Racecar maker with Baja 500 wins files Chapter 7 bankruptcy

The auto industry has faced economic distress in the last year that led to bankruptcy filings and business closings.

Most troubled businesses cite many of the same issues that are causing problems, such as rising labor and product costs driven by inflation, higher tariffs, increased interest rates, and consumers’ changing attitudes toward spending in uncertain times.

New car sales have been slowing at the beginning of the year and may continue further into 2026, according to an industry expert.

New car sales slow down

“Sales slowed in the fourth quarter of last year, and that trend is expected to continue into the start of 2026,” Cox Automotive senior economist Charlie Chesbrough said in the company’s 2026 forecast in late January.

“The market is slowing due to ongoing concerns about the U.S. economy and persistently high new-vehicle prices,” Chesbrough said. “These market conditions are expected to be major headwinds for the new market throughout 2026.”

And now, the auto industry starts the year with a bankruptcy filing, which will result in the demise of the company, unless someone buys the company to revive it.

Alumicraft files for Chapter 7 bankruptcy liquidation, facing lawsuit claims.

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Alumicraft files Chapter 7 bankruptcy

California-based off-road racecar manufacturer Alumicraft LLC filed for Chapter 7 bankruptcy liquidation, facing millions in liabilities, including a claim of over $15 million in a wrongful death lawsuit, and a couple of insurance cases involving State Farm Insurance, Edthat reported.

Alumicraft manufactured two off-road truck models, Unlimited and Spec; three off-road buggies, Class 1 AWD, Class 1, and Class 10; and three dune buggies, A2, S2, and S4.

The Santee, Calif.-based automobile maker filed its petition in the U.S. Bankruptcy Court for the Southern District of California on March 3, listing about $16.7 million in liabilities and about $22,700 in assets.

The debtor will not have funds available to pay unsecured creditors after administrative expenses are paid, according to the petition.

The lion’s share of liabilities consists of claims totaling $15.76 million, including a $15.23 million judgment claim from the estate of Brian Kuhnhenn and a claim of over $401,000 in lease payments by Split Mountain Industrial Properties.

Alumicraft listed a secured claim of over $954,000 from Matthew Fleming, consisting of a lien on equipment, receivables, materials, deposits, and bank accounts.

Alumicraft revenue declined annually

The debtor’s revenue had declined significantly over the last three years, falling from $3.63 million in 2023 to $2.98 million in 2024, then plummeting to about $370,833 in 2025.

The debtor said it does not own or possess any real estate or personal property, Edthat reported.

Alumicraft racecars won several major off-road races in 2022, including driver Michael Meister winning the Crandon Off-Road Super Buggy Championship in Crandon, Wis., in September with the most points in the season, with fellow Alumicraft racer Mark Steinhardt placing second, according to the company’s website.

Alumicraft vehicles dominate off-road

Racers driving Alumicraft cars also won Class 1 and Class 10 divisions at the SCORE Baja 500 in June 2022. Of the 17 cars finishing the Class 10 race, 11 drove Alumicraft cars.

Other niche vehicle manufacturers, such as electric vehicle companies, have also faced severe economic issues over the last two years.

Nikola Corp., a pioneer in the development of battery electric and hydrogen fuel cell electric semi-trucks, filed for Chapter 11 bankruptcy on Feb. 19, 2025, seeking a sale of its assets.

Another EV company, commercial electric truck manufacturer Bollinger Motors, shut down operations on Nov. 21, 2025, six months after emerging from receivership, but did not file for bankruptcy protection.

The Brea, Calif., company, which was founded in 2015, released its B1 SUV prototype for consumers in 2017 before later launching its commercial electric truck manufacturing in Oak Park, Mich., with its Bollinger B4 in September 2024.

Subsectors of the auto industry, such as auto parts companies, have struggled, as well, and filed for bankruptcy protection.

Auto parts companies file bankruptcy

Global giant auto parts company Marelli Holdings Co. filed for Chapter 11 bankruptcy on June 11, 2025, listing $4.9 billion in funded debt, with plans to hand the company over to its senior lenders.

The debtor blamed its distress on the effects of the Covid pandemic and post-pandemic market challenges and headwinds, including supply chain challenges, labor shortages, high costs, inflation, rising prices of raw materials, and declining customer volumes. It also blamed tariffs.

Huge auto parts company First Brands Group filed for Chapter 11 bankruptcy on Sept. 25, 2025, with about $6 billion in debt.

First Brands makes auto parts products, such as Michelin licensed wiper blades, Raybestos complete brake solutions, Fram filtration products, Autolite spark plugs, and Anco wiper blades.

Alumicraft models:Trucks: Unlimited and SpecOff-road buggies: Class 1 AWD, Class 1, and Class 10Dune buggies: A2, S2, and S4.

Related: Popular furniture chain files Chapter 11 bankruptcy, shuts stores

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