A new joint venture, Eaton Cummins Automated Manual Transmission Technologies, includes current Eaton AMTs as well as a new, heavy-duty AMT slated for introduction later this year, plus future AMT products designed for commercial vehicle markets worldwide.
Building on a well-established commercial vehicle powertrain partnership, Eaton and Cummins announced the new venture April 10. The two companies will jointly design, develop, manufacture and service a global portfolio of automated manual transmissions for medium- and heavy-duty commercial vehicles.
Cummins and Eaton will each own 50% of the new joint venture, and Eaton will receive $600 million in cash from Cummins for its interest.
The new joint venture includes both current Eaton AMTs as well as a new, heavy-duty AMT slated for introduction later this year, plus future AMT products designed for commercial vehicle markets worldwide. Both Cummins and Eaton dealers worldwide will support the new company’s AMT products.
Ken Davis, president of Eaton’s Vehicle Group, said in a conference call that the new joint venture company will develop both proprietary AMTs that are vertically integrated with Cummins diesel engines, as well as stand-alone AMTs for OEMs and for customers spec’ing non-Cummins engine solutions.
Assuming the required regulatory approvals and customary closing conditions are met, the companies expect the transaction to close in the third quarter. Cummins will consolidate joint venture results as part of its Components business segment.
Eaton’s Vehicle Group will retain its global manual transmission business, global clutch business, current generation medium-duty and heavy-duty automated transmission business outside of North America, global aftermarket business, light-duty transmission business, agricultural transmission business, and global automotive business and associated product lines.
“Eaton Cummins Automated Transmission Technologies brings together two strong companies that have worked together for decades, have similar values and have a shared commitment to their customer’s success," said Ed Pence, vice president and general manager of Cummins High Horsepower Engine Group. "This announcement today is a historic milestone in Cummins’ efforts to become a global powertrain solutions provider by supplying our customers the best-performing commercial vehicles possible – with that is with our own engines, or supporting proprietary OEM diesel engines.”
Pence added that the new joint venture is wholly in keeping with Cummins’ historical product offerings, and will complement those existing product lines as well. “When you look at our history at Cummins and the engines, turbochargers, emissions and air-handling solutions as well as our filtration and fuel systems, we believe this new joint venture fits very well into that existing product portfolio and will give our global OEM partners even more choices to help them develop the best performing commercial vehicles they can using the specifications of their choosing.”
Cummins Chairman and CEO Tom Linebarger added, "Our growth strategy includes expanding our product offerings and extending our global footprint by becoming the world’s leading powertrain supplier. Our JV with Eaton will deliver the most advanced automated transmissions and develop an integrated powertrain and service network that supports our customers like never before.”