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Response Letter

 January 22, 2008

 Mr. H. Christopher Owings

 Assistant Director

 Division of Corporation Finance

 United States Securities and Exchange Commission

 100 F Street NE

 Washington, D.C. 20549

RE:
Asbury Automotive Group, Inc.

Form 10-K for Fiscal Year Ended December 31, 2006

Filed March 8, 2007

Form 10-K/A for Fiscal Year Ended December 31, 2006

Filed March 12, 2007

Form 10-Q for Fiscal Quarter Ended September 30, 2007

Filed November 7, 2007

File No. 001-31262

 Dear Mr. Owings:

 We have reviewed the comments in your letter dated December 27, 2007 (referred to as the “Comment Letter”) regarding Asbury Automotive
Group, Inc.’s Annual Report on Forms 10-K and 10-K/A for the year ended December 31, 2006 (collectively referred to as our “Annual Report”), and our quarterly filings on Form 10-Q. Our responses are set forth below. For your
convenience, we have included the text of your comments in bold prior to our related responses.

 Form 10-K/A for the fiscal year ended
December 31, 2006

 Related Party Transactions, page 64

1.
Please revise future filings to identify the parties instead of referring to “[c]ertain of our directors,” “four directors”, “members of our board of
directors,” etc. See Item” 404(a) of Regulation S-K. Alternatively, please include all related person disclosure in one location in the Form 10-K or incorporate it by reference from your proxy statement, as we note the description
of related person transactions with Messrs. McLarty, III, Wooley, Tomm and Jordan, Jr. beginning on page 34 of your proxy statement.

 We respectfully advise the Staff that we will incorporate our related person transactions by reference from our proxy statement in our future filings.

 Mr. H. Christopher Owings, Assistant Director

 The
Division of Corporation Finance

 U.S. Securities & Exchange Commission

 January 22, 2008

 Page
 2

Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, page 34

 Results of Operations, page 36

2.
Please tell us the nature and amount of items included in divestiture income and expenses disclosed in your discussion of discontinued operations on pages 45 and 54 and how these
items are reflected in the table in note 16 on page 96. Also explain to us why these expenses are properly reported in discontinued operations.

 We respectfully advise the Staff that the divestiture income and expenses disclosed on pages 45 and 54 are presented net of tax and the items included in the table on page 96 above “income tax benefit
(expense)” are presented pre-tax. The divestiture income and expenses included on pages 45 and 54 are items that were recognized directly as a result of the divestiture of the related franchises. Net income (loss) from sold or closed
franchises, net of tax included on pages 45 and 54 represent the operating results of the franchises sold or closed.

 Below is a
reconciliation between (i) the gain (loss) on disposition of discontinued operations disclosed in note 16 on page 96, and (ii) divestiture income (expense) disclosed on pages 45 and 54. We included the costs below in discontinued
operations because (i) each cost was directly related to an asset group whose operations and cash flows were eliminated from our company through a sale to an independent third-party, and (ii) we had no significant continuing involvement in
the operations of the asset group after the sale.

2006

2005

2004

 Gain (loss) on disposition of discontinued operations

$
1,508

$
637

$
(79
)

 Tax benefit from the stock sale of an Oregon dealership (a)

—

8,759

—

 Write-down of franchise rights,

 net of tax (b)

(1,121
)

(625
)

—

 Market value rent adjustments, net of tax (c)

(922
)

—

—

 Tax effect of gain (loss) on disposition (d)

(536
)

(239
)

30

 Book in excess of tax goodwill (e)

(380
)

(413
)

(574
)

 Other, net of tax (f)

(288
)

(258
)

(34
)

 Divestiture income (expense), net of tax

$
(1,739
)

$
7,861

$
(657
)

(a)
Represents the tax benefit associated with the stock sale of an Oregon dealership, in which we had no continuing involvement in after the sale. This amount is reflected in
“Income tax (benefit) expense,” on page 96.

 Mr. H. Christopher Owings, Assistant Director

 The Division of Corporation Finance

 U.S. Securities & Exchange Commission

 January 22, 2008

 Page
 3

(b)
Represents the write-down of manufacturer franchise rights upon entering into a sale agreement for the related franchise. These amounts are reflected in “Other expense,
net,” on page 96.

(c)
Represents the present value of the excess of (i) the remaining lease payments under a lease agreement for dealership real estate related to a franchise we no longer operate
and have no continuing involvement in and (ii) the estimated fair market value of sub-lease income for the aforementioned dealership real estate. These amounts are reflected in “Other expense, net,” on page 96.

