LITHIA MOTORS INCLAD
LITHIA MOTORS INC Debt Disclosure
CREDIT FACILITIES AND LONG-TERM DEBT
Below is a summary of our outstanding balances on credit facilities and long-term debt:
| December 31, | |||||||||||||||||
| ($ in millions) | Maturity Dates | 2025 | 2024 | ||||||||||||||
| Long-term debt: | |||||||||||||||||
| Used and service loaner vehicle inventory financing commitments | Various dates through Feb 2029 | $ | 1,043.0 | $ | 975.3 | ||||||||||||
| Revolving lines of credit | Various dates through Feb 2029 | 1,570.8 | 1,633.2 | ||||||||||||||
| Warehouse facilities | Various dates through Dec 2027 | 1,251.0 | 834.0 | ||||||||||||||
| Non-recourse notes payable | Various dates through Mar 2033 | 2,473.9 | 2,109.3 | ||||||||||||||
4.625% Senior notes due 2027 | Dec 2027 | 400.0 | 400.0 | ||||||||||||||
3.875% Senior notes due 2029 | Jun 2029 | 800.0 | 800.0 | ||||||||||||||
5.500% Senior notes due 2030 | Oct 2030 | 600.0 | — | ||||||||||||||
4.375% Senior notes due 2031 | Jan 2031 | 550.0 | 550.0 | ||||||||||||||
| Real estate mortgages, finance lease obligations, and other debt | Various dates through Oct 2045 | 1,152.1 | 1,085.9 | ||||||||||||||
| Total long-term debt | 9,840.8 | 8,387.7 | |||||||||||||||
| Less: unamortized debt issuance costs | (27.8) | (25.1) | |||||||||||||||
| Less: current maturities (net of current debt issuance costs) | (133.9) | (192.1) | |||||||||||||||
| Long-term debt, net | $ | 9,679.1 | $ | 8,170.5 | |||||||||||||
Credit Facilities
US Bank Syndicated Credit Facility
On August 6, 2025 we amended our existing syndicated credit facility (USB credit facility), comprised of 20 financial institutions, including seven manufacturer-affiliated finance companies, maturing February 23, 2029. The amendment increased the total financing commitment and the amount to which the commitment could be further expanded.
This USB credit facility provides for a total financing commitment of $6.5 billion, which may be further expanded, subject to lender approval and the satisfaction of other conditions, up to a total of $7.0 billion. The allocation of the financing commitment is for up to $3.0 billion in new vehicle inventory floorplan financing, up to $900 million in used vehicle inventory floorplan financing, up to $100 million in service loaner vehicle floorplan financing, and up to $2.5 billion in revolving financing for general corporate purposes, including acquisitions and working capital. We have the option to reallocate the commitments under this USB credit facility, provided that the aggregate revolving loan commitment may not be more than 50% of the amount of the aggregate commitment, and the aggregate service loaner vehicle floorplan commitment may not be more than the 3% of the amount of the aggregate commitment. All borrowings from, and repayments to, our lending group are presented in the Consolidated Statements of Cash Flows as financing activities.
Our obligations under our USB credit facility are secured by a substantial amount of our assets, including our inventory (including new and used vehicles, parts and accessories), equipment, accounts receivable (and other rights to payment), and our equity interests in certain of our subsidiaries.
The interest rate on the USB credit facility varies based on the type of debt, with the rate of one-day SOFR plus a credit spread adjustment of 0.10% plus a margin of 1.10% for new vehicle floor plan financing, 1.40% for used vehicle floor plan financing, 1.20% for service loaner floor plan financing, and a variable interest rate on the revolving financing ranging from 1.00% to 2.00% depending on our leverage ratio. The annual interest rates associated with our commitments are as follows:
| Commitment | Annual Interest Rate at December 31, 2025 | ||||
| New vehicle floor plan | 5.07% | ||||
| Used vehicle floor plan | 5.37% | ||||
| Service loaner floor plan | 5.17% | ||||
| Revolving line of credit | 5.22% | ||||
Under the terms of our USB credit facility, we are subject to financial covenants and restrictive covenants that limit or restrict our incurring additional indebtedness, making investments, selling or acquiring assets and granting security interests in our assets.
Bank of Nova Scotia Syndicated Credit Facility
Our syndicated credit agreement with the Bank of Nova Scotia as agent (BNS credit facility) is comprised of six financing institutions, including two manufacturer-affiliated finance companies.
The BNS credit facility provides for a total financing commitment of approximately $1.1 billion CAD, including a working capital revolving credit facility of up to $125 million CAD, a wholesale flooring facility for new vehicles up to $500 million CAD, used vehicle flooring facility of up to $75 million CAD, wholesale leasing facility of up to $400 million CAD, and daily rental vehicle facility up to $25 million CAD.
