largest portion of the activity will come from the Europe segment and will include exiting certain businesses or markets which do not align with our strategic objectives. Initially, this includes exiting markets located in Bosnia and Slovenia. In April 2024, we entered into agreements to divest our operations in Slovenia, which closed in April 2024, and Bosnia, which we expect to close in the third quarter of 2024 subject to regulatory approval. Our decision to exit these and other markets constituted a triggering event to evaluate certain long-lived assets for impairment, and as a result, we incurred and expect to incur impairment charges as we move forward with the plans to exit Bosnia, Slovenia and any other identified markets. In addition to these impairment charges, we will incur charges to write-down or dispose of long-lived assets, inventory and other assets; for employee severance; and to terminate leases. This plan is scheduled to be substantially complete by the end of 2025 with an estimated total incurred cost of between $55 million and $75 million. In the future, we may identify additional initiatives under the plan that may result in additional expenditures, although we are currently unable to estimate the range of charges for such potential future initiatives. 2022 Global Restructuring Plan In the fourth quarter of 2022, we began a restructuring initiative covering all of our reportable segments designed to reduce costs, streamline operations, consolidate facilities and implement other strategic changes to the overall organization. We have incurred and expect to incur costs primarily for employee severance, inventory or other asset write-downs, and exiting facilities. This plan is scheduled to be substantially complete by the end of 2024 with an estimated total incurred cost of between $28 million and $35 million. 1 LKQ Europe Plan In 2019, we announced a multi-year plan called "1 LKQ Europe" which is intended to create structural centralization and standardization of key functions to facilitate the operation of the Europe segment as a single business. Under the 1 LKQ Europe plan, we are reorganizing our non-customer-facing teams and support systems through various projects including the implementation of a common Enterprise Resource Planning platform, rationalization of our product portfolio, and creation of a Europe headquarters office and central back office. We completed the organizational design and implementation projects in June 2021, with the remaining projects scheduled to be completed by the end of 2027 with a total incurred cost of between $30 million and $40 million. Acquisition Integration Plans As we complete the acquisition of a business, we may incur costs related to integrating the acquired business into our current business structure and systems. These costs are typically incurred within a year from the acquisition date and vary in magnitude depending on the size and complexity of the related integration activities. We expect to incur additional expenses of between $5 million and $15 million by the end of 2024 to substantially complete the integration plan related to the Uni-Select Acquisition in our Wholesale - North America segment. The following table sets forth the expenses incurred related to our restructuring plans (in millions): Three Months Ended March 31, Plan Expense Type 2024 2023 2024 Global Plan Inventory related costs (1) $ 8 $ — Asset impairments (2) 17 — Other costs 2 — Total $ 27 $ — 2022 Global Plan Employee related costs $ — $ 2 Facility exit costs 1 2 Other costs — 1 Total $ 1 $ 5 1 LKQ Europe Plan Employee related costs $ 1 $ 1 Facility exit costs 1 — Total $ 2 $ 1 Acquisition Integration Plans Employee related costs $ 1 $ — Facility exit costs 4 2 Other costs 1 — Total $ 6 $ 2 Total restructuring expenses $ 36 $ 8 (1) Recorded to Cost of goods sold in the Unaudited Condensed Consolidated Statements of Income (2) Related to impairment of assets in Property, plant and equipment, net and Prepaid expenses and other current assets on the Unaudited Condensed Consolidated Balance Sheets. The following table sets forth the cumulative plan costs by segment related to our restructuring plans (in millions): Cumulative Program Costs Wholesale - North America Europe Specialty Self Service Total 2024 Global Plan $ — $ 27 $ — $ — $ 27 2022 Global Plan 2 17 4 3 26 1 LKQ Europe Plan — 12 — — 12 Transaction Related Expenses |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following chart sets forth the computation of earnings per share (in millions, except per share amounts): Three Months Ended March 31, 2024 2023 Net income $ 158 $ 270 Denominator for basic earnings per share—Weighted-average shares outstanding 267.1 267.4 Effect of dilutive securities: Restricted stock units ("RSUs") 0.5 0.7 Performance-based RSUs ("PSUs") 0.1 0.2 Denominator for diluted earnings per share—Adjusted weighted-average shares outstanding 267.7 268.3 Basic earnings per share $ 0.59 $ 1.01 Diluted earnings per share (1) $ 0.59 $ 1.01 (1) Diluted earnings per share was computed using the treasury stock method for dilutive securities. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2024 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The components of Accumulated Other Comprehensive Income (Loss) are as follows (in millions): Three Months Ended March 31, 2024 Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges Unrealized Gain on Pension Plans Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries Accumulated Other Comprehensive Income (Loss) Balance as of January 1, 2024 $ (243) $ (11) $ 6 $ 8 $ (240) Pretax (loss) income (57) 6 — — (51) Income tax effect — (1) — — (1) Reclassification of unrealized gain — (1) — — (1) Other comprehensive loss from unconsolidated subsidiaries — — — (5) (5) Balance as of March 31, 2024 $ (300) $ (7) $ 6 $ 3 $ (298) Three Months Ended March 31, 2023 Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges Unrealized Gain on Pension Plans Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries Accumulated Other Comprehensive Income (Loss) Balance as of January 1, 2023 $ (333) $ — $ 11 $ (1) $ (323) Pretax income (loss) 57 (22) — — 35 Income tax effect — 5 — — 5 Other comprehensive income from unconsolidated subsidiaries — — — 3 3 Balance as of March 31, 2023 $ (276) $ (17) $ 11 $ 2 $ (280) Our policy is to reclassify the income tax effect from Accumulated other comprehensive income (loss) to the Provision for income taxes when the related gains and losses are released to the Unaudited Condensed Consolidated Statements of Income. |
Supply Chain Financing
Supply Chain Financing | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Supplier Chain Financing | Supply Chain Financing We utilize voluntary supply chain finance programs to support our efforts in negotiating payment term extensions with suppliers as part of our effort to improve our operating cash flows. These programs provide participating suppliers the opportunity to sell their LKQ receivables to financial institutions at the sole discretion of both the suppliers and the financial institutions. We are not a party to the agreement between the suppliers and financial institutions. The financial institutions participate in the supply chain financing initiative on an uncommitted basis and can cease purchasing receivables from our suppliers at any time. Our obligation to our suppliers, including amount due and payment date, are not impacted by the supplier’s decision to sell amounts under these agreements. Our payment terms to the financial institutions, including the timing and amount of payments, are unchanged from the original supplier invoice. All outstanding payments owed under the supply chain finance programs with the participating financial institutions are recorded within Accounts payable on our Unaudited Condensed Consolidated Balance Sheets. As of March 31, 2024 and December 31, 2023, we had $422 million and $411 million of Accounts payable outstanding under the arrangements, respectively. |
Long-Term Obligations
