The company behind some of the greatest cars and craziest videos the Internet has ever seen, Hoonigan, has filed for bankruptcy. Is this the end of an era, or a new beginning for one of the modified car scene’s greatest stars?
Today is a sobering day in the world of high-octane car culture. Why? Because today is the day we learned that Hoonigan has filed for Chapter 11 bankruptcy protection, aiming to discharge a whopping $1.2 billion in debt while restructuring its operations. Known for its crazy, adrenaline-pumping content and jaw-dropping builds, Hoonigan became a household name for car fans all across the world with stars like Ken Block and Travis Pastrana doing crazy things in crazy cars. But the challenges post-pandemic have thrown quite the spanner into the works.
What Went Wrong?
During the pandemic, demand for automotive customisation and modifications surged. People stuck at home turned to thier cars. Home garages became tuning workshops, igniting a golden era for companies like Hoonigan. But, as the world re-emerged, so did the economic toll of supply chain constraints and soaring costs.
Revenue jumped from $844 million in 2019 to an eye-watering $1.5 billion in 2022. But then took a nosedive in 2023. Hoonigan faced high interest rates and skyrocketing costs for materials like aluminum, coupled with a sudden slump in demand. The company missed its projected earnings targets, and it was clear something drastic had to be done. Enter Chapter 11.
The Merger and the Downfall
As part of a rebrand, Hoonigan became the face of Wheel Pros, LLC, back in October 2023. Remember Wheel Pros? They’ve been a stalwart in the aftermarket world since 1994, designing and selling wheels, tyres, and accessories. Clearlake Capital acquired Wheel Pros in 2018, leading to a flurry of acquisitions and expansions. When Hoonigan merged with Wheel Pros in September 2021, everything looked golden. The company was experiencing tremendous growth.
Before merging with Hoonigan, Wheel Pros was in full throttle with its expansion plans, snapping up two facilities in the United States back in 2018 and 2020. The cost? A cool $12 million, plus some extra cash for additional investments. But the investments didn’t pan out as expected. By late 2021, they had to let go of a big chunk of one facility and shut down the other entirely in early 2023.
What’s Next for Hoonigan?
Hoonigan’s Chapter 11 filing in Delaware isn’t just about cutting losses. It’s about restructuring for a more sustainable future. They’ve already entered a Restructuring Support Agreement (RSA) with many of their debtholders and are in the process of securing approximately $570 million in new capital. The goal? To emerge from the proceedings in just two months, backed by the majority ownership of a group of current lenders.
The good news for employees, customers, vendors, and suppliers is that Hoonigan plans to continue normal business operations without any disruptions. The court will have the final say, but this restructuring could pave the way for a leaner, more resilient company.
A Community in Transition
For a brand that’s defined car culture and pushed the boundaries of what’s possible behind the wheel, this bankruptcy isn’t the end—it’s just another chapter. The community of automotive enthusiasts remains strong and hopeful. Maybe it’s the adversity that fuels our love for cars even more. Hoonigan, after all, is more than just a company; it’s a symbol of our undying passion for high-performance vehicles and the thrill of the road.
We wish Hoonigan all the best with the restructure, and look forward to seeing what cool content and products the iconic Hoonigan brand can give car enthusiasts in the future.
The post Hoonigan has filed for Bankruptcy appeared first on Fast Car.
