Inventories, Contracts in Progress and Vehicle Floor Plan Payable

12 Months Ended

Dec. 31, 2019

Inventories, Contracts in Progress And Vehicle Floor Plan Payable [Abstract]

Inventories, Contracts in Progress and Vehicle Floor Plan Payable

INVENTORIES, CONTRACTS IN PROGRESS AND VEHICLE FLOOR PLAN PAYABLE

Inventories and contracts in progress consist of the following:

	As of December 31
(in thousands)	2019		2018
Raw materials	$	35,119	$	37,248
Work-in-process	10,775		11,633
Finished goods	58,696		17,861
Contracts in progress	4,338		2,735
	$	108,928	$	69,477

The Company finances all new vehicle inventory through a standardized floor plan facility (the “floor plan facility”) with SunTrust Bank. The new vehicle floor plan facility bears interest at variable rates that are based on LIBOR plus 1.15% per annum. The weighted average interest rate for the floor plan facility was 3.3% for year ended December 31, 2019. As of December 31, 2019, the aggregate capacity under the floor plan facility was $50 million, of which $40.1 million had been utilized, and is included in accounts payable and accrued liabilities in the Consolidated Balance Sheet. Changes in the vehicle floor plan payable are reported as cash flows from financing activities in the Consolidated Statements of Cash Flows.

The floor plan facility is collateralized by vehicle inventory and other assets of the relevant dealership subsidiary, and contains a number of covenants, including, among others, covenants restricting the dealership subsidiary with respect to the creation of liens and changes in ownership, officers and key management personnel. The Company was in compliance with all of these restrictive covenants as of December 31, 2019.

The floor plan interest expense related to the new vehicle floor plan arrangements is offset by amounts received from manufacturers in the form of floor plan assistance capitalized in inventory and recorded against operating

expense in the Consolidated Statements of Operations when the associated inventory is sold. For the year ended December 31, 2019, the Company recognized a reduction in operating expense of $1.8 million related to manufacturer floor plan assistance.