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One Hundred Years of Development of Cummins Company

Mar 2, 2021 | Global Companies in China | 0 comments

In 1919, Cummins produced the first 6 HP, 4 cylinder Hvid engine for fixed power.  With the help of Knudson, a former Hvid engine engineer, Clessie began designing the engine herself.  He soon invented a single-disc fuel system that had never existed before.  He was well aware that developing a fuel engine would not only cost a lot of money but also have little chance of success. 

Sure enough, the company was soon in the red.  Cummins made some improvements to the engine, but it still had many flaws.  The farmers bought the machines home and returned them before the retailer promised them a refund.  Two months later, the great Recession in the United States led to a deep economic downturn, and Cummins’ main business, the Marine engine market, began to shrink.

But it was Clessie’s unique creativity that brought the company back from the brink of bankruptcy.  He attached a diesel engine to an old Packard limousine.  On Christmas Day 1929, he took Mr. Irwin for a spin in America’s first diesel car, trying to convince him to keep investing.  That gamble saved Cummins.

With the injection of new money from Mr Irwin, Clessie was determined to promote the new concept of diesel cars.  He and Duesenberg set the speed record for a diesel-engine car at Dayton Beach.  In 1931, Cummins set another endurance record by driving 13,535 miles in a row at the Indianapolis Motor Speedway. 

The fuel economy and durability of these prototypes have attracted some truck drivers and fleet managers, who have begun retrofitting Their vehicles with Cummins engines. 

Cummins introduced the H-type engine in 1933.  The engine was powerful enough to meet the needs of the transportation industry, and it became Cummins’ most successful engine line.  At the same time, Cummins hired good executives, including John Niven, an experienced manager; Paris Lightsinger, who created Cummins’ customer – and agency-oriented marketing system;  V.E. McMullan, who modernized the company’s operations;  Joseph Elvin Miller, great nephew of Mr. Elvin, has been managing Director of Cummins since 1934.  During the next 40 years, Mr. Alvin Miller led Cummins to become a well-known international company.  With high-quality products and a unique nationwide service system, Cummins made its first profit in 1937.  In 1940, Cummins introduced the first 100,000-mile warranty service in the engine industry. 

During World War II, Cummins Engine Company produced engines primarily for the U.S. Army and Navy.  Cummins’ engines had survived the rigors of war from the tropics to the Arctic Circle.  In Europe, Africa and other theatres, much of the Allied supplies were carried in convoys equipped with Cummins engines.  In the 1950s, the United States began a huge project to build interstate highways.  Cummins engines were used for most of the equipment used to build the roads, including the thousands of heavy trucks that would later drive them.  Truck drivers want engines that are fuel efficient, powerful, and safe, and Cummins engines are just what they need.  Combining laboratory research with practical applications — including valuable lessons learned at the Indy 500 — Cummins continues to make technological breakthroughs.  In 1954, Cummins invented the revolutionary PT (pressure-time) fuel injection system.  By the late 1950s, Cummins had annual sales of more than $100 million and was a leading manufacturer of diesel engines for heavy trucks. 

Expand Global Business, and Continuously Obtain Technological Advantages 

After its domestic success, Cummins set its sights on emerging international markets, with plans to build manufacturing plants outside the United States.  In 1956, Cummins established its first overseas factory in Shortts, Scotland.  In the early 1960s Cummins set up its own production sites or licensed production plants in other parts of Europe, as well as in Brazil, Australia, India, Mexico and Japan.  By the end of the 1960s, Cummins sales and service network had expanded to 98 countries, with more than 2,500 agents.  Through these efforts, Cummins internationalized earlier than most American companies. 

Cummins, meanwhile, is facing new challenges at home.  The U.S. truck industry continued to consolidate, with more and more engine makers merging with truck manufacturers (Cummins also tried to merge with White Motor Company in 1963, but eventually abandoned the effort).  Cummins believes it won’t be long before demand for heavy diesel trucks returns.  Cummins management invested in the growing market for small engines.  In 1961, Cummins introduced the V series, a compact engine, which was soon being manufactured in England in partnership with Chrysler.  One of the more epochal events of the decade was the establishment in 1968 of a $23 million r&d center in Columbus, the most advanced of its kind in the world, under Mr. Tarr’s leadership and the encouragement of Joseph Elvin Miller.  With 88 laboratories and state-of-the-art equipment, the center further reinforces Cummins’ commitment to technological innovation and lays the foundation for its future development. 

