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By Anirban Sen and Prakhar Srivastava (Reuters) -The U.S. Department of Justice has launched an inquiry into the collapse of bankrupt auto parts maker First Brands Group, a person familiar with the matter told Reuters on Thursday. The Justice Department is probing the company and its dealings with creditors, and has sent an inquiry to First Brands, the person said. The probe is at an early stage, the source said, adding that it is common for U.S. prosecutors to look into companies that publicly disclose losses that affect a large group of investors. No evidence of wrongdoing has been established so far, the source added. There is no guarantee that the inquiry will result in a full-blown investigation that will lead to charges being filed against the company. The Financial Times was first to report earlier on Thursday that the DOJ was probing First Brands. First Brands, which makes filters, brakes and lighting systems for the automotive industry, filed for bankruptcy protection last month after its lenders began investigating irregularities in the company's financial reporting. The company has $11.6 billion in total liabilities, according to court documents. The auto parts maker has separately appointed a special committee of independent board directors to investigate its off-balance sheet financing arrangements and whether its invoices were factored in multiple times. The DOJ did not immediately respond to a request for comment, while First Brands declined to comment. Financial troubles at First Brands and the recent bankruptcy of subprime lender Tricolor Holdings, have rattled debt investors and stoked fears of broader stress in corporate debt markets, according to bondholders and bankruptcy experts. Some of the financial firms exposed to First Brands include Jefferies, which disclosed $715 million in exposure through Leucadia Asset Management, and UBS, which is assessing exposure on more than $500 million tied to the company. (Reporting by Prakhar Srivastava in Bengaluru and Anirban Sen in New York; Editing by Shailesh Kuber)

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By Savyata Mishra (Reuters) -Levi Strauss raised its full-year profit forecast on Thursday, but the projection fell short of Wall Street expectations, sending shares of the denim-maker down about 6% in extended trading. The company now expects fiscal-year 2025 adjusted profit per share in the range of $1.27 to $1.32, up from its prior forecast of between $1.25 and $1.30 per share. The mid-point was below an estimate of $1.31, according to data compiled by LSEG. The forecast assumes U.S. tariffs will remain at 30% for China and 20% for other countries through the year-end. Tariffs impacted the company's gross margins by 80 basis points in the reported quarter, CFO Harmit Singh told Reuters, adding that the impact would be 130 basis points in the fourth quarter, which includes the crucial holiday season. The company, which sources the bulk of its products from South Asia – including Bangladesh and Pakistan – has undertaken modest price hikes and secured inventory ahead of the key holiday season to limit disruptions from volatile trade policies.  Levi has leaned into full-price sales through its direct-to-consumer channel, broadened its product offerings and kept a tight leash on stock-keeping units, or SKUs, an industry term for inventory.  Robust international demand helped cushion some tariff pain, with quarterly revenues in Asia and Europe growing 12% and 5%, respectively. Globally, DTC sales witnessed 9% growth, while online sales jumped 16%. San Francisco, California-based Levi Strauss reported a 7% rise in net revenue for the quarter ended August 31 to $1.54 billion, beating analysts' estimate of $1.50 billion, according to data compiled by LSEG. Adjusted profit came in at 34 cents per share, from 33 cents per share in the same period last year. Operating margin improved to 10.8% from 2.3% a year earlier, driven by higher DTC as well as full-price sales. (Reporting by Savyata Mishra in Bengaluru; Editing by Pooja Desai)

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By Diego Oré and Emily Green MEXICO CITY (Reuters) -Mexico's Congress will hold off approving proposed tariff hikes on nearly 1,500 products from China and other Asian countries while Mexico holds talks with those countries and considers changes to the proposal, President Claudia Sheinbaum said on Thursday.   Sheinbaum sent the proposal – which seeks to increase tariffs by up to 50% on cars, textiles, clothing, plastics, steel, and other products – in early September to the lower house of Congress, where her Morena Party holds a large majority. Many analysts saw the move as an attempt to placate U.S. President Donald Trump.  But since then, China – Mexico’s second-biggest trading partner after the U.S. – has criticized the proposal, saying it would undermine investor confidence. China warned Mexico it would take "necessary measures" to safeguard its "legitimate rights and interests." PROPOSAL UNDER REVIEW On Thursday, Sheinbaum said her government was analyzing potential changes to the tariff hikes.   "We are holding these meetings with different countries to see if we can adapt what we are presenting to Congress for approval this year," she said during her daily press conference. Her comments came a day after Ricardo Monreal, leader of Morena in the Chamber of Deputies, told reporters that Congress would "pause" the proposal for now and pick it up again at the end of November. “We are reviewing the proposal very seriously,” he said. Morena legislators, who spoke on condition of anonymity, told Reuters the tariffs would not be approved by Congress in their current form and that the plan would likely have to be softened. It was unclear what changes there might be. Any adjustments could create holes in the government’s 2026 budget, as Mexico’s Finance Ministry projected the proposed tariffs would generate $3.76 billion.  The proposed tariffs would affect imports from countries Mexico does not have trade agreements with, including China, South Korea, India, Indonesia, Russia, Thailand, and Turkey. VEHICLE, AUTO PARTS TARIFFS COULD JUMP As currently drafted, tariffs on light vehicles would rise to 50% from 15%-20%, and on auto parts to 10%-50% from the current zero-35%.  Some analysts estimate the increased tariff on cars would primarily affect electric vehicles manufactured in China and sold in Mexico, hitting BYD and Tesla the hardest. The Sheinbaum administration argues the tariff increases are a means of protecting Mexico’s domestic production, although they also come amid pressure from the U.S. for Mexico to curtail business with China. One Morena politician who spoke on condition of anonymity said approval of the tariffs has been delayed amid concern that they could boost consumer prices and harm Mexican businesses.  The person said that long-term, they believe Mexico is moving toward a plan for the U.S., Canada, and Mexico to impose matching tariffs on China. (Reporting by Diego Oré and Emily Green; Additional reporting by Ana Isabel MartínezEditing by Rod Nickel)

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