The interest rate on the BNS credit facility varies based on the type of debt, with the daily compound rate of the Canadian Overnight Repo Rate Average (CORRA) plus a credit spread adjustment of 0.30% plus a margin of 1.00% for the wholesale flooring facility, 1.25% for the used vehicle flooring facility, 1.20% for the daily rental facility, 1.30% for the wholesale leasing facility, and a variable interest rate on the working capital revolving facility ranging from 1.25% to 2.25% depending on our leverage ratio. The annual interest rates associated with our commitments are as follows:
| Commitment | Annual Interest Rate at December 31, 2025 | ||||
| Wholesale flooring facility | 3.60% | ||||
| Used vehicle flooring facility | 3.85% | ||||
| Daily rental facility | 3.80% | ||||
| Wholesale leasing facility | 3.90% | ||||
| Working capital revolving facility | 3.85% | ||||
All BNS facilities other than the wholesale flooring facility, which is a demand facility, mature on March 18, 2027. Under the terms of our BNS credit facility, we are subject to compliance with various financial covenants.
Bank of America Revolving Credit Facility
On April 1, 2025, we amended our revolving credit facility agreement with Bank of America. The amendment increased the commitment to £150.0 million GBP. The maturity date is February 22, 2029 and the interest rate on the working capital line of credit is based on the Sterling Overnight Index Average (SONIA) plus 1.45%. The annual interest rate at December 31, 2025 was 5.18%.
JPM Warehouse facility
On December 9, 2025, we amended our securitization facility for our finance receivable portfolio (JPM warehouse facility) with JPMorgan Chase Bank, as administrative agent and account bank, providing initial commitments for borrowings of up to $1.0 billion and extending the maturity to December 9, 2027. The amendment adjusted the interest rate on the JPM warehouse facility varies based on the Daily Simple SOFR rate plus 0.85% to 1.80% and added Wells Fargo Bank as an additional lender.
Mizuho Warehouse facility
On August 1, 2025, we amended our securitization facility for our finance receivable portfolio (Mizuho warehouse facility), with Mizuho Bank Ltd., as administrative agent and account bank, providing initial commitments for
borrowings of up to $1 billion and extending the maturity to July 30, 2027. The amendment adjusted the interest rate on the Mizuho warehouse facility to the Daily Simple SOFR rate plus 0.85% to 0.95% and added Bank of America as an additional lender.
Floor Plan Notes Payable
We have floor plan agreements with manufacturer-affiliated finance companies and other lenders with direct manufacturer and vendor partnerships for certain new and used vehicles that have not been financed through our new vehicle credit facilities or third-party finance companies. The interest rates on these floor plan notes payable commitments vary by manufacturer and are variable rates ranging from 5.37% to 6.75% as of December 31, 2025. Borrowings from and repayments to manufacturer-affiliated finance companies are classified as operating activities in the Consolidated Statements of Cash Flows.
Floor Plan Notes Payable: Non-Trade
We have floor plan agreements with third-party finance companies for certain new and used vehicles that have not been financed through our new vehicle credit facilities or manufacturer finance companies. The interest rates on these floor plan notes payable non-trade commitments vary by lender and are variable rates ranging from 3.60% to 8.50% as of December 31, 2025. Borrowing from and repayments to third-party finance companies are classified as financing activities in the Consolidated Statements of Cash Flows.
See Note 3 – Inventories and Floor Plan Notes Payable for more information on our floor plan commitments outstanding as of December 31, 2025.
Non-Recourse Notes Payable
DFC finance receivables are temporarily funded through our warehouse facilities until they can be funded through non-recourse asset-backed term transactions. These non-recourse funding vehicles are structured to legally isolate the finance receivables, and we would not expect to be able to access the assets of our non-recourse funding vehicles, even in insolvency, receivership or conservatorship proceedings. Similarly, the investors in the non-recourse notes payable have no recourse to our assets beyond the related receivables, the amounts on deposit in reserve accounts and the restricted cash from collections on finance receivables. We do, however, continue to have the rights associated with the interest we retain in these non-recourse funding vehicles.
