Cummins Eyes Changes After Sales Drop
In the wake of a sharp drop in sales and profits, Cummins Chairman Tim Solso said the company is considering a major restructuring of its medium- and heavy-duty truck engine business.
Diesel engine sales account for nearly two-thirds of Cummins’ revenue, but a downturn in the heavy-truck market trimmed sales by 31% to $315 million in the latest quarter. Unit shipments in North America are down 49% compared to the same period in 1999.
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“We’ve taken a long hard look at that [truck] market. It requires fundamental change,” Solso said during a conference call with investment analysts following the release of third quarter financial results on Oct. 12.
Cummins earned $25 million in the three months ended Sept. 30, down from $53 million a year earlier. Revenue dropped to $1.57 billion from $1.63 billion.
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