SEC Filings


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

We anticipate our customer base for Electrified Power offerings will be highly diversified, with customer groups varying by their power and range needs. We have secured a partnership with Gillig for our urban bus electrified powertrain in North America. Outside of North America, our largest anticipated geographic markets are Europe and China.

In the markets served by our Electrified Power segment, we compete with electric start-ups, vehicle manufacturers and vertically integrated OEMs. Our primary competitors include Proterra, Inc., Motiv Power Systems, Inc., Daimler, PACCAR, Volvo, Navistar, TRATON AG, BYD Company Limited, BAE Systems plc and Siemens AG.
JOINT VENTURES, ALLIANCES AND NON-WHOLLY-OWNED SUBSIDIARIES
We have entered into a number of joint venture agreements and alliances with business partners around the world. Our joint ventures are either distribution or manufacturing entities. We also own controlling interests in non-wholly-owned manufacturing and distribution subsidiaries.
In the event of a change of control of either party to certain of these joint ventures and other strategic alliances, certain consequences may result including automatic termination and liquidation of the venture, exercise of "put" or "call" rights of ownership by the non-acquired partner, termination or transfer of technology license rights to the non-acquired partner and increases in component transfer prices to the acquired partner. We will continue to evaluate joint venture and partnership opportunities in order to penetrate new markets, develop new products and generate manufacturing and operational efficiencies.
Financial information about our investments in joint ventures and alliances is incorporated by reference from Note 3, "INVESTMENTS IN EQUITY INVESTEES," to the Consolidated Financial Statements.
Our equity income from these investees was as follows:
 
Years ended December 31,
In millions
2018
 
2017
 
2016
Manufacturing entities
 
 
 
 
 
 
 
 
 
 
 
Beijing Foton Cummins Engine Co., Ltd.
$
72

 
21
%
 
$
94

 
30
 %
 
$
52

 
20
%
Dongfeng Cummins Engine Company, Ltd.
58

 
17
%
 
73

 
24
 %
 
46

 
18
%
Chongqing Cummins Engine Company, Ltd.
51

 
15
%
 
41

 
13
 %
 
38

 
15
%
Cummins Westport, Inc.
28

 
8
%
 
9

(1) 
3
 %
 
11

 
4
%
Dongfeng Cummins Emission Solutions Co., Ltd.
14

 
4
%
 
13

 
4
 %
 
9

 
3
%
Tata Cummins, Ltd.
14

 
4
%
 
(7
)
(1) 
(2
)%
 
6

 
2
%
All other manufacturers
73

 
23
%
 
56

(1) 
18
 %
 
43

 
17
%
Distribution entities


 


 


 


 


 


Komatsu Cummins Chile, Ltda.
26

 
8
%
 
30

 
10
 %
 
34

 
13
%
North American distributors

 
%
 

 
 %
 
21

(2) 
8
%
All other distributors

 
%
 
(1
)
 
 %
 

 
%
Cummins share of net income(3)
$
336

 
100
%
 
$
308

 
100
 %
 
$
260

 
100
%
___________________________________________________________
(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 interests in the final unconsolidated North American Distributor joint venture.
(3) This total represents our share of net income of our equity investees and is exclusive of royalties and interest income from our equity investees. To see how this amount reconciles to "Equity, royalty and interest income from investees" in the Consolidated Statements of Income, see Note 3, "INVESTMENTS IN EQUITY INVESTEES," to our Consolidated Financial Statements for additional information.


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