Thursday, 14 August 2014
Cummins to boost output by 50 per cent
Cummins Inc. is boosting annual investment in its Jamestown Engine Plant (JEP) by more than 50 per cent in a bid to hit 500 engines a day, mostly ISX15s.
Cummins is slated to spend nearly $100 million over the next three years to 2016 to boost production capability at the 40 year old plant.
The plant in Lakewood, New York, makes heavy-duty truck engines and the company is clearly responding to the downfall of Navistar International’s capability to produce in-house diesel engines for Class 8 trucks.
Navistar International’s demise began to unravel on former chief executive officer Daniel Ustian’s watch when a series of technology-related decisions prompted losses to multiply. Most of these were as a result of Ustian’s poor decisions vis-vis the use of Selective Catalytic Reduction (SCR).
Ustian famously signed off exhaust gas recirculation (EGR) technology for the company’s diesel engines, since when replacement chief executive officer Troy Clarke has made every effort to regain lost ground by embracing SCR, even to the point of going cap in hand to Cummins Inc. to keep Navistar’s Class 8 trucks, and others, rolling forward on the production lines and out into dealerships.
Clarke became Navistar CEO in April 2013; before that he was its chief operating officer since August 2012, when Ustian left the company suddenly.
All of which has been good news for Cummins. Now executives of the Columbus, Indiana-based company have said they will spend more than $30 million a year at the Jamestown Engine Plant (JEP) this year through to 2016, up from $19.3 million in 2013.
“We’ve been investing here heavily,” said Dave Crompton, president of the company’s engine business since July. “We’ve been investing on capacity for the last 18 to 24 months, and we feel good about our footprint now.”
Some of that investment no doubt will be down to the ISX5.0 engine with a compacted graphite iron (CGI) vee cylinder block – the first time the company has committed to CGI in a production engine.
Cummins holds a plurality market share for North American heavy-duty truck engines. Recently this fell below 40 per cent to 39 per cent for the first half of this year. Daimler Trucks North America is now in second spot at 26.8 per cent, according to WardsAuto.com.
Cummins started JEP in August 1974 and while the company ran most of its production out of the facility in Columbus, it needed additional space to make components.
Five years later, the company made its first engine in Jamestown, a 10-litre model. In 2002 and 2003 the company consolidated heavy-duty engine production at JEP, a one million-square-foot facility that employs about 1,500 — more than any other private employer in Chautauqua County, New York.
It is claimed the Jamestown Engine Plant makes more heavy-duty truck engines — 10 litres or more — than any other factory in North America.
Cummins sources engine blocks for 12- and 15-litre truck engines destined for JEP from foundries in China, Mexico and South Africa.
The ISX15 is the company’s best-selling diesel for trucks – thanks partly to Navistar – with most of them going to Kenworth Trucks and Peterbilt Motors, as well as Navistar.
Jamestown Engine Plant is home also to the Cummins Westport ISX12 G, a natural-gas power plant, which is of growing importance for Cummins.
Meanwhile, the Cummins 5-litre V8 ISX5.0 diesel engine is set to power the next generation Nissan Titan truck.