(d)
Represents the tax impact of the gain (loss) on disposition of discontinued operations. These amounts are reflected in “Income tax benefit (expense),” on page 96.

(e)
Represents the tax expense associated with the write-off of the deferred taxes associated with book goodwill being in excess of tax goodwill. These amounts are reflected in
“Income tax (benefit) expense,” on page 96.

(f)
Represents miscellaneous, immaterial costs associated with divestitures, including severance, legal and property and equipment disposal costs. These amounts are reflected in
“Operating expenses,” and “Other expense, net,” on page 96.

 Liquidity and Capital Resources, Page 54

 Cash Flow, page 59

3.
Please explain to us why you believe your presentation of cash provided by operating activities, as adjusted, and cash (used in) provided by financing activities, as adjusted, is
not prohibited by Item 10(e)(1)(ii)(A) of Regulation S-K.

 We respectfully believe that our presentation of cash
provided by operating activities, as adjusted, is not prohibited by Item 10(e)(1)(ii)(A) of Regulation S-K because we are not excluding any charges or liabilities from this non-GAAP liquidity measure. Rather we are including in this measure
inflows and outflows from our non-manufacturer affiliated floor plan facilities, which are otherwise stated under financing activities in our statement of cash flows.

 Mr. H. Christopher Owings, Assistant Director

 The
Division of Corporation Finance

 U.S. Securities & Exchange Commission

 January 22, 2008

 Page
 4

 We did not present cash (used in) provided by financing activities, as adjusted, as a measure of our
performance, financial position or cash flows. Instead, we presented this figure solely to show the source of the amount stated as “Floor plan notes payable – non-manufacturer affiliated” in our reconciliation of adjusted cash
provided by (used in) operating activities (i.e., the difference between Floor plan borrowings – non-manufacturer affiliated and Floor plan repayments – non-manufacturer affiliated).

 As further basis for our presentation of cash provided by operating activities, as adjusted, we respectfully advise the Staff of the following additional
information. Cash flows related to floor plan notes payable included in operating activities differ from cash flows related to floor plan notes payable included in financing activities only to the extent that the former are cash flows related to
amounts payable to a lender affiliated with the manufacturer from which we purchased the related inventory while the latter are cash flows related to amounts payable to a lender not affiliated with the manufacturer from which we purchased the
related inventory. In managing our business, we do not make a distinction between affiliated and non-affiliated lenders and as such, we look at floor plan on a combined basis for both liquidity and operating purposes.

 Floor plan borrowings are required by all vehicle manufacturers for the purchase of new vehicles, and all floor plan providers require amounts borrowed
for the purchase of a vehicle to be repaid immediately after that vehicle is sold. As a result, we believe that it is extremely important for investors, analysts and rating agencies to understand the relationship between the cash flows of our all of
our floor plan notes payable and our inventory in order to (i) understand our working capital and operating cash flow and (ii) compare our operating cash flow to that of our competitors (i.e., if our competitors have a different mix of
manufacturer affiliated and non-manufacturer affiliated floor plan as compared to us). We believe that by splitting the cash flows of floor plan notes payable associated with the purchase of inventory between operating activities and financing
activities while all inventory activity is included in operating activities results in significantly different operating cash flow than when all the cash flows of floor plan notes payable associated with the purchase of inventory are classified in
operating activities.

 Below we have included a table that compares cash provided by (used in) operating activities to cash provided by
(used in) operating activities, as adjusted. The purpose of this table is to illustrate the impact on operating cash flow of splitting the cash flows of floor plan notes payable associated with the purchase of inventory between operating and
financing activities. We believe that cash flow from

 Mr. H. Christopher Owings, Assistant Director

 The
Division of Corporation Finance

 U.S. Securities & Exchange Commission

 January 22, 2008

 Page
 5

operating activities could be misinterpreted by investors and analysts as indicating that our operating cash flow was significantly higher in 2006 and
significantly lower in 2005 and 2004, as a result of changes between manufacturer affiliated floor plan notes payable and non-manufacturer affiliated floor plan notes payable related to (i) changes in the franchise mix of our vehicle inventory
and (ii) changes in floor plan providers, neither of which we believe are related to changes in the operating cash flow of our business.

2006

2005

2004

 Cash provided by (used in) operating activities

$
128.6M
(a)

$
(40.5
)M(b)

$
(17.9
)M(c)

 Cash provided by operating activities, as adjusted

$
86.3M

$
72.1M

$
0.1M
(c)

(a)
Includes $85.4 million of manufacturer affiliated floor plan borrowings associated with changing the floor plan provider for inventory purchases at our Mercedes-Benz, Chrysler,
Dodge and Jeep stores from the non-manufacturer affiliated committed credit facility to the manufacturer affiliated DaimlerChrysler Financial Services.

