Meritor Acquisition and 2022 Financial Results
Table of Contents
Our equity income from these investees was as follows:
In millions
Manufacturing entities
Dongfeng Cummins Engine Company, Ltd.
Beijing Foton Cummins Engine Co., Ltd.
Chongqing Cummins Engine Company, Ltd.
Tata Cummins, Ltd.
All other manufacturers
Distribution entities
Komatsu Cummins Chile, Ltda.
All other distributors
Cummins share of net income(4)
2022
Years ended December 31,
2021
2020
$
45
20% $
82
19% $
63
17%
37
17%
112
26%
113
30%
32
14 %
39
9%
35
9%
27
12 %
18
4%
19 (1)
28 (2)
12%
131
32%
115 (3)
5 %
30%
44
20%
32
8%
31
8%
11
224
5%
10
2%
2
1 %
100 % $
424
100% $ 378
100%
(1) Includes $18 million in favorable adjustments related to tax changes within India's 2020-2021 Union Budget of India (India Tax Law Change) passed in March 2020. See NOTE 5,
"INCOME TAXES," to our Consolidated Financial Statements for additional information on India Tax Law Change.
(2) Includes a $28 million impairment of our joint venture with KAMAZ and $3 million of royalty charges as part of our costs associated with the suspension of our Russian operations. In
addition, on February 7, 2022, we purchased Westport Fuel System Inc.'s stake in Cummins Westport, Inc. (Westport JV). See NOTE 2, "ACQUISITIONS," and NOTE 23, "RUSSIAN
OPERATIONS," to our Consolidated Financial Statements for additional information.
(3) Includes $19 million in favorable adjustments related to India Tax Law Change, impairment charges of $13 million and loss on sale of business of $8 million for a joint venture in the
Power Systems segment. See NOTE 5, "INCOME TAXES," to our Consolidated Financial Statements for additional information on India Tax Law Change.
(4) 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 Net Income, see NOTE 4, "INVESTMENTS IN EQUITY INVESTEES," to our Consolidated
Financial Statements for additional information.
Manufacturing Entities
Our manufacturing joint ventures were generally 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, axles, drivelines, braking systems and automated 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,
which is consolidated due to our majority voting interest) discussed below are included in equity, royalty and interest income from investees and investments and advances
related to equity method investees in our Consolidated Statements of Net Income and Consolidated Balance Sheets, respectively.
•
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 and one of the largest medium-duty and heavy-duty truck manufacturers in China. DCEC produces 3.9 liter to 14.5 liter
diesel engines with a power range from 80 to 760 horsepower, natural gas engines and automated transmissions. On-highway engines are used in multiple applications in
light-duty and medium-duty trucks, special purpose vehicles, buses and heavy-duty trucks with a main market in China. Off-highway engines are used in a variety of
construction, power generation, marine and agriculture markets in China.
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 has two distinct lines of business - a light-duty business and a heavy-duty business. The light-duty business produces our families of ISF 2.5 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 and Brazil. Certain types of small construction equipment and industrial applications are also served
by these engine families. The heavy-duty business produces the X11, X12, X13 and X15, ranging from 10.5 liter to 14.5 liter, high performance heavy-duty diesel
engines and natural gas engines in Beijing. Certain types of construction equipment and industrial applications are also served by these engine families.
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