In 2025, we issued $1.7 billion in non-recourse notes payable related to quarterly asset-backed term funding transactions. Below is a summary of outstanding non-recourse notes payable issued:
| ($ in millions) | Balance as of December 31, 2025 | Initial Principal Amount | Issuance Date | Interest Rate Range | Final Distribution Date | ||||||||||||
LAD Auto Receivables Trust 2022-1 Class A-C | 29.7 | 298.1 | 08/17/22 | 5.87% to 6.85% | Various dates through Apr 2030 | ||||||||||||
LAD Auto Receivables Trust 2023-1 Class A-D | 68.3 | 479.7 | 02/14/23 | 5.59% to 7.30% | Various dates through Jun 2030 | ||||||||||||
LAD Auto Receivables Trust 2023-2 Class A-D | 111.7 | 556.7 | 05/24/23 | 5.42% to 6.30% | Various dates through Feb 2031 | ||||||||||||
LAD Auto Receivables Trust 2023-3 Class A-D | 112.2 | 415.4 | 08/23/23 | 5.95% to 6.92% | Various dates through Dec 2030 | ||||||||||||
LAD Auto Receivables Trust 2023-4 Class A-D | 132.2 | 421.2 | 11/15/23 | 6.10% to 7.37% | Various dates through Apr 2031 | ||||||||||||
| LAD Auto Receivables Trust 2024-1 Class A-D | 122.7 | 329.4 | 02/14/24 | 5.17% to 6.15% | Various dates through Jun 2031 | ||||||||||||
| LAD Auto Receivables Trust 2024-2 Class A-D | 192.0 | 409.6 | 06/20/24 | 5.46% to 6.37% | Various dates through Oct 2031 | ||||||||||||
| LAD Auto Receivables Trust 2024-3 Class A-D | 343.7 | 614.9 | 11/15/24 | 4.52% to 5.18% | Various dates through Feb 2032 | ||||||||||||
| LAD Auto Receivables Trust 2025-1 Class A-D | 371.0 | 564.0 | 02/12/25 | 4.60% to 5.52% | Various dates through May 2032 | ||||||||||||
| LAD Auto Receivables Trust 2025-2 Class A-D | 444.7 | 531.3 | 08/13/25 | 4.25% to 5.01% | Various dates through Dec 2032 | ||||||||||||
LAD Auto Receivables Trust 2025-3 Class A-C | 545.7 | 583.2 | 11/04/25 | 4.03% to 4.60% | Various dates through Mar 2033 | ||||||||||||
| Total non-recourse notes payable | $ | 2,473.9 | $ | 5,203.5 | |||||||||||||
Senior Notes
In 2025, we issued $600.0 million in Senior Notes on September 10, 2025. Below is a summary of outstanding senior notes issued:
| ($ in millions) | Principal Amount | Earliest Redemption Date | % Currently Redeemable | Current Redemption Price | Maturity Date | Interest Payment Dates | ||||||||||||||
4.625% Senior notes due 2027 | $400.0 | 12/15/22 | 100% | 100.000% | 12/15/27 | Jun 15, Dec 15 | ||||||||||||||
3.875% Senior notes due 2029 | 800.0 | 06/01/24 | 100% | 100.969% | 06/01/29 | Jun 1, Dec 1 | ||||||||||||||
5.500% Senior notes due 2030 | 600.0 | 10/01/27 | 40% | 105.500% | 10/01/30 | Apr 1, Oct 1 | ||||||||||||||
4.375% Senior notes due 2031 | 550.0 | 10/15/25 | 100% | 102.188% | 01/15/31 | Jan 15, Jul 15 | ||||||||||||||
| Total senior notes | $2,350.0 | |||||||||||||||||||
Real Estate Mortgages, Finance Lease Obligations, and Other Debt
We have mortgages associated with our owned real estate. Interest rates related to this debt ranged from 3.0% to 7.6% at December 31, 2025. We have $1,039.5 million in mortgages outstanding as of December 31, 2025, which are payable in various installments through October 1, 2045. As of December 31, 2025, we had fixed interest rates on 59.4% of our outstanding mortgage debt.
We have $112.4 million of finance lease obligations with some of our leased real estate as of December 31, 2025. Interest rates related to this debt ranged from 2.5% to 8.5% at December 31, 2025. The leases have terms extending through August 2037.
Our other debt includes a variety of miscellaneous notes payable and bank overdrafts. The interest rates associated with our other debt ranged from 5.0% to 8.0% at December 31, 2025. This debt, which totaled $0.4 million at December 31, 2025, is due in various installments through April 1, 2027. Bank overdraft activity is included as a component of “Other financing activities” within the Consolidated Statements of Cash Flows.
Future Principal Payments
The schedule of future principal payments associated with real estate mortgages, finance lease liabilities, our senior notes, and other debt as of December 31, 2025 was as follows:
| Year Ending December 31, | ($ in millions) | ||||
| 2026 | $ | 71.6 | |||
| 2027 | 536.5 | ||||
| 2028 | 124.0 | ||||
| 2029 | 889.4 | ||||
| 2030 | 738.9 | ||||
| Thereafter | 1,141.7 | ||||
| Total principal payments | $ | 3,502.1 | |||
This table does not include future payments related to revolving lines of credit or non-recourse notes payable.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 24, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 24, 2023 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.