(b)
Includes $93.4 million of manufacturer affiliated floor plan repayments associated with changing the floor plan provider for inventory purchases at our Mercedes-Benz, Chrysler,
Dodge and Jeep stores from the manufacturer affiliated DaimlerChrysler Financial Services to the non-manufacturer affiliated committed credit facility.

(c)
During the second half of 2004, we repaid a significant amount of floor plan notes payable prior to the sale of the related vehicles. We estimate that absent this significant
repayment of floor plan notes payable our cash flow from operating activities would have increased by approximately $68.0 million as stated on page 46 of our 2004 Form 10-K.

 Based on the above, we respectfully believe that presenting cash flow provided by operating activities, as adjusted, is appropriate and is not prohibited
by Item 10(e)(1)(ii)(A) of Regulation S-K.

4.
Please tell us how the information disclosed in the third paragraph under the investing activities sub-heading regarding the purchase and sale of real estate in Texas corresponds
to the disclosure related to the amount of cash used to purchase previously leased real estate in the statement of cash flows on page 75.

 Prior to December 2005, we had a master lease agreement on fourteen properties in Texas. We had dealership operations on ten properties, we subleased three properties to third-party dealership operators, and one
property was vacant. The master lease agreement contained a purchase option, which could only be exercised in total (i.e., we had to acquire all the properties subject to the lease agreement).

 In December 2005, we exercised the purchase option included in the master lease for all of the Texas properties. The $57.0 million purchase price of
previously

 Mr. H. Christopher Owings, Assistant Director

 The
Division of Corporation Finance

 U.S. Securities & Exchange Commission

 January 22, 2008

 Page
 6

leased real estate, disclosed on page 60, includes $44.7 million paid for the ten properties on which we had dealership operations, and $12.3 million paid
for the three subleased properties and the vacant property. The $12.3 million is included in “Capital expenditures-externally financed” within investing activities in the statement of cash flows. Immediately following the $44.7 million
purchase of previously leased real estate, we sold the same real estate to an independent third-party for $44.7 million and entered into operating leases with the buyer for the properties that contained our dealership operations. The $44.7 million
of proceeds from the sale of the real estate is included in “Proceeds from the sale of assets” included in the investing section of our statement of cash flows.

 We separately disclosed the $44.7 million purchase of previously leased real estate in our statement of cash flows to differentiate this purchase of real estate from capital expenditures since the real estate was
immediately sold and we did not have an intention to retain ownership of the real estate. We believe that separate disclosure of this cash flow item within the investing activities section of our cash flow statement is the most transparent and
meaningful presentation of this sale-leaseback transaction. In addition, we believe that separately disclosing this real estate purchase prevents our investors, analysts and rating agencies from understanding that our recurring capital expenditure
requirements were $44.7 million higher than our actual capital expenditure requirements.

 Application of Critical Accounting Estimates, page 62

5.
Please disclose the amount of inventory losses, note receivable credit losses, F&I chargebacks and goodwill and intangible asset impairment losses for each year presented
and, if material, the effect of any changes in assumptions on your operating results. Please also disclose your insurance reserves at each balance sheet date and provide an analysis of the sensitivity of your insurance reserve and impairment
estimates to change. Refer to the Commission’s Guidance Regarding Management’s Discussion and Analysis of Financial Condition and Results of Operations, Release No. 33-8350 available on our website at
www.sec.gov/rules/interp/33-8350.htm.

 Below are our new and used inventory losses, notes receivable credit losses
and F&I chargebacks for the years ended December 31, 2006, 2005 and 2004, and our insurance reserves as of December 31, 2006 and 2005. We have not recorded any goodwill impairment charges for any period presented. Intangible
write-downs have only incurred in connection with the sale of certain dealerships.

 Mr. H. Christopher Owings, Assistant Director

 The
Division of Corporation Finance

 U.S. Securities & Exchange Commission

 January 22, 2008

 Page
 7

2006

2005

2004

 New inventory losses

$
1.3M

$
1.0M

$
0.5M

 Used inventory losses

$
13.6M

$
12.5M

$
13.4M

 Notes receivable credit losses

$
2.9M

$
2.7M

$
2.6M

 F&I chargebacks

$
20.8M

$
17.1M

$
14.6M

 Insurance reserves

$
5.6M

$
4.6M

 Upon reviewing the Staff’s comments related to the application of critical accounting
estimates, we have determined that estimates for new inventory losses and notes receivable credit losses are not critical as they are not material. As a result, we will remove them f