Auto Stocks in a Spin as First Brands, Tricolor Worry Investors

US auto stocks took a major hit this week as cracks emerged in the sector following the high-profile implosions of parts supplier First Brands and subprime lender Tricolor Holdings, while renewed tariff tensions raised fresh concerns for investors.

An index tracking the companies that supply parts to carmakers dropped about 8.5% since last Friday’s close, notching the worst decline since US President Donald Trump launched his tariff offensive in April. For companies that largely serve the lower end of the US consumer, such as aftermarket parts retailers and used-car dealers, this week’s plunge marks the worst weekly loss since ...