Overview

• Auto-parts maker First Brands filed for bankruptcy on Monday after a failed debt refinancing and deeper investor scrutiny, with one source saying tariffs worsened its position.
• The filing follows the recent bankruptcy of subprime lender Tricolor Holdings, which focused on low-income Hispanic buyers in the U.S. Southwest.
• Spreads on the ICE BofA AA-BBB US Fixed Rate Automobile ABS Index have widened by more than 20 basis points this month, signaling heightened risk perceptions in auto credit.
• By contrast, broader U.S. corporate bond markets have stayed steady, with investment-grade and high-yield spreads tightening following the Federal Reserve’s rate cut.
• VantageScore reports auto-loan delinquencies at historic highs, with lower-income households showing higher rates as analysts flag affordability pressures from high borrowing costs, used-car prices, insurance and maintenance.