Hoonigan Files for Chapter 11 Bankruptcy

Hoonigan, the automotive entertainment and aftermarket parts company, has filed for Chapter 11 bankruptcy in Delaware, aiming to eliminate approximately $1.2 billion of its total $1.75 billion debt. The company, owned by Clearlake Capital and known for its Gymkhana videos, plans to secure up to $570 million in new capital through a Restructuring Support Agreement with its creditors. The financial struggles arose post-pandemic due to aggressive expansion, rising operational costs, and a decline in automotive media, particularly on platforms like YouTube. Hoonigan's CEO, Vance Johnston, expressed optimism that the restructuring will position the company for future growth and innovation. The bankruptcy also highlights the challenges faced by the automotive sector as it adjusts to a post-pandemic landscape, with demand waning and costs rising. This marks a significant turn for a brand that once thrived under the late Ken Block's leadership and has now experienced a dramatic decline in its fortunes.