Hoonigan, one of the biggest automotive brands to emerge in the 2010s, has filed for chapter 11 bankruptcy in Delaware.
In the filing, it’s revealed that the company is $1.2 billion in debt. Through the restructuring, the company hopes to come out of chapter 11 and secure $570 million in new funding. Vance Johnston, CEO of Hoonigan, called the bankruptcy an important step for the company. From Yahoo Finance:
With a significantly strengthened balance sheet and new capital, this transaction will position us to invest in innovation and further drive financial performance. With the strong support of our financial partners, we remain laser-focused on providing cutting-edge products and best-in-class service to our partners throughout this process.
One has to wonder just how the hell an automotive lifestyle brand founded by the late Ken Block wound up over a billion dollars in debt just over a decade after it was founded. It seems as if an aggressive expansion plan may be to blame. The company we know as Hoonigan merged with aftermarket wheel company Wheel Pros and rebranded to Hoonigan in late 2023. Both are backed by private equity firm Clearlake Capital Group. In 2022, as part of building out its automotive enthusiasts brands, Hoonigan acquired Transamerican Auto Parts. The California-based off-road performance company was purchased for $50 million.
Hoonigan’s bankruptcy also comes amid a decline in automotive media in general, but automotive YouTube in particular, a big contributor to the companies bottom line. Hoonigan’s YouTube channel has over 5 million subscribers but it lost many of it’s biggest content creators. People like Zac Martens (Mister Zachery) and Van Anatra all left to create their own automotive social media pages. Donut Media and CarThrottle have seen similar exits by content creators.
With the company’s future now in the hands of the courts after the bankruptcy was approved by both Clearlake and its creditors, hopefully this isn’t the last we see of Hoonigan.