Long-Term Obligations | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Long-Term Obligations | Long-Term Obligations Long-term obligations consist of the following (in millions): March 31, 2024 December 31, 2023 Maturity Date Interest Rate Amount Interest Rate Amount Senior Unsecured Credit Agreement: Term loan payable January 2026 6.81 % $ 500 6.83 % $ 500 Revolving credit facilities January 2028 6.58 % (1) 640 6.25 % (1) 914 Senior Unsecured Term Loan Agreement: Term loan payable July 2026 6.67 % 517 6.82 % 529 Unsecured Senior Notes: U.S. Notes (2028) June 2028 5.75 % 800 5.75 % 800 U.S. Notes (2033) June 2033 6.25 % 600 6.25 % 600 Euro Notes (2024) April 2024 — % — 3.88 % 552 Euro Notes (2028) April 2028 4.13 % 270 4.13 % 276 Euro Notes (2031) March 2031 4.13 % 809 — % — Notes payable Various through October 2030 3.49 % (1) 18 3.85 % (1) 16 Finance lease obligations 4.95 % (1) 85 4.83 % (1) 83 Other debt 5.73 % (1) 48 2.16 % (1) 11 Total debt 4,287 4,281 Less: long-term debt issuance costs and unamortized bond discount (38) (30) Total debt, net of debt issuance costs and unamortized bond discount 4,249 4,251 Less: current maturities, net of debt issuance costs (88) (596) Long term debt, net of debt issuance costs and unamortized bond discount $ 4,161 $ 3,655 (1) Interest rate derived via a weighted average Senior Unsecured Credit Agreement Our Senior Unsecured Credit Agreement consists of (i) an unsecured revolving credit facility of up to a U.S. Dollar equivalent of $2.0 billion, which includes a $150 million sublimit for the issuance of letters of credit and a $150 million sublimit for swing line loans and (ii) an unsecured term loan facility of up to $500 million. Borrowings under the agreement bear interest at the Secured Overnight Financing Rate (i.e. "SOFR") plus the applicable spread or other risk-free interest rates that are applicable for the specified currency plus a spread based on the Company's debt rating and total leverage ratio. Senior Unsecured Term Loan Credit Agreement The Senior Unsecured Term Loan Credit Agreement ("CAD Note") established an unsecured term loan facility of up to CAD 700 million maturing in July 2026. The variable interest rate applicable to the CAD Note may be (i) a forward-looking term rate based on the Canadian Dollar Offer Rate for an interest period chosen by the Company of one or three months or (ii) the Canadian Prime Rate (as defined in the CAD Note), plus in each case a spread based on the Company’s debt rating and total leverage ratio. Unsecured Senior Notes On March 13, 2024, LKQ Corporation, together with its indirect, wholly-owned subsidiary, LKQ Dutch Bond B.V., a private company with limited liability, completed an offering and sale of €750 million aggregate principal amount of its 4.125% Notes due March 13, 2031 (“Euro Notes (2031)”). The Euro Notes (2031) bear interest at a rate of 4.125% per year. Interest on the Euro Notes (2031) is payable annually on each March 13, commencing on March 13, 2025. The Euro Notes (2031) will be initially fully and unconditionally guaranteed on a senior unsecured basis (the “Guarantees”) by the Company and each of its wholly owned U.S. subsidiaries that are guarantors under our Senior Unsecured Credit Agreement and our CAD Note. The Euro Notes (2031) will also be guaranteed by each of the Company’s U.S. subsidiaries that in the future agrees to guarantee the Company’s obligations under the Senior Unsecured Credit Agreement, the CAD Note, any other Credit Facility Debt or any Capital Markets Debt (both as defined in the Company’s preliminary prospectus supplement filed with the SEC on February 28, 2024). Prior to December 13, 2030 (the "Par Call Date"), the Euro Notes (2031) are redeemable, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of: (1)(a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming that the Euro Notes (2031) matured on the Par Call Date) on an annual (ACTUAL/ACTUAL (ICMA)) basis at a rate equal to the Comparable Government Bond Rate (as defined in the Indenture, dated March 13, 2024 (the "Euro Notes (2031) Indenture")) plus 30 basis points, less (b) interest accrued to the date of redemption; and (2) 100% of the principal amount of the Euro Notes (2031) to be redeemed; plus, in either case, accrued and unpaid interest thereon to, but excluding, the redemption date. On or after the Par Call Date, we may redeem the Euro Notes (2031), in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the Euro Notes (2031) being redeemed plus accrued and unpaid interest thereon to, but excluding, the redemption date. The Euro Notes (2031) and the Guarantees have been registered under the United States Securities Act of 1933 under the Registration Statement on Form S-3 (File No. 333-277267) filed by the Company with the SEC on February 22, 2024, as supplemented by the prospectus supplement filed by the Company with the SEC on March 1, 2024. Subsequently, the Euro Notes (2031) were approved for listing and registration on the Nasdaq. Related to the offering and sale of the Euro Notes (2031) in March 2024, we incurred $7 million of fees, which were capitalized as an offset to Long-Term Obligations and are amortized over the term of the Euro Notes (2031). We used the net proceeds from this offering to (i) pay outstanding indebtedness, including all of the outstanding €500 million aggregate principal amount of the 3.875% senior notes due 2024 (the “Euro Notes (2024)”) issued by the Company’s indirect wholly-owned subsidiary, LKQ Italia Bondco di LKQ Italia Bondco GP S.r.l e C.S.A.P.A. (f/k/a LKQ Italia Bondco S.p.A.) (the “Redemption”), and (ii) pay accrued interest and related fees, premiums and expenses. The Euro Notes (2031) are governed by the Euro Notes (2031) Indenture, dated as of March 13, 2024. Interest on the U.S. Notes (2028/33) is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on December 15, 2023. Interest on our 4.13% senior notes due April 2028 (the "Euro Notes (2028)") is payable in arrears on April 1 and October 1 of each year. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities We are exposed to market risks, including the effect of changes in interest rates, foreign currency exchange rates and commodity prices. Under current policies, we may use derivatives to manage our exposure to variable interest rates on our debt and changing foreign exchange rates for certain foreign currency denominated transactions. We do not hold or issue derivatives for trading purposes. Derivative Instruments Designated as Cash Flow Hedges In February 2023, we entered into interest rate swap agreements to mitigate the risk of changing interest rates on our variable interest rate payments related to borrowings under our Senior Unsecured Credit Agreement. Under the terms of the interest rate swap agreements, we pay the fixed interest rate and receive a variable interest rate based on term SOFR that matches a contractually specified rate under the Senior Unsecured Credit Agreement. The agreements include a total $400 million notional amount maturing in February 2025 with a weighted average fixed interest rate of 4.63% and a total $300 million notional amount maturing in February 2026 with a weighted average fixed interest rate of 4.23%. Changes in the fair value of the interest rate swaps are recorded in Accumulated other comprehensive loss and reclassified to Interest expense when the hedged interest payments affect earnings. The activity related to the interest rate swaps is classified in operating activities in our Unaudited Condensed Consolidated Statements of Cash Flows as the activity relates to normal recurring settlements to match interest payments. In March 2023, we entered into forward starting interest rate swaps to hedge the risk of changes in interest rates related to forecasted debt issuance to finance a portion of the Uni-Select Acquisition. These swaps were settled in May 2023 upon issuance of the U.S. Notes (2028/33), resulting in total payments of $13 million. Changes in the fair value of the interest rate swaps were recorded in Accumulated other comprehensive loss and the fair value at the termination date is being reclassified to Interest expense over the term of the debt. All of our interest rate swap contracts have been executed with counterparties that we believe are creditworthy, and we closely monitor the credit ratings of these counterparties. As of March 31, 2024 and December 31, 2023, the notional amounts, balance sheet classification and fair values of our derivative instruments designated as cash flow hedges were as follows (in millions): March 31, 2024 Notional Amount Balance Sheet Caption Fair Value - Asset / (Liability) Interest rate swap agreements $ 400 Prepaid expenses and other current assets $ 1 Interest rate swap agreements 300 Other noncurrent assets 2 December 31, 2023 Notional Amount Balance Sheet Caption Fair Value - Asset / (Liability) Interest rate swap agreements $ 700 Other noncurrent liabilities $ (2) The activity related to our cash flow hedges is included in Note 10, "Accumulated Other Comprehensive Income (Loss)." As of March 31, 2024, we estimate that $1 million of derivative gains (net of tax) included in Accumulated other comprehensive loss will be reclassified into our Unaudited Condensed Consolidated Statements of Income within the next 12 months. Derivative Instruments Not Designated as Hedges To manage the foreign currency exposure related to the Uni-Select Acquisition purchase price (denominated in CAD), we entered into foreign exchange contracts in March 2023 to purchase CAD 1.6 billion for approximately $1.2 billion. These contracts did not qualify for hedge accounting, and therefore, the contracts were adjusted to fair value through the results of operations as of each balance sheet date. We reported Gains on foreign exchange contracts - acquisition related of $23 million for the three months ended March 31, 2023. These contracts were settled in July 2023 resulting in total payments received of $49 million. To manage our foreign currency exposure on other non-functional currency denominated intercompany loans, we entered into short-term foreign currency forward contracts in 2023. We have not elected to apply hedge accounting for these transactions, and therefore the contracts are adjusted to fair value through our results of operations as of each balance sheet date. The fair values of these short-term derivative instruments that remained outstanding as of March 31, 2024 were recorded in either Prepaid expenses and other current assets or Other accrued expenses on our Unaudited Condensed Consolidated Balance Sheets and were not material at March 31, 2024 and December 31, 2023. Additionally, we hold other short-term derivative instruments, including foreign currency forward contracts, to manage our exposure to variability in the cash flows related to inventory purchases denominated in a non-functional currency. We have not elected to apply hedge accounting for these transactions. The notional amount and fair value of these contracts at March 31, 2024 and December 31, 2023, along with the effect on our results of operations during the three months ended March 31, 2024 and 2023, were not material. The fair values of these contracts were recorded in either Prepaid expenses and other current assets or Other accrued expenses on our Unaudited Condensed Consolidated Balance Sheets. Gross vs. Net Presentation for Derivative Instruments While certain derivative instruments executed with the same counterparty are subject to master netting arrangements, we present our cash flow hedge and other derivative instruments on a gross basis on our Unaudited Condensed Consolidated Balance Sheets. The impact of netting the fair values of these contracts would result in an immaterial decrease to Prepaid expenses and other current assets and Other accrued expenses on our Unaudited Condensed Consolidated Balance Sheets at March 31, 2024 and December 31, 2023. