On A Charge: Truck Engine Giant Cummins Challenges Tesla By Acquiring Battery Firm
Cummins (CMI) shares rose after the truck engine giant announced Wednesday that it has bought a vehicle battery systems business from British sustainable technologies firm Johnson Matthey.
X It comes as the trucking industry moves toward alternative-fuel trucks, most notably the vaunted Tesla Semi, which was unveiled at a November press conference by Tesla (TSLA) CEO Elon Musk. Nikola Motor also announced Tuesday it is to build a $ 1 billion hydrogen-electric semi truck factory in Arizona. Last Auguest, Cummins unveiled the Aeos, a demonstration class 7 truck with a 100-mile range.
Cummins rose 0.7% to 188.55 on the stock market today after hitting 191.21 intraday. Shares are still in range from a 181.25 buy point from a shallow cup base cleared in early January.
The Fortune 500 company has taken over Johnson Matthey Battery Systems, which specializes in high-voltage automotive grade battery systems for electric and hybrid vehicles. Cummins and Johnson Matthey plan to work together to help develop high energy battery materials for commercial heavy duty applications.
The newly acquired subsidiary is one of Europe’s largest lithium-ion battery system suppliers and has 50 employees.
“The addition of Johnson Matthey Battery Systems’ technical expertise and customer base in markets that are more rapidly adopting electrification further positions us as a global energy storage supplier,” Cummins CEO Tom Linebarger said. “By combining our electrification capabilities, portfolio of diverse power solutions, and global network, Cummins is uniquely positioned to lead in electrification.”
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He also said the company is aiming to offer a full range of quality products to customers regardless of whether they want to use electric, diesel, natural gas or other energy solutions.
The deal, which was sealed for an undisclosed sum on Wednesday, was seen as a win-win by Johnson Matthey CEO Robert MacLeod.
“It will enable us to grow our position in high energy battery materials, particularly for heavy duty applications, and apply our chemistry expertise to develop new products that will give our customers, and ultimately consumers, the performance they demand from electrically powered vehicles,” MacLeod said.
Cummins acquired Brammo, known for designing and developing low-voltage battery packs for mobile and stationary applications, last October.
Other industry leading names were having a mixed day, with Oshkosh (OSK) rose 0.1%, Spartan Motors (SPAR) fell 0.9%, Paccar (PCAR) lost 2.1%, Commercial Vehicle Group (CVGI) retreated 3% and Navistar International (NAV) advanced 0.6%.
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