Only avid motorsport fans may be aware of the name “Hoonigan”. Originally founded in 20101, the brand is synonymous for organising insane stunts and enthralling motoring enthusiasts with their videos on YouTube. Created by Ken Block and Brian Scotto, Hoonigan became famous for selling products related to motorsport but later gained immense popularity for its digital content.
However, Hoonigan today faces severe challenges that threaten the company’s existence. The brand has declared bankruptcy with a debt of USD 1.2 billion (equivalent to Rs 104663 crore). But how did one of the largest automotive YouTube channels with millions of fans around the world struggling to make ends meet?
Hoonigan in trouble: Why?
Hoonigan had everything going right for itself becoming a sponsor of Mr. Block’s rally races. However, things took a downward spiral in 2021 when in an attempt to jump on the bandwagon of popularity, the company signed an agreement with Wheel Pros (another company that also owned wheels for cars), owned by Clearlake Capital, with which it ended up merging.
At first, everything seemed to be working perfectly but things did not go as expected. The entire global content industry was reeling under the effects of the Covid-19 pandemic. Despite this, product sales during the pandemic were more than decent but, with the arrival of the economic crisis of 2022 and the increase in Wheel Pros production costs, sales began to fall and dragged Hoonigan into the same problem.
The following year Wheel Pros decided to take the name Hoonigan to take advantage of the brand’s popularity, but the nosedive had already begun. However, things got even worse when Ken Block died tragically in a snowmobile accident the same year. With Hoonigan losing its brand face, popularity of the YouTube channel declined dramatically and the company lost the direction it had taken in recent years.
What’s now for Hoonigan?
Hoonigan has unveiled a restructuring plan aimed at reducing its $1.2 billion debt while seeking new investments to remain operational. CEO Johnston stated that the company is focused on strengthening its leadership position and, with fresh capital, hopes to improve its financial performance. Following this announcement, Hoonigan co-founder Brian Scotto shared a story on his social media, hinting at a potential return to YouTube in an effort to revive the brand’s original essence.