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Financial Assets and Liabilities Measured at Fair Value We use the market and income approaches to estimate the fair value of our financial assets and liabilities, and during the three months ended March 31, 2024, there were no significant changes in valuation techniques or inputs related to the financial assets or liabilities that we have historically recorded at fair value. The tiers in the fair value hierarchy include: Level 1, defined as observable inputs such as quoted market prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as significant unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. The following table presents information about our financial assets and liabilities measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs we utilized to determine such fair value as of March 31, 2024 and December 31, 2023 (in millions): March 31, 2024 December 31, 2023 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Interest rate swaps $ — $ 3 $ — $ 3 $ — $ — $ — $ — Investments - debt securities 21 — — 21 22 — — 22 Investments - equity securities 5 — — 5 3 — — 3 Total Assets $ 26 $ 3 $ — $ 29 $ 25 $ — $ — $ 25 Liabilities: Interest rate swaps $ — $ — $ — $ — $ — $ 2 $ — $ 2 Contingent consideration liabilities — — 4 4 — — 2 2 Total Liabilities $ — $ — $ 4 $ 4 $ — $ 2 $ 2 $ 4 Investments in debt and equity securities relate to our captive insurance subsidiary and are included in Other noncurrent assets on the Unaudited Condensed Consolidated Balance Sheets. The balance sheet classification of the interest rate swap agreements is presented in Note 13, "Derivative Instruments and Hedging Activities." For contingent consideration liabilities, the current portion is included in Other current liabilities and the noncurrent portion is included in Other noncurrent liabilities on the Unaudited Condensed Consolidated Balance Sheets based on the expected timing of the related payments. We value derivative instruments using a third party valuation model that performs discounted cash flow analysis based on the terms of the contracts and market observable inputs such as current and forward interest rates and current and forward foreign exchange rates. Our contingent consideration liabilities are related to our business acquisitions. Under the terms of the contingent consideration agreements, payments may be made at specified future dates depending on the performance of the acquired business subsequent to the acquisition. The liabilities for these payments are classified as Level 3 liabilities because the related fair value measurement, which is determined using an income approach, includes significant inputs not observable in the market. Financial Assets and Liabilities Not Measured at Fair Value Our debt is reflected on the Unaudited Condensed Consolidated Balance Sheets at cost. The fair value measurements of the borrowings under the credit agreement are classified as Level 2 within the fair value hierarchy since they are determined based upon significant inputs observable in the market, including interest rates on recent financing transactions with similar terms and maturities. We estimated the fair value by calculating the upfront cash payment a market participant would require at March 31, 2024 and December 31, 2023 to assume these obligations. The fair values of the U.S. Notes (2028), U.S. Notes (2033), Euro Notes (2024), Euro Notes (2028) and Euro Notes (2031) are determined based upon observable market inputs including quoted market prices in markets that are not active, and therefore are classified as Level 2 within the fair value hierarchy. Based on market conditions as of March 31, 2024 and December 31, 2023, the fair value of the borrowings under the Senior Unsecured Credit Agreement reasonably approximated the carrying values of $1,140 million and $1,414 million, respectively. As of March 31, 2024 and December 31, 2023, the fair value of the borrowings under the CAD Note reasonably approximated the carrying values of $517 million and $529 million, respectively. The following table provides the carrying and fair value for our other financial instruments as of March 31, 2024 and December 31, 2023 (in millions): As of March 31, 2024 As of December 31, 2023 Carrying Value Fair Value Carrying Value Fair Value U.S. Notes (2028) $ 800 $ 815 $ 800 $ 820 U.S. Notes (2033) 600 624 600 628 Euro Notes (2024) — — 552 552 Euro Notes (2028) 270 271 276 276 Euro Notes (2031) 809 820 — — |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2024 | |
Employee Benefit Plans [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans We have funded and unfunded defined benefit plans covering certain employee groups in various European countries and Canada. Local statutory requirements govern many of our European and Canadian plans. The defined benefit plans are mostly closed to new participants and, in some cases, existing participants no longer accrue benefits. As of March 31, 2024 and December 31, 2023, the aggregate funded status of the defined benefit plans was a net liability of $80 million and $83 million, respectively, and is reported in Other noncurrent assets, Other noncurrent liabilities and Accrued payroll-related liabilities on our Unaudited Condensed Consolidated Balance Sheets. Net periodic benefit cost for our defined benefit plans were insignificant for each of the three-month periods ended March 31, 2024 and 2023. The service cost component is recorded in Selling, general and administrative ("SG&A") expenses, while the other components are recorded to Interest income and other income, net on the Unaudited Condensed Consolidated Statements of Income. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes At the end of each interim period, we estimate our annual effective tax rate and apply that rate to our interim earnings. We also record the tax impact of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and the effects of changes in tax laws or rates, in the interim period in which they occur. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and significant judgment including, but not limited to, the expected operating income for the year, projections of the proportion of income earned and taxed in state and foreign jurisdictions, permanent and temporary differences between book and taxable income, and the likelihood of recovering deferred tax assets generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as the tax environment changes. Our effective income tax rate for the three months ended March 31, 2024 was 30.7%, compared to 26.1% for the three months ended March 31, 2023. The increase in the effective tax rate for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was primarily attributable to the 4.4% unfavorable impact of discrete items, mostly related to the 2024 Global Restructuring Plan impairments. Refer to Note 8, "Restructuring and Transaction Related Expenses" for further information on the impairments. The OECD released a framework, referred to as Pillar Two, to implement a global minimum corporate tax rate of 15% on certain multinational enterprises. Certain countries have enacted legislation to adopt the Pillar Two framework while several countries are considering or still announcing changes to their tax laws to implement the minimum tax directive. While we do not currently estimate Pillar Two to have a material impact on our effective tax rate, our analysis will continue as the OECD continues to release additional guidance and countries implement legislation. |
Segment and Geographic Informat
