Auto Giant Files for Bankruptcy, Blames Tariffs

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The Wall Street Journal is calling it the first

big casualty of the tariff war.

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Morelli, the auto parts giant and supplier to

big names like Stalantti and Nissan,

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Has filed for bankruptcy protection.

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Known for its electronics, powertrain, and

lighting-related products for the automotive

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industry, Morelli has reportedly been

struggling with heavy debt and supply chain

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challenges over the past few years.

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But when revealing its filing, the company

leaders identified something else.

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Morelli CEO David Slomp cited macroeconomic

headwinds associated with tariffs as the

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tipping point.

That caused the company's situation to worsen.

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Slump said pandemic era supply chain issues

restricted the company's access to both labor

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and parts, including semiconductors.

The company,

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which invested heavily in the EV transition,

was struggling with liquidity when fresh woes

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hit in 2025.

Slump said Morelli was severely affected by

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tariffs due to its import export focused

business and the position of tariffs

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specifically against automotive manufacturers

and suppliers.

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Morelli was formed in 2019 when a private

equity firm merged 100 year old Japanese parts

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business Magnetti Morelli with a Fiat Chrysler

auto parts business.

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The resulting tie-up has 40,000 employees and

150 plus locations in 23 countries,

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including the US.

Morelli says it plans to continue.

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After establishing a deal with its lenders and

creditors that will bring in more than $1

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billion to finance the company's restructuring.

Meanwhile, the situation has led some observers

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to question whether Morelli is the canary in

the coal mine.

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Bloomberg, citing the analyst firm Alex

Partners, recently suggested that the

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automotive industry is the global sector most

vulnerable to financial distress this year.

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I'm Anna Wells, this is manufacturing now.