On Friday, Cummins announced an anticipated charge of nearly $2.04 billion in the fourth quarter following an agreement to settle regulatory claims related to emissions certification and compliance for specific pickup truck engines.

U.S. regulators expressed concerns about certain elements within Cummins' emissions systems that might hinder the efficiency of emissions control systems, potentially functioning as defeat devices. These systems supervise an engine's air-fuel ratio and emission output.

In a statement, Cummins clarified that it has found no evidence of deliberate misconduct and does not acknowledge any wrongdoing. The company initially revealed a review in 2019 and has already recalled specific RAM trucks equipped with its powertrains. Previously, it allocated $59 million as estimated costs for carrying out these recalls.

Cummins, whose clientele includes PACCAR, Daimler Trucks North America, and Stellantis, foresees disbursing approximately $1.93 billion of the total sum in the first half of the upcoming year. The regulatory bodies involved encompass the U.S. Environmental Protection Agency, the California Air Resources Board, the Environment and Natural Resources Division of the Department of Justice, and the California Attorney General's Office.

Source: Reuters