Segment and Geographic Information | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information We have four operating segments: Wholesale - North America; Europe; Specialty; and Self Service, each of which is presented as a reportable segment. The segments are organized based on a combination of geographic areas served and type of product lines offered. The segments are managed separately as the businesses serve different customers and are affected by different economic conditions. Wholesale - North America and Self Service have similar economic characteristics and have common products and services, customers and methods of distribution. We are reporting these operating segments separately to provide greater transparency to investors. The following tables present our financial performance by reportable segment for the periods indicated (in millions): Wholesale - North America Europe Specialty Self Service Eliminations Consolidated Three Months Ended March 31, 2024 Revenue: Third Party $ 1,500 $ 1,644 $ 422 $ 137 $ — $ 3,703 Intersegment — — 1 — (1) — Total segment revenue $ 1,500 $ 1,644 $ 423 $ 137 $ (1) $ 3,703 Segment EBITDA $ 244 $ 143 $ 27 $ 16 $ — $ 430 Total depreciation and amortization (1) 49 39 8 4 — 100 Three Months Ended March 31, 2023 Revenue: Third Party $ 1,229 $ 1,555 $ 396 $ 169 $ — $ 3,349 Intersegment — — 1 — (1) — Total segment revenue $ 1,229 $ 1,555 $ 397 $ 169 $ (1) $ 3,349 Segment EBITDA $ 252 $ 151 $ 31 $ 22 $ — $ 456 Total depreciation and amortization (1) 19 34 8 4 — 65 (1) Amounts presented include depreciation and amortization expense recorded within Cost of goods sold, SG&A expenses and Restructuring and transaction related expenses. The key measure of segment profit or loss reviewed by our chief operating decision maker, our Chief Executive Officer, is Segment EBITDA. We use Segment EBITDA to compare profitability among the segments and evaluate business strategies. Segment EBITDA includes revenue and expenses that are controllable by the segment. Corporate general and administrative expenses are allocated to the segments based on usage, with shared expenses apportioned based on the segment's percentage of consolidated revenue. We calculate Segment EBITDA as Net Income excluding net income and loss attributable to noncontrolling interest; income and loss from discontinued operations; depreciation; amortization; interest; gains and losses on debt extinguishment; income tax expense; restructuring and transaction related expenses (which includes restructuring expenses recorded in Cost of goods sold); change in fair value of contingent consideration liabilities; other gains and losses related to acquisitions, equity method investments, or divestitures; equity in losses and earnings of unconsolidated subsidiaries; equity investment fair value adjustments; impairment charges; and direct impacts of the Ukraine/Russia conflict and related sanctions. The table below provides a reconciliation of Net Income to Segment EBITDA (in millions): Three Months Ended March 31, 2024 2023 Net income $ 158 $ 270 Adjustments: Depreciation and amortization 100 65 Interest expense, net of interest income 61 33 Loss on debt extinguishment — 1 Provision for income taxes 71 94 Equity in losses (earnings) of unconsolidated subsidiaries (1) 2 (3) Gains on foreign exchange contracts - acquisition related (2) — (23) Equity investment fair value adjustments — 1 Restructuring and transaction related expenses (3) 30 18 Restructuring expenses - cost of goods sold (3) 8 — Segment EBITDA $ 430 $ 456 (1) Refer to Note 6, "Equity Method Investments" for further information. (2) Refer to Note 2, "Business Combinations" and Note 13, "Derivative Instruments and Hedging Activities" for further information. (3) Refer to Note 8, "Restructuring and Transaction Related Expenses" for further information. The following table presents capital expenditures by reportable segment (in millions): Three Months Ended March 31, 2024 2023 Capital Expenditures Wholesale - North America $ 21 $ 20 Europe 38 33 Specialty 4 13 Self Service 3 4 Total capital expenditures $ 66 $ 70 The following table presents assets by reportable segment (in millions): March 31, 2024 December 31, 2023 Receivables, net of allowance for credit losses Wholesale - North America $ 497 $ 470 Europe 733 580 Specialty 153 107 Self Service 9 8 Total receivables, net of allowance for credit losses 1,392 1,165 Inventories Wholesale - North America 1,234 1,217 Europe 1,372 1,390 Specialty 477 475 Self Service 40 39 Total inventories 3,123 3,121 Property, plant and equipment, net Wholesale - North America 641 644 Europe 626 642 Specialty 116 118 Self Service 110 112 Total property, plant and equipment, net 1,493 1,516 Operating lease assets, net Wholesale - North America 617 615 Europe 481 494 Specialty 81 84 Self Service 135 143 Total operating lease assets, net 1,314 1,336 Other unallocated assets 7,948 7,941 Total assets $ 15,270 $ 15,079 We report net receivables; inventories; net property, plant and equipment; and net operating lease assets by segment as that information is used by the chief operating decision maker in assessing segment performance. These assets provide a measure for the operating capital employed in each segment. Unallocated assets include cash and cash equivalents, prepaid expenses and other current and noncurrent assets, goodwill, other intangibles and equity method investments. Our largest countries of operation are the U.S., followed by Germany and the United Kingdom ("U.K."). Additional European operations are located in the Netherlands, Italy, Czech Republic, Belgium, Austria, Slovakia, Poland, and other European countries. As a result of the Uni-Select Acquisition, we further expanded our wholesale operations in Canada. Our operations in other countries include remanufacturing operations in Mexico, an aftermarket parts freight consolidation warehouse in Taiwan, and administrative support functions in India. The following table sets forth our tangible long-lived assets by geographic area (in millions): March 31, 2024 December 31, 2023 Long-lived assets United States $ 1,488 $ 1,496 Germany 324 324 United Kingdom 299 295 Other countries 696 737 Total long-lived assets $ 2,807 $ 2,852 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ 158 | $ 270 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Business Combinations (Tables)
Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Acquisition, Pro Forma Information | The unaudited pro forma financial information is as follows (in millions): Three Months Ended March 31, 2024 2023 Revenue $ 3,703 $ 3,759 Net income 158 235 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | Inventories consist of the following (in millions): March 31, 2024 December 31, 2023 Aftermarket and refurbished products $ 2,570 $ 2,556 Salvage and remanufactured products 499 510 Manufactured products 54 55 Total inventories $ 3,123 $ 3,121 |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | The carrying value of our Equity method investments were as follows (in millions): Segment Ownership as of March 31, 2024 March 31, 2024 December 31, 2023 MEKO AB (1) Europe 26.6% $ 152 $ 145 Other 11 14 Total $ 163 $ 159 (1) As of March 31, 2024, the Level 1 fair value of our investment in MEKO AB ("Mekonomen") was $178 million based on the quoted market price for Mekonomen's common stock using the same foreign exchange rate as the carrying value. Our share of the book value of Mekonomen's net assets exceeded the book value of our investment by $10 million; this difference is primarily related to Mekonomen's Accumulated Other Comprehensive Income balance as of our acquisition date in 2016. We record our equity in the net earnings of Mekonomen on a one quarter lag. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue Recognition [Line Items] | |
Disaggregation of Revenue [Table Text Block] | The following table sets forth our revenue disaggregated by category and reportable segment (in millions): Three Months Ended March 31, 2024 2023 Wholesale - North America $ 1,422 $ 1,148 Europe 1,637 1,548 Specialty 422 396 Self Service 54 60 Parts and services 3,535 3,152 Wholesale - North America 78 81 Europe 7 7 Self Service 83 109 Other 168 197 Total revenue $ 3,703 $ 3,349 |
Variable Consideration | Amounts related to variable consideration on our Unaudited Condensed Consolidated Balance Sheets are as follows (in millions): Classification March 31, 2024 December 31, 2023 Return asset Prepaid expenses and other current assets $ 72 $ 68 Refund liability Refund liability 137 132 Variable consideration reserve Receivables, net of allowance for credit losses 102 155 |
Revenue from External Customers by Geographic Area | The following table sets forth our revenue by geographic area (in millions): Three Months Ended March 31, 2024 2023 Revenue United States $ 1,795 $ 1,681 Germany 425 416 United Kingdom 445 415 Other countries 1,038 837 Total revenue $ 3,703 $ 3,349 |
Restructuring and Transaction_2
Restructuring and Transaction Related Expenses (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Expenses | The following table sets forth the expenses incurred related to our restructuring plans (in millions): Three Months Ended March 31, Plan Expense Type 2024 2023 2024 Global Plan Inventory related costs (1) $ 8 $ — Asset impairments (2) 17 — Other costs 2 — Total $ 27 $ — 2022 Global Plan Employee related costs $ — $ 2 Facility exit costs 1 2 Other costs — 1 Total $ 1 $ 5 1 LKQ Europe Plan Employee related costs $ 1 $ 1 Facility exit costs 1 — Total $ 2 $ 1 Acquisition Integration Plans Employee related costs $ 1 $ — Facility exit costs 4 2 Other costs 1 — Total $ 6 $ 2 Total restructuring expenses $ 36 $ 8 (1) Recorded to Cost of goods sold in the Unaudited Condensed Consolidated Statements of Income (2) Related to impairment of assets in Property, plant and equipment, net and Prepaid expenses and other current assets on the Unaudited Condensed Consolidated Balance Sheets. |
