Cummins sees stronger truck sales, completes Meritor acquisition

August 4, 2022

Chuck Robinson

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Engine sales for North American trucks are on track for significant gains this year, Cummins’ new president noted in the company’s second-quarter earnings report.

Jennifer Rumsey was promoted to president and CEO of Columbus, Ind.-based Cummins Inc. in mid-July. She succeeded Thomas Linebarger, who became chairman of the board of directors. Rumsey had been Cummins chief operating officer since March 2021 and before that she oversaw Cummins’ global operations. This was her first investor earnings call as president and CEO.

“We are maintaining our forecast for heavy-duty trucks in North America to be 250,000 units to 260,000 units in 2022, a 10% to 15% increase over a year ago,” Rumsey said during the earnings call. A transcript of the call is available. “The supply chain constraints our industry is experiencing continue to limit our collective ability to fully meet strong end-customer demand. In North America medium-duty truck market, we are continuing to project the market size to be 120,000 to 130,000 units, a 5% to 10% increase from 2021.”

Despite international challenges, she said Cummins is still on track for 8% increased revenue for the year compared to last.

“This guidance reflects stronger performance in North America and a weaker market outlook in China as well as the indefinite suspension of our operations in Russia,” she said.

During the first quarter, Cummins suspended operations in Russia and recorded a charge of $158 million.

In China, Cummins projects total revenue to be down 20% to 25%, double previous estimates. Heavy- and medium-duty truck demand in China is down 50%. The light-duty truck market and sales of excavators were also significantly down and more than previously estimated. Revenue from joint ventures in China is expected to increase.

Rumsey highlighted some major events for Cummins in the second quarter.

In April, Cummins completed its acquisition of Jacobs Vehicle Systems. That acquisition brought Cummins engine braking, cylinder deactivation, start-stop control and thermal management technologies, which she said are key components to meeting current and future emissions regulations.

On May 26, shareholders of Meritor Inc. voted in favor of the Cummins acquisition bid, Rumsey reported. Meritor specializes in axle and brake technology. The acquisition was reported complete in an Aug. 3 news release.

Also during the second quarter, Cummins announced several collaborations with these partners:

  • Daimler Truck North America and Scania to deliver fuel cell electric powertrains for heavy-duty truck applications.
  • Komatsu on development of zero-emission hauling equipment, including hydrogen fuel cell solutions for large mining trucks used for hauling.
  • Chevron and Walmart to integrate Cummins X15N natural gas engines, powered by renewable natural gas, into Walmart’s heavy-duty truck fleet.

“These customer collaborations are significant steps in alignment with our Destination Zero strategy to evolve our company, our products and our customers’ products to the technologies needed for a decarbonized world,” Rumsey said. “This strategy, which represents a significant growth opportunity for Cummins, includes reducing carbon emissions now by making improvements in engine-based solutions that are broadly available today while rapidly advancing the zero emissions technologies of the future.” LL

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Chuck Robinson formerly was senior copy editor for a weekly trade publication serving the fresh produce industry. He has served trade publications, horticultural journals and community newspapers for 25 years.