Cummins expects $2 billion loss in fourth quarter due to emissions claims settlement By Reuters
© Reuters. The Cummins logo is visible in this image taken on April 10, 2023. REUTERS/Dado Ruvic/Illustration/File Photo
(Reuters) – Cummins said on Friday it expects to cost the company about $2.04 billion in the fourth quarter as it agrees to settle regulatory claims over emissions certification and compliance for some of its pickup truck engines.
U.S. regulators have raised concerns that some aspects of the emissions system could reduce the “effectiveness” of the emissions control system and act as a disabling device. These systems monitor and control the engine’s air and fuel ratios and overall emissions output.
“The company has seen no evidence that anyone acted in bad faith and does not acknowledge wrongdoing,” Cummins (NYSE:) said in a statement.
Cummins first published a review in 2019 and has already recalled certain RAM trucks equipped with the powertrain. Previously, the estimated cost to implement the recall was $59 million.
The company, whose customers include PACCAR (NASDAQ:), Daimler (OTC:) Trucks North America and Stellantis (NYSE:), said about $1.93 billion of the total payout is expected to be made in the first half of next year.
Government agencies involved include the U.S. Environmental Protection Agency, the California Air Resources Board, the Department of Justice’s Environment and Natural Resources Division, and the California Attorney General’s Office.