Restructuring Cumulative Plan Costs | The following table sets forth the cumulative plan costs by segment related to our restructuring plans (in millions): Cumulative Program Costs Wholesale - North America Europe Specialty Self Service Total 2024 Global Plan $ — $ 27 $ — $ — $ 27 2022 Global Plan 2 17 4 3 26 1 LKQ Europe Plan — 12 — — 12 |
Earnings Per Share Schedule of
Earnings Per Share Schedule of Earnings Per Share, Basic and Diluted (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table] | The following chart sets forth the computation of earnings per share (in millions, except per share amounts): Three Months Ended March 31, 2024 2023 Net income $ 158 $ 270 Denominator for basic earnings per share—Weighted-average shares outstanding 267.1 267.4 Effect of dilutive securities: Restricted stock units ("RSUs") 0.5 0.7 Performance-based RSUs ("PSUs") 0.1 0.2 Denominator for diluted earnings per share—Adjusted weighted-average shares outstanding 267.7 268.3 Basic earnings per share $ 0.59 $ 1.01 Diluted earnings per share (1) $ 0.59 $ 1.01 (1) Diluted earnings per share was computed using the treasury stock method for dilutive securities. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Accumulated Other Comprehensive Income (Loss) | The components of Accumulated Other Comprehensive Income (Loss) are as follows (in millions): Three Months Ended March 31, 2024 Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges Unrealized Gain on Pension Plans Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries Accumulated Other Comprehensive Income (Loss) Balance as of January 1, 2024 $ (243) $ (11) $ 6 $ 8 $ (240) Pretax (loss) income (57) 6 — — (51) Income tax effect — (1) — — (1) Reclassification of unrealized gain — (1) — — (1) Other comprehensive loss from unconsolidated subsidiaries — — — (5) (5) Balance as of March 31, 2024 $ (300) $ (7) $ 6 $ 3 $ (298) Three Months Ended March 31, 2023 Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges Unrealized Gain on Pension Plans Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries Accumulated Other Comprehensive Income (Loss) Balance as of January 1, 2023 $ (333) $ — $ 11 $ (1) $ (323) Pretax income (loss) 57 (22) — — 35 Income tax effect — 5 — — 5 Other comprehensive income from unconsolidated subsidiaries — — — 3 3 Balance as of March 31, 2023 $ (276) $ (17) $ 11 $ 2 $ (280) |
Long-Term Obligations (Tables)
Long-Term Obligations (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule Of Long-Term Obligations | Long-term obligations consist of the following (in millions): March 31, 2024 December 31, 2023 Maturity Date Interest Rate Amount Interest Rate Amount Senior Unsecured Credit Agreement: Term loan payable January 2026 6.81 % $ 500 6.83 % $ 500 Revolving credit facilities January 2028 6.58 % (1) 640 6.25 % (1) 914 Senior Unsecured Term Loan Agreement: Term loan payable July 2026 6.67 % 517 6.82 % 529 Unsecured Senior Notes: U.S. Notes (2028) June 2028 5.75 % 800 5.75 % 800 U.S. Notes (2033) June 2033 6.25 % 600 6.25 % 600 Euro Notes (2024) April 2024 — % — 3.88 % 552 Euro Notes (2028) April 2028 4.13 % 270 4.13 % 276 Euro Notes (2031) March 2031 4.13 % 809 — % — Notes payable Various through October 2030 3.49 % (1) 18 3.85 % (1) 16 Finance lease obligations 4.95 % (1) 85 4.83 % (1) 83 Other debt 5.73 % (1) 48 2.16 % (1) 11 Total debt 4,287 4,281 Less: long-term debt issuance costs and unamortized bond discount (38) (30) Total debt, net of debt issuance costs and unamortized bond discount 4,249 4,251 Less: current maturities, net of debt issuance costs (88) (596) Long term debt, net of debt issuance costs and unamortized bond discount $ 4,161 $ 3,655 (1) Interest rate derived via a weighted average |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments [Table Text Block] | As of March 31, 2024 and December 31, 2023, the notional amounts, balance sheet classification and fair values of our derivative instruments designated as cash flow hedges were as follows (in millions): March 31, 2024 Notional Amount Balance Sheet Caption Fair Value - Asset / (Liability) Interest rate swap agreements $ 400 Prepaid expenses and other current assets $ 1 Interest rate swap agreements 300 Other noncurrent assets 2 December 31, 2023 Notional Amount Balance Sheet Caption Fair Value - Asset / (Liability) Interest rate swap agreements $ 700 Other noncurrent liabilities $ (2) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The following table presents information about our financial assets and liabilities measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs we utilized to determine such fair value as of March 31, 2024 and December 31, 2023 (in millions): March 31, 2024 December 31, 2023 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Interest rate swaps $ — $ 3 $ — $ 3 $ — $ — $ — $ — Investments - debt securities 21 — — 21 22 — — 22 Investments - equity securities 5 — — 5 3 — — 3 Total Assets $ 26 $ 3 $ — $ 29 $ 25 $ — $ — $ 25 Liabilities: Interest rate swaps $ — $ — $ — $ — $ — $ 2 $ — $ 2 Contingent consideration liabilities — — 4 4 — — 2 2 Total Liabilities $ — $ — $ 4 $ 4 $ — $ 2 $ 2 $ 4 |
Fair Value Disclosure of Asset and Liability Not Measured at Fair Value | The following table provides the carrying and fair value for our other financial instruments as of March 31, 2024 and December 31, 2023 (in millions): As of March 31, 2024 As of December 31, 2023 Carrying Value Fair Value Carrying Value Fair Value U.S. Notes (2028) $ 800 $ 815 $ 800 $ 820 U.S. Notes (2033) 600 624 600 628 Euro Notes (2024) — — 552 552 Euro Notes (2028) 270 271 276 276 Euro Notes (2031) 809 820 — — |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Schedule Of Financial Performance By Reportable Segment | The following tables present our financial performance by reportable segment for the periods indicated (in millions): Wholesale - North America Europe Specialty Self Service Eliminations Consolidated Three Months Ended March 31, 2024 Revenue: Third Party $ 1,500 $ 1,644 $ 422 $ 137 $ — $ 3,703 Intersegment — — 1 — (1) — Total segment revenue $ 1,500 $ 1,644 $ 423 $ 137 $ (1) $ 3,703 Segment EBITDA $ 244 $ 143 $ 27 $ 16 $ — $ 430 Total depreciation and amortization (1) 49 39 8 4 — 100 Three Months Ended March 31, 2023 Revenue: Third Party $ 1,229 $ 1,555 $ 396 $ 169 $ — $ 3,349 Intersegment — — 1 — (1) — Total segment revenue $ 1,229 $ 1,555 $ 397 $ 169 $ (1) $ 3,349 Segment EBITDA $ 252 $ 151 $ 31 $ 22 $ — $ 456 Total depreciation and amortization (1) 19 34 8 4 — 65 (1) Amounts presented include depreciation and amortization expense recorded within Cost of goods sold, SG&A expenses and Restructuring and transaction related expenses. |
Reconciliation Of Net Income to Segment EBITDA | The table below provides a reconciliation of Net Income to Segment EBITDA (in millions): Three Months Ended March 31, 2024 2023 Net income $ 158 $ 270 Adjustments: Depreciation and amortization 100 65 Interest expense, net of interest income 61 33 Loss on debt extinguishment — 1 Provision for income taxes 71 94 Equity in losses (earnings) of unconsolidated subsidiaries (1) 2 (3) Gains on foreign exchange contracts - acquisition related (2) — (23) Equity investment fair value adjustments — 1 Restructuring and transaction related expenses (3) 30 18 Restructuring expenses - cost of goods sold (3) 8 — Segment EBITDA $ 430 $ 456 (1) Refer to Note 6, "Equity Method Investments" for further information. (2) Refer to Note 2, "Business Combinations" and Note 13, "Derivative Instruments and Hedging Activities" for further information. (3) Refer to Note 8, "Restructuring and Transaction Related Expenses" for further information. |
Schedule Of Capital Expenditures By Reportable Segment | The following table presents capital expenditures by reportable segment (in millions): Three Months Ended March 31, 2024 2023 Capital Expenditures Wholesale - North America $ 21 $ 20 Europe 38 33 Specialty 4 13 Self Service 3 4 Total capital expenditures $ 66 $ 70 |
Schedule Of Assets By Reportable Segment | The following table presents assets by reportable segment (in millions): March 31, 2024 December 31, 2023 Receivables, net of allowance for credit losses Wholesale - North America $ 497 $ 470 Europe 733 580 Specialty 153 107 Self Service 9 8 Total receivables, net of allowance for credit losses 1,392 1,165 Inventories Wholesale - North America 1,234 1,217 Europe 1,372 1,390 Specialty 477 475 Self Service 40 39 Total inventories 3,123 3,121 Property, plant and equipment, net Wholesale - North America 641 644 Europe 626 642 Specialty 116 118 Self Service 110 112 Total property, plant and equipment, net 1,493 1,516 Operating lease assets, net Wholesale - North America 617 615 Europe 481 494 Specialty 81 84 Self Service 135 143 Total operating lease assets, net 1,314 1,336 Other unallocated assets 7,948 7,941 Total assets $ 15,270 $ 15,079 |
Schedule Of Tangible Long-Lived Assets By Geographic Area | The following table sets forth our tangible long-lived assets by geographic area (in millions): March 31, 2024 December 31, 2023 Long-lived assets United States $ 1,488 $ 1,496 Germany 324 324 United Kingdom 299 295 Other countries 696 737 Total long-lived assets $ 2,807 $ 2,852 |
Business Combinations (Details)
Business Combinations (Details) € in Millions, $ in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2024 USD ($) | Mar. 31, 2024 EUR (€) | Sep. 30, 2023 USD ($) | Sep. 30, 2023 CAD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2023 | |
