Automobile parts and service centers have faced many of the same challenges that other retail sectors have dealt with in the last year, including rising costs of labor and products driven by inflation, increased interest rates on debt, and fierce competition in attracting business.
As interest rates and inflation began to rise following the Covid-19 pandemic, consumers began to shy away from buying cars, and many chose to instead spend a lot less money on repairing their vehicles.
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As more people sought to repair vehicles instead of buying new ones, the automotive aftermarket sector faced less of a financial impact in recent economic downturns, according to a 2022 report from KPMG.
Related: Major trucking company files Chapter 11 bankruptcy to restructure
Following the report, however, several auto parts suppliers with huge debt obligations suffered from rising interest rates and inflation. Some retailers, such as Advance Auto Parts, embarked on out-of-court restructuring measures.
Advance Auto Parts, which operated nearly 5,000 stores, in November 2024 revealed that it would launch a strategic turnaround and close 727 corporate-owned and independent locations and lay off a significant number of employees by mid-2025.
Before Advance Auto revealed its restructuring, several auto parts retailers filed for Chapter 11 bankruptcy, facing financial distress.
Auto parts retailers file for bankruptcy
Wheel Pros, which operates as auto parts distributor and retailer Hoonigan, filed for a prepackaged Chapter 11 bankruptcy on Sept. 9, 2024, to eliminate $1.2 billion in debt and provide about $570 million in new capital through an exit facility.
Accuride Corp., another leading manufacturer of wheels and wheel-end products for commercial trucks and trailers, a month later filed for Chapter 11 bankruptcy protection on Oct. 9, 2024, seeking a consensual restructuring of its debt to continue operating as a going concern.
Another auto parts supplier Northvolt AB, which makes electric vehicle batteries for several carmakers, including BMW, Audi, Porsche, Volvo, Polestar, and Swedish truckmaker Scania, filed for Chapter 11 bankruptcy protection on Nov. 21, 2024, seeking a going-concern recapitalization or sale of its assets as it faced an acute liquidity crisis.
The Stockholm-based debtor obtained a bankruptcy court order to dismiss its Chapter 11 case after it filed for bankruptcy liquidation in Sweden. Northvolt’s restructuring and reorganization plans had failed, and the company said there was little hope for the battery manufacturer to recover. It decided to follow through with liquidation in Sweden in March 2025.
AAMCO Transmissions & Total Car Care franchisee files for Chapter 11 bankruptcy.
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AAMCO Transmissions franchise files for bankruptcy
In addition to the auto parts industry, economic issues have affected the auto repair sector, as AAMCO Transmissions & Total Car Care franchisee in Cincinnati, Trinity Automotive Service Center LLC, filed for Chapter 11 bankruptcy on April 29, 2025, to reorganize its business.
Related: Another huge auto parts brand files for Chapter 11 bankruptcy
The debtor could not be reached for comment about its plans under bankruptcy, since it did not answer its business phone line, and its voicemail system was not operational.
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The franchisee’s bankruptcy attorney, Thomsen Law Group LLC, did not immediately respond to a request for comment.
The auto repair center, which specializes in transmission repairs and other automotive services, listed up to $50,000 in assets and $100,000 to $500,000 in liabilities in its Subchapter V petition filed in the U.S. Bankruptcy Court for the Southern District of Ohio.
The debtor’s largest creditors include North Mill Credit Trust, owed over $194,000; Rapid Finance, owed $44,000; and ProVenture Capital, owed $43,500. The petition also listed creditors with disputed claims, including the Internal Revenue Service and the Ohio Department of Taxation.
The parent company franchisor’s first shop opened in 1957 in North Philadelphia as the Anthony A. Martino Company, using the acronym AAMCO. The company launched a franchise operation in 1962 and opened its first franchise shop in Newark, N.J., in 1963.
AAMCO’s headquarters are currently located in Horsham, Pa.
Related: Another major health care company files for Chapter 11 bankruptcy