Cummins’ investment in the technology center paid off quickly.  In 1970, the U.S. government passed the Clean Air Act, which set strict new limits on diesel emissions.  Thanks to its advanced research and development technology, Cummins engines not only meet, but exceed these standards, while improving fuel economy and reliability.  In the early 1970s, when the worldwide energy crisis and “economic stagnation” swept the United States, Cummins was also affected and its earnings declined. The workers of the Columbus Diesel Union went on strike in the first long labor dispute in Cummins’ history.  But the increased accountability of workers, the discovery of new flexible market methods and other labor-management changes brought about by the strike caught the attention of the industry.  However, the company invested in several expansions in unrelated areas that did not succeed;  Cummins sold the joint ventures within a few years and returned to its core business of diesel engines. 

Cummins’ investment in the technology center paid off quickly.  In 1970, the U.S. government passed the Clean Air Act, which set strict new limits on diesel emissions.  Thanks to its advanced research and development technology, Cummins engines not only meet, but exceed these standards, while improving fuel economy and reliability.  In the early 1970s, when the worldwide energy crisis and “economic stagnation” swept the United States, Cummins was also affected and its earnings declined. The workers of the Columbus Diesel Union went on strike in the first long labor dispute in Cummins’ history.  But the increased accountability of workers, the discovery of new flexible market methods and other labor-management changes brought about by the strike caught the attention of the industry.  However, the company invested in several expansions in unrelated areas that did not succeed;  Cummins sold the joint ventures within a few years and returned to its core business of diesel engines. 

Cummins’ investment in the technology center paid off quickly.  In 1970, the U.S. government passed the Clean Air Act, which set strict new limits on diesel emissions.  Thanks to its advanced research and development technology, Cummins engines not only meet, but exceed these standards, while improving fuel economy and reliability.  In the early 1970s, when the worldwide energy crisis and “economic stagnation” swept the United States, Cummins was also affected and its earnings declined. The workers of the Columbus Diesel Union went on strike in the first long labor dispute in Cummins’ history.  But the increased accountability of workers, the discovery of new flexible market methods and other labor-management changes brought about by the strike caught the attention of the industry.  However, the company invested in several expansions in unrelated areas that did not succeed;  Cummins sold the joint ventures within a few years and returned to its core business of diesel engines. 

Cummins’s Business Development in China

Cummins and China’s history can be traced back to more than half a century ago in the 1940s.  On March 11, 1941, US President Franklin Roosevelt signed the Lend-Lease Act, providing wartime aid to 38 countries, including China.  Among the military aid to China are River Defense patrol boats and military trucks equipped with Cummins engines. 

At the end of 1944, a Chongqing enterprise sent a letter to Cummins seeking to establish a business relationship to produce Cummins engines locally in China. Erwin Miller, then the general manager of Cummins Engine Company, expressed his great interest in the letter in the hope that Cummins could set up a factory in China after the Sino-Japanese War.  For reasons well known to all, Mr Miller’s idea could only become a reality three decades later, in the 1970s, with the gradual detente between America and China. 

Cummins and its affiliated subsidiaries have invested more than us $1 billion in China. As a foreign investor in China’s diesel engine industry, Cummins began its business relationship with China in 1975, when Mr. Alvin Miller, chairman of Cummins, visited Beijing for the first time and became one of the first American entrepreneurs to seek business cooperation in China.  The first Cummins China office was established in Beijing in 1979 when China opened to the outside world after the establishment of diplomatic relations between China and the United States. 

Cummins has long localized engine production in China.  In 1981, Chongqing Engine Plant began to produce Cummins engines under license. In 1995, Cummins first Joint-venture engine plant in China was established.  Cummins (China) Investment Co., Ltd. was established in Beijing in 1997 to manage Cummins’ investment and business development in East Asia.  So far, Cummins has a total of 30 facilities in China, including 16 joint ventures, with more than 10,000 employees, producing engines, generator sets, alternators, filtration systems, turbocharging systems, emission treatment systems, fuel systems and other products.  Cummins service network in China includes 19 regional service centers and more than 2,000 authorized dealers of wholly owned and joint ventures in China

Cummins has long adhered to the strategic alliance with large Chinese enterprises to achieve common development.  Foreign diesel engine as an early visit to local production enterprises, more than 40 years to Cummins has with Dongfeng motor, Shanqi group, Foton, Jianghuai automobile, Liugong, leading commercial vehicle of China, Chongqing machinery and equipment manufacturing enterprises set up six joint engine, Cummins engine 24 series for 15 a local production in China.

Cummins is one of the first foreign diesel engine companies to set up a R&D center in China. In August 2006, Cummins and Dongfeng jointly set up an engine technology R&D center in Wuhan, Hubei province, officially opened.  After more than 40 years of development, China has become one of the largest and fastest growing overseas markets of Cummins worldwide.  Cummins has become an integral part of China’s engine industry and has made its own contribution to the modernization of China’s engine industry through joint venture/wholly owned production and technology transfer.

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