Business Combination, Separately Recognized Transactions [Line Items] | ||||||
Payment to settle Redeemable NCI, Put Option | $ 23 | € 21 | ||||
Europe | ||||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||||
Number of Businesses Acquired | 1 | 1 | 4 | |||
Specialty [Member] | ||||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||||
Number of Businesses Acquired | 1 | |||||
Wholesale - North America Segment | ||||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||||
Number of Businesses Acquired | 1 | 1 | 3 | |||
Forward Contracts | ||||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||||
Gains on foreign exchange contracts - acquisition related (1) | $ 0 | $ 23 | ||||
Proceeds from settlement of foreign exchange contracts - acquisition related | $ 49 | |||||
Uni-Select Inc. | ||||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||||
Business Combination, Consideration Transferred | $ 2,100 | $ 2,800 |
Pro Forma Effect of Businesses
Pro Forma Effect of Businesses Acquired (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Revenue | $ 3,703 | $ 3,759 |
Net income | $ 158 | 235 |
Acquisition related expenses, net of tax | 10 | |
Forward Contracts | ||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Gains on foreign exchange contracts - acquisition related | $ 23 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory [Line Items] | ||
Inventories | $ 3,123 | $ 3,121 |
AftermarketAndRefurbishedProducts [Member] | ||
Inventory [Line Items] | ||
Inventories | 2,570 | 2,556 |
SalvageAndRemanufacturedProducts [Member] | ||
Inventory [Line Items] | ||
Inventories | 499 | 510 |
ManufacturedProducts [Member] | ||
Inventory [Line Items] | ||
Inventories | 54 | 55 |
Inventory, Raw Materials and Supplies, Gross | 24 | 26 |
Inventory, Work in Process, Gross | 7 | 7 |
Inventory, Finished Goods, Gross | $ 23 | $ 22 |
Allowance for Credit Losses (De
Allowance for Credit Losses (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Credit Loss [Abstract] | |||
Accounts Receivable, Allowance for Credit Loss | $ (58) | $ (61) | |
Accounts Receivable, Credit Loss Expense (Reversal) | $ 3 | $ 5 |
Intangible Assets (Details)
Intangible Assets (Details) | Dec. 31, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 20% |
Equity Method Investments (Deta
Equity Method Investments (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments | $ 163 | $ 159 |
Mekonomen [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments | $ 152 | 145 |
Equity Method Investment, Ownership Percentage | 26.60% | |
Equity Method Investments, Fair Value Disclosure | $ 178 | |
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity | 10 | |
Other | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments | $ 11 | $ 14 |
Revenue Recognition Disaggregat
Revenue Recognition Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | $ 3,703 | $ 3,349 |
Other Revenue [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 168 | 197 |
Wholesale - North America Segment | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 1,500 | 1,229 |
Wholesale - North America Segment | Other Revenue [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 78 | 81 |
Europe | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 1,644 | 1,555 |
Europe | Other Revenue [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 7 | 7 |
Specialty [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 423 | 397 |
Self Service Segment | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 137 | 169 |
Self Service Segment | Other Revenue [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 83 | 109 |
Third Party [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 3,703 | 3,349 |
Third Party [Member] | Wholesale - North America Segment | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 1,500 | 1,229 |
Third Party [Member] | Europe | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 1,644 | 1,555 |
Third Party [Member] | Specialty [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 422 | 396 |
Third Party [Member] | Self Service Segment | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 137 | 169 |
Parts and Services [Domain] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 3,535 | 3,152 |
Parts and Services [Domain] | Wholesale - North America Segment | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 1,422 | 1,148 |
Parts and Services [Domain] | Europe | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 1,637 | 1,548 |
Parts and Services [Domain] | Specialty [Member] | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | 422 | 396 |
Parts and Services [Domain] | Self Service Segment | ||
Revenue Recognition Disaggregation of Revenue [Line Items] | ||
Revenues | $ 54 | $ 60 |
Variable Consideration (Details
Variable Consideration (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Revenue Recognition and Deferred Revenue [Abstract] | ||
Contract with Customer, Right to Recover Product | $ 72 | $ 68 |
Refund liability | 137 | 132 |
Revenue, Variable Consideration Reserve | $ 102 | $ 155 |
Revenue from External Customers
Revenue from External Customers by Geographic Areas (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue from External Customer [Line Items] | ||
Revenue | $ 3,703 | $ 3,349 |
UNITED STATES | ||
Revenue from External Customer [Line Items] | ||
Revenue | 1,795 | 1,681 |
GERMANY | ||
Revenue from External Customer [Line Items] | ||
Revenue | 425 | 416 |
UNITED KINGDOM | ||
Revenue from External Customer [Line Items] | ||
Revenue | 445 | 415 |
Other countries | ||
Revenue from External Customer [Line Items] | ||
Revenue | $ 1,038 | $ 837 |
Restructuring and Transaction_3
Restructuring and Transaction Related Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | $ 36 | $ 8 |
Business Combination, Acquisition Related Costs | 2 | 10 |
2024 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 27 | 0 |
Restructuring and Related Cost, Cost Incurred to Date | 27 | |
2024 Global Restructuring | Inventory Related Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 8 | 0 |
2024 Global Restructuring | Asset Impairments | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 17 | 0 |
2024 Global Restructuring | Other Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 2 | 0 |
2024 Global Restructuring | Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 75 | |
2024 Global Restructuring | Minimum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 55 | |
2022 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 1 | 5 |
Restructuring and Related Cost, Cost Incurred to Date | 26 | |
2022 Global Restructuring | Employee related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 0 | 2 |
2022 Global Restructuring | Facility Closing | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 1 | 2 |
2022 Global Restructuring | Other Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 0 | 1 |
2022 Global Restructuring | Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 35 | |
2022 Global Restructuring | Minimum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 28 | |
1 LKQ Europe Program [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 2 | 1 |
Restructuring and Related Cost, Cost Incurred to Date | 12 | |
1 LKQ Europe Program [Member] | Employee related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 1 | 1 |
1 LKQ Europe Program [Member] | Facility Closing | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 1 | 0 |
1 LKQ Europe Program [Member] | Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 40 | |
1 LKQ Europe Program [Member] | Minimum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost | 30 | |
Acquisition integration plans | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 6 | 2 |
Acquisition integration plans | Employee related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 1 | 0 |
Acquisition integration plans | Facility Closing | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 4 | 2 |
Acquisition integration plans | Other Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Costs | 1 | $ 0 |
Acquisition integration plans | Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost Remaining | 15 | |
Acquisition integration plans | Minimum [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Expected Cost Remaining | 5 | |
Wholesale - North America Segment | 2024 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 0 | |
Wholesale - North America Segment | 2022 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 2 | |
Wholesale - North America Segment | 1 LKQ Europe Program [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 0 | |
Europe | 2024 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 27 | |
Europe | 2022 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 17 | |
Europe | 1 LKQ Europe Program [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 12 | |
Specialty [Member] | 2024 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 0 | |
Specialty [Member] | 2022 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 4 | |
Specialty [Member] | 1 LKQ Europe Program [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 0 | |
Self Service Segment | 2024 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 0 | |
Self Service Segment | 2022 Global Restructuring | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | 3 | |
Self Service Segment | 1 LKQ Europe Program [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and Related Cost, Cost Incurred to Date | $ 0 |
