SEC Filings


10-K
CUMMINS INC filed this Form 10-K on 02/11/2019
Entire Document
 

Equity, royalty and interest income from investees, net of applicable taxes, was as follows:
 
 
Years ended December 31,
 
In millions
 
2018
 
2017
 
2016
 
Manufacturing entities
 
 
 
 
 
 
 
Beijing Foton Cummins Engine Co., Ltd.
 
$
72

 
$
94

 
$
52

 
Dongfeng Cummins Engine Company, Ltd.
 
58

 
73

 
46

 
Chongqing Cummins Engine Company, Ltd.
 
51

 
41

 
38

 
Cummins Westport, Inc.
 
28

 
9

(1) 
11

 
Dongfeng Cummins Emission Solutions Co., Ltd.
 
14

 
13

 
9

 
Tata Cummins, Ltd.
 
14

 
(7
)
(1) 
6

 
All other manufacturers
 
73

 
56

(1) 
43

 
Distribution entities
 
 
 
 
 
 
 
Komatsu Cummins Chile, Ltda.
 
26

 
30

 
34

 
North American distributors
 

 

 
21

(2) 
All other distributors
 

 
(1
)
 

 
Cummins share of net income
 
336

 
308

 
260

 
Royalty and interest income
 
58

 
49

 
41

 
Equity, royalty and interest income from investees
 
$
394

 
$
357

 
$
301

 

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(1) U.S. tax legislation passed in December 2017 decreased our equity earnings at certain equity investees, including a $7 million unfavorable impact to Cummins Westport, Inc. due to the remeasurement of deferred taxes and $15 million unfavorable impact to Tata Cummins, Ltd. and a $17 million unfavorable impact to "All other manufacturers" due to withholding tax adjustments on foreign earnings. See Note 4, "INCOME TAXES," to our Consolidated Financial Statements for additional information.
(2) During 2016, we acquired the remaining interest in the final unconsolidated North American distributor joint venture.
Manufacturing Entities
Our manufacturing joint ventures have generally been formed with customers and are primarily intended to allow us to increase our market penetration in geographic regions, reduce capital spending, streamline our supply chain management and develop technologies. Our largest manufacturing joint ventures are based in China and are included in the list below. Our engine manufacturing joint ventures are supplied by our Components segment in the same manner as it supplies our wholly-owned Engine segment and Power Systems segment manufacturing facilities. Our Components segment joint ventures and wholly owned entities provide electronics, fuel systems, filtration, aftertreatment systems, turbocharger products and transmissions that are used with our engines as well as some competitors' products. The results and investments in our joint ventures in which we have 50 percent or less ownership interest (except for Eaton Cummins Automated Transmission Technologies joint venture) are included in “Equity, royalty and interest income from investees” and “Investments and advances related to equity method investees” in our Consolidated Statements of Income and Consolidated Balance Sheets, respectively.
Beijing Foton Cummins Engine Co., Ltd. - Beijing Foton Cummins Engine Co., Ltd. is a joint venture in China with Beiqi Foton Motor Co., Ltd., a commercial vehicle manufacturer, which consists of two distinct lines of business, a light-duty business and a heavy-duty business. The light-duty business produces our families of ISF 2.8 liter to 4.5 liter high performance light-duty diesel engines in Beijing. These engines are used in light-duty and medium duty commercial trucks, pick-up trucks, buses, multipurpose and sport utility vehicles with main markets in China, Brazil and Russia. Certain types of small construction equipment and industrial applications are also served by these engine families. The heavy-duty business produces the X11 and X12 high performance heavy-duty diesel engines in Beijing. These engines are used in heavy-duty commercial trucks in China and will be used by Cummins either directly sourced from China and/or locally assembled in other markets. Certain types of construction equipment and industrial applications are also served by these engine families.
Dongfeng Cummins Engine Company, Ltd. - Dongfeng Cummins Engine Company, Ltd. (DCEC) is a joint venture in China with Dongfeng Automotive Co. Ltd., a subsidiary of Dongfeng Motor Corporation, one of the largest medium-duty and heavy-duty truck manufacturers in China. DCEC produces Cummins 3.9 to 13-liter diesel engines, with a power range from 80 to 680 horsepower, and natural gas engines.
Chongqing Cummins Engine Company, Ltd. - Chongqing Cummins Engine Company, Ltd. is a joint venture in China with Chongqing Machinery and Electric Co. Ltd. This joint venture manufactures several models of our heavy-duty and high-horsepower diesel engines, primarily serving the industrial and stationary power markets in China.

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