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Ram truck sales to roll on as key supplier Cummins probes emissions

April 30, 2019

Fiat Chrysler Automobiles NV will continue to sell big versions of its Ram pickups while Cummins Inc. reviews how it certifies the emissions of engines it supplies to the carmaker.

Indiana-based Cummins will check certification and compliance processes for engines in the 2019 Ram 2500 and 3500 trucks after conversations with the U.S. Environmental Protection Agency and the California Air Resources Board, the company said Tuesday, on the same day it issued its quarterly earnings report.

“We are reviewing our certification process and it’s too early to tell what, if any actions, would or might be needed,” Jon Mills, a Cummins spokesman, said in an email.

Fiat Chrysler said it welcomed the review and said it would cooperate as necessary, adding the discussions are taking place between Cummins and other stakeholders.

The carmaker in January agreed to pay about $800 million in fines and costs to settle lawsuits brought by states, car owners and the U.S. Justice Department, which said earlier versions of the company’s diesel-powered pickups and SUVs violated clean-air rules. Last week, the Justice Department opened a criminal investigation into Ford Motor Co.’s emissions certification process, intensifying an issue the automaker disclosed two months ago.

Ford is at least the third major automaker to face a U.S. federal investigation over emissions in the span of a few years. Volkswagen AG paid a $4.3 billion penalty in 2017 after installing so-called defeat devices in its diesel engines to bypass emissions tests.

Fiat Chrysler debuted revamped versions of its heavy-duty Ram pickups at the Detroit auto show in January and started sales in the second quarter.

“We do not comment on ongoing investigations,” the EPA said, without specifying if the agency had started a formal probe of Cummins.

Cummins reported a profit of $663 million, or $4.20 per share, in the first quarter, up from $325 million, or $1.96 per share, in the same period of 2018. Revenue jumped 8 percent, to $6 billion.

First quarter sales in North America improved by 13 percent while international revenues increased by 1 percent.

“The company shipped a record number of truck engines in North America during the first quarter,” said CEO Tom Linebarger in written remarks. “Our market-leading position in this region reflects our close partnerships with our customers who rely on us to provide a broad range of power solutions for their needs.”

Cummins shares rose 1.3 percent Tuesday, to $166.29 each.

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