Earnings Per Share, Basic and D
Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Schedule of Earnings Per Share, Basic and Diluted [Line Items] | ||
Net income | $ 158 | $ 270 |
Denominator for basic earnings per share—Weighted-average shares outstanding | 267.1 | 267.4 |
Effect of dilutive securities: | ||
Denominator for diluted earnings per share—Adjusted weighted-average shares outstanding | 267.7 | 268.3 |
Basic earnings per share | $ 0.59 | $ 1.01 |
Diluted earnings per share (1) | $ 0.59 | $ 1.01 |
RSUs | ||
Effect of dilutive securities: | ||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | 0.5 | 0.7 |
Performance Based RSU [Member] | ||
Effect of dilutive securities: | ||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | 0.1 | 0.2 |
Schedule of Accumulated Other C
Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Pretax income (loss) | $ (51) | $ 35 | ||
Income tax effect | (1) | 5 | ||
Reclassification of unrealized (gain) loss | (1) | |||
Other comprehensive income (loss) from unconsolidated subsidiaries | (5) | 3 | ||
Accumulated other comprehensive income (loss) | (298) | (280) | $ (240) | $ (323) |
Foreign Currency Translation [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Pretax income (loss) | (57) | 57 | ||
Income tax effect | 0 | 0 | ||
Reclassification of unrealized (gain) loss | 0 | |||
Other comprehensive income (loss) from unconsolidated subsidiaries | 0 | 0 | ||
Accumulated other comprehensive income (loss) | (300) | (276) | (243) | (333) |
Unrealized Gain (Loss) on Cash Flow Hedges [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Pretax income (loss) | 6 | (22) | ||
Income tax effect | (1) | 5 | ||
Reclassification of unrealized (gain) loss | (1) | |||
Other comprehensive income (loss) from unconsolidated subsidiaries | 0 | 0 | ||
Accumulated other comprehensive income (loss) | (7) | (17) | (11) | 0 |
Unrealized Gain (Loss)on Pension Plans [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Pretax income (loss) | 0 | 0 | ||
Income tax effect | 0 | 0 | ||
Reclassification of unrealized (gain) loss | 0 | |||
Other comprehensive income (loss) from unconsolidated subsidiaries | 0 | 0 | ||
Accumulated other comprehensive income (loss) | 6 | 11 | 6 | 11 |
Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Pretax income (loss) | 0 | 0 | ||
Income tax effect | 0 | 0 | ||
Reclassification of unrealized (gain) loss | 0 | |||
Other comprehensive income (loss) from unconsolidated subsidiaries | (5) | 3 | ||
Accumulated other comprehensive income (loss) | $ 3 | $ 2 | $ 8 | $ (1) |
Supply Chain Financing (Details
Supply Chain Financing (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Supplier Finance Program [Line Items] | ||
Supplier Finance Program, Obligation, Current | $ 422 | $ 411 |
Schedule of Long-Term Obligatio
Schedule of Long-Term Obligations (Details) € in Millions, $ in Millions | Mar. 31, 2024 USD ($) | Mar. 13, 2024 EUR (€) | Dec. 31, 2023 USD ($) |
Debt Instrument | |||
Finance lease obligations | $ 85 | $ 83 | |
Total debt | 4,287 | 4,281 | |
Less: long-term debt issuance costs and unamortized bond discount | (38) | (30) | |
Total debt, net of debt issuance costs and unamortized bond discount | 4,249 | 4,251 | |
Less: current maturities, net of debt issuance costs | (88) | (596) | |
Long-term debt, net of debt issuance costs and unamortized bond discount | $ 4,161 | $ 3,655 | |
Finance Lease, Weighted Average Discount Rate, Percent | 4.95% | 4.83% | |
Term loan payable | |||
Debt Instrument | |||
Term loan payable | $ 500 | $ 500 | |
Interest rate | 6.81% | 6.83% | |
Senior Unsecured Credit Agreement | |||
Debt Instrument | |||
Revolving credit facilities | $ 640 | $ 914 | |
Weighted average interest rates | 6.58% | 6.25% | |
Senior Unsecured Term Loan Credit Agreement (CAD Note) | |||
Debt Instrument | |||
Term loan payable | $ 517 | $ 529 | |
Interest rate | 6.67% | 6.82% | |
U.S. Notes (2028) | |||
Debt Instrument | |||
Long-term Debt | $ 800 | $ 800 | |
Interest rate | 5.75% | 5.75% | |
U.S. Notes (2033) | |||
Debt Instrument | |||
Long-term Debt | $ 600 | $ 600 | |
Interest rate | 6.25% | 6.25% | |
Euro Notes (2024) | |||
Debt Instrument | |||
Long-term Debt | $ 0 | $ 552 | |
Interest rate | 0% | 3.875% | 3.88% |
Euro Notes (2028) | |||
Debt Instrument | |||
Long-term Debt | $ 270 | $ 276 | |
Interest rate | 4.13% | 4.13% | |
Euro Notes (2031) | |||
Debt Instrument | |||
Long-term Debt | $ 809 | € 750 | $ 0 |
Interest rate | 4.13% | 4.125% | 0% |
Notes Payable | |||
Debt Instrument | |||
Notes Payable | $ 18 | $ 16 | |
Weighted average interest rates | 3.49% | 3.85% | |
Other Debt | |||
Debt Instrument | |||
Other Debt | $ 48 | $ 11 | |
Weighted average interest rates | 5.73% | 2.16% |
Long-Term Obligations - Additio
Long-Term Obligations - Additional Information (Details) € in Millions, $ in Millions, $ in Millions | 3 Months Ended | ||||
Mar. 31, 2024 USD ($) | Mar. 13, 2024 EUR (€) | Dec. 31, 2023 USD ($) | Mar. 27, 2023 CAD ($) | Jan. 05, 2023 USD ($) | |
Euro Notes (2024) | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Long-term Debt | $ 0 | $ 552 | |||
Interest rate | 0% | 3.875% | 3.88% | ||
Euro Notes (2028) | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Long-term Debt | $ 270 | $ 276 | |||
Interest rate | 4.13% | 4.13% | |||
U.S. Notes (2028) | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Long-term Debt | $ 800 | $ 800 | |||
Interest rate | 5.75% | 5.75% | |||
U.S. Notes (2033) | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Long-term Debt | $ 600 | $ 600 | |||
Interest rate | 6.25% | 6.25% | |||
Senior Unsecured Term Loan Credit Agreement (CAD Note) | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Term loan payable | $ 517 | $ 529 | |||
Interest rate | 6.67% | 6.82% | |||
Senior Unsecured Term Loan Credit Agreement (CAD Note) | Uni-Select Inc. | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Term loan payable | $ 700 | ||||
Euro Notes (2031) | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Long-term Debt | $ 809 | € 750 | $ 0 | ||
Interest rate | 4.13% | 4.125% | 0% | ||
Debt Instrument, Fee Amount | $ 7 | ||||
Debt Instrument, Redemption Price, Percentage | 100% | ||||
Senior Unsecured Credit Agreement | Revolving Credit Facility | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,000 | ||||
Sublimit for the Issuance of Letters of Credit | 150 | ||||
Sublimit for the Issuance of Swing Line Loans | 150 | ||||
Unsecured Term Loan Facility | $ 500 | ||||
Twenty Twenty Four [Domain] | Euro Notes (2024) | |||||
Long-Term Obligations - Additional Information [Line Items] | |||||
Long-term Debt | € | € 500 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities (Details) $ in Millions, $ in Millions | 3 Months Ended | |||||||
Mar. 31, 2024 USD ($) | Sep. 30, 2023 USD ($) | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Mar. 15, 2023 USD ($) | Mar. 15, 2023 CAD ($) | Feb. 17, 2023 USD ($) | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Interest Rate Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months, Net | $ 1 | |||||||
Forward Contracts | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, Notional Amount | $ 1,200 | $ 1,600 | ||||||
Gains on foreign exchange contracts - acquisition related | 0 | $ 23 | ||||||
Proceeds from settlement of foreign exchange contracts - acquisition related | $ 49 | |||||||
Interest Rate Swap [Member] | Interest Rate Swap Maturing in February 2025 | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, Notional Amount | $ 400 | |||||||
Derivative, Average Fixed Interest Rate | 4.63% | |||||||
Interest Rate Swap [Member] | Interest Rate Swap Maturing in February 2026 | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, Notional Amount | $ 300 | |||||||
Derivative, Average Fixed Interest Rate | 4.23% | |||||||
Interest Rate Swap [Member] | Prepaid Expenses and Other Current Assets | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, Notional Amount | 400 | |||||||
Interest Rate Swap [Member] | Other Noncurrent Liabilities | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, Notional Amount | $ 700 | |||||||
Interest Rate Swap [Member] | Other Noncurrent Assets | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, Notional Amount | 300 | |||||||
Forward starting interest rate swaps | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Settlement of derivative instruments | $ 13 | |||||||
Fair Value, Recurring [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | (4) | (4) | ||||||
Assets, Fair Value Disclosure | 29 | 25 | ||||||
Fair Value, Recurring [Member] | Contingent Consideration Liabilities [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | (4) | (2) | ||||||
Fair Value, Recurring [Member] | Interest Rate Swap [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | (2) | |||||||
Assets, Fair Value Disclosure | 3 | |||||||
Fair Value, Inputs, Level 3 [Member] | Fair Value, Recurring [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | (4) | (2) | ||||||
Fair Value, Inputs, Level 3 [Member] | Fair Value, Recurring [Member] | Contingent Consideration Liabilities [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | (4) | (2) | ||||||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | 0 | (2) | ||||||
Assets, Fair Value Disclosure | 3 | 0 | ||||||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | Interest Rate Swap [Member] | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | 0 | (2) | ||||||
