Major Auto Parts Supplier Files For Bankruptcy

MICHIGAN — A major international auto parts supplier has filed for bankruptcy and announced intentions to restructure, according to the company.

Marelli, a Japanese company that is a key supplier for Nissan and Jeep owner Stellantis, has a North American headquarters in Michigan and employs more than 40,000 people around the world. It launched in 2019 after private equity firm KKR bought an auto-parts business and merged it with a Japanese-based parts supplier.

"Taking this action now provides access to new liquidity to fund our long-term growth and innovation pipeline, and ensures our customers and partners all over the world can continue to rely on Marelli for on-time delivery of advanced technologies that shape the vehicles of the future," said President and CEO David Slump.

The Chapter 11 protection filing was announced by the interior and lighting maker on Wednesday, June 11. It said it had secured a commitment of $1.1 billion in financing from lenders and that around 80 percent of the lenders signed an agreement in support of the company's restructuring.

"As we move through this process, we will continue to serve our customers and work with our suppliers and partners as they have come to expect," Slump said.

In the company's filing, Marelli said the global trade war and President Donald Trump's tariffs have imposed hardship on its import and export-focused business, according to the Wall Street Journal.

In a court filing Wednesday, Slump said the company had been grappling with lingering supply-chain challenges stemming from the COVID-19 pandemic, but its financial position began to deteriorate further this spring due to "macroeconomic headwinds associated with the imposition of tariffs in countries around the world."

Slump also noted that “Marelli was severely affected by tariffs due to its import/export-focused business and the imposition of tariffs specifically against automotive manufacturers and suppliers.”

The Trump administration had introduced broad tariffs on imported cars and certain auto parts in March, significantly impacting manufacturers dependent on overseas production.

In declaring the tariffs, President Donald Trump had invoked emergency powers under a 1977 law. But a three-judge panel of the U.S. Court of International Trade ruled he had exceeded his power.

The tariffs have upended global trade, paralyzed businesses and spooked financial markets.

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