Assets, Fair Value Disclosure | 3 | 0 | ||||||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | Interest Rate Swap [Member] | Prepaid Expenses and Other Current Assets | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Assets, Fair Value Disclosure | 1 | |||||||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | Interest Rate Swap [Member] | Other Noncurrent Liabilities | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Liabilities, Fair Value Disclosure | $ (2) | |||||||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | Interest Rate Swap [Member] | Other Noncurrent Assets | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Assets, Fair Value Disclosure | $ 2 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) € in Millions, $ in Millions | Mar. 31, 2024 USD ($) | Mar. 13, 2024 EUR (€) | Dec. 31, 2023 USD ($) |
Fair Value, Recurring [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | $ 29 | $ 25 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 4 | 4 | |
Fair Value, Recurring [Member] | Interest Rate Swap [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 3 | ||
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 2 | ||
Fair Value, Recurring [Member] | Debt Securities | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 21 | 22 | |
Fair Value, Recurring [Member] | Equity Securities | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 5 | 3 | |
Fair Value, Recurring [Member] | Contingent Consideration Liabilities [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 4 | 2 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 26 | 25 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Debt Securities | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 21 | 22 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Equity Securities | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 5 | 3 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 3 | 0 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 0 | 2 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Assets, Fair Value Disclosure | 3 | 0 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 0 | 2 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 4 | 2 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Contingent Consideration Liabilities [Member] | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 4 | 2 | |
Senior Unsecured Credit Agreement | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Long-term Line of Credit | 1,140 | 1,414 | |
Senior Unsecured Term Loan Credit Agreement (CAD Note) | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Term loan payable | 517 | 529 | |
U.S. Notes (2028) | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Long-term Debt | 800 | 800 | |
Long-term Debt, Fair Value | 815 | 820 | |
U.S. Notes (2033) | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Long-term Debt | 600 | 600 | |
Long-term Debt, Fair Value | 624 | 628 | |
Euro Notes (2024) | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Long-term Debt | 0 | 552 | |
Long-term Debt, Fair Value | 0 | 552 | |
Euro Notes (2028) | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Long-term Debt | 270 | 276 | |
Long-term Debt, Fair Value | 271 | 276 | |
Euro Notes (2031) | |||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||
Long-term Debt | 809 | € 750 | $ 0 |
Long-term Debt, Fair Value | $ 820 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Funded (Unfunded) Status of Plan | $ (80) | $ (83) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Effective Income Tax Rate Reconciliation, Percent | 30.70% | 26.10% |
Effective Income Tax Rate Reconciliation, Change as a result of the Discrete Items, Percent | 4.40% | |
Pillar Two Global Minimum Corporate Tax | 15% |
Segment and Geographic Inform_3
Segment and Geographic Information - Additional Information (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | |
Segment Reporting Information | ||
Revenue | $ 3,703 | $ 3,349 |
Segment EBITDA | 430 | 456 |
Depreciation and amortization | $ 100 | 65 |
Number of operating segments | 4 | |
Third Party [Member] | ||
Segment Reporting Information | ||
Revenue | $ 3,703 | 3,349 |
Intersegment [Member] | ||
Segment Reporting Information | ||
Revenue | 0 | 0 |
Wholesale - North America Segment | ||
Segment Reporting Information | ||
Revenue | 1,500 | 1,229 |
Segment EBITDA | 244 | 252 |
Depreciation and amortization | 49 | 19 |
Wholesale - North America Segment | Third Party [Member] | ||
Segment Reporting Information | ||
Revenue | 1,500 | 1,229 |
Wholesale - North America Segment | Intersegment [Member] | ||
Segment Reporting Information | ||
Revenue | 0 | 0 |
Europe | ||
Segment Reporting Information | ||
Revenue | 1,644 | 1,555 |
Segment EBITDA | 143 | 151 |
Depreciation and amortization | 39 | 34 |
Europe | Third Party [Member] | ||
Segment Reporting Information | ||
Revenue | 1,644 | 1,555 |
Europe | Intersegment [Member] | ||
Segment Reporting Information | ||
Revenue | 0 | 0 |
Specialty [Member] | ||
Segment Reporting Information | ||
Revenue | 423 | 397 |
Segment EBITDA | 27 | 31 |
Depreciation and amortization | 8 | 8 |
Specialty [Member] | Third Party [Member] | ||
Segment Reporting Information | ||
Revenue | 422 | 396 |
Specialty [Member] | Intersegment [Member] | ||
Segment Reporting Information | ||
Revenue | 1 | 1 |
Self Service Segment | ||
Segment Reporting Information | ||
Revenue | 137 | 169 |
Segment EBITDA | 16 | 22 |
Depreciation and amortization | 4 | 4 |
Self Service Segment | Third Party [Member] | ||
Segment Reporting Information | ||
Revenue | 137 | 169 |
Self Service Segment | Intersegment [Member] | ||
Segment Reporting Information | ||
Revenue | 0 | 0 |
us-gaap_IntersegmentEliminationMember | ||
Segment Reporting Information | ||
Revenue | (1) | (1) |
Segment EBITDA | 0 | 0 |
Depreciation and amortization | 0 | 0 |
us-gaap_IntersegmentEliminationMember | Third Party [Member] | ||
Segment Reporting Information | ||
Revenue | 0 | 0 |
us-gaap_IntersegmentEliminationMember | Intersegment [Member] | ||
Segment Reporting Information | ||
Revenue | $ (1) | $ (1) |
Reconciliation Of Net Income to
Reconciliation Of Net Income to Segment EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Reconciliation of Net Income to Segment EBITDA Table [Line Items] | ||
Net income | $ 158 | $ 270 |
Depreciation and amortization | 100 | 65 |
Interest expense, net of interest income | 61 | 33 |
Loss on debt extinguishment | 0 | 1 |
Provision for income taxes | 71 | 94 |
Equity in losses (earnings) of unconsolidated subsidiaries (1) | 2 | (3) |
Equity investment fair value adjustments | 0 | 1 |
Restructuring and transaction related expenses (3) | 30 | 18 |
Restructuring expenses - cost of goods sold (3) | 8 | 0 |
Segment EBITDA | 430 | 456 |
Forward Contracts | ||
Reconciliation of Net Income to Segment EBITDA Table [Line Items] | ||
Gains on foreign exchange contracts - acquisition related | $ 0 | $ (23) |
Schedule of Capital Expenditure
Schedule of Capital Expenditures by Reportable Segment (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Segment Reporting Information | ||
Capital Expenditures | $ 66 | $ 70 |
Wholesale - North America Segment | ||
Segment Reporting Information | ||
Capital Expenditures | 21 | 20 |
Europe | ||
Segment Reporting Information | ||
Capital Expenditures | 38 | 33 |
Specialty [Member] | ||
Segment Reporting Information | ||
Capital Expenditures | 4 | 13 |
Self Service Segment | ||
Segment Reporting Information | ||
Capital Expenditures | $ 3 | $ 4 |
Schedule of Assets by Reportabl
Schedule of Assets by Reportable Segment (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Segment Reporting Information | ||
Receivables, net of allowance for credit losses | $ 1,392 | $ 1,165 |
Inventories | 3,123 | 3,121 |
Property, plant and equipment, net | 1,493 | 1,516 |
Operating lease assets, net | 1,314 | 1,336 |
Other unallocated assets | 7,948 | 7,941 |
Total assets | 15,270 | 15,079 |
Wholesale - North America Segment | ||
Segment Reporting Information | ||
Receivables, net of allowance for credit losses | 497 | 470 |
Inventories | 1,234 | 1,217 |
Property, plant and equipment, net | 641 | 644 |
Operating lease assets, net | 617 | 615 |
Europe | ||
Segment Reporting Information | ||
Receivables, net of allowance for credit losses | 733 | 580 |
Inventories | 1,372 | 1,390 |
Property, plant and equipment, net | 626 | 642 |
Operating lease assets, net | 481 | 494 |
Specialty [Member] | ||
Segment Reporting Information | ||
Receivables, net of allowance for credit losses | 153 | 107 |
Inventories | 477 | 475 |
Property, plant and equipment, net | 116 | 118 |
Operating lease assets, net | 81 | 84 |
Self Service Segment | ||
Segment Reporting Information | ||
Receivables, net of allowance for credit losses | 9 | 8 |
Inventories | 40 | 39 |
Property, plant and equipment, net | 110 | 112 |
Operating lease assets, net | $ 135 | $ 143 |
Schedule of Tangible Long-Lived
Schedule of Tangible Long-Lived Assets by Geographic Area (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Long-Lived Assets | ||
Long-Lived Assets | $ 2,807 | $ 2,852 |
UNITED STATES | ||
Long-Lived Assets | ||
Long-Lived Assets | 1,488 | 1,496 |
GERMANY | ||
Long-Lived Assets | ||
Long-Lived Assets | 324 | 324 |
UNITED KINGDOM | ||
Long-Lived Assets | ||
Long-Lived Assets | 299 | 295 |
Other countries | ||
Long-Lived Assets | ||
Long-Lived Assets | $ 696 | $ 737 |