Cummins Inc. · NYSE:CMI
Cummins — 2024 Cummins Supplier Conference
49 slides from Cummins's conference presentation, Oct 4, 2024
Slide 1: 2024 Cummins Supplier Conference: Future Ready
2024 Cummins Supplier Conference FUTURE North America and Global READY FUTURE READY Communicate / Innovate October 4, 2024 Collaborate / Demonstrate Public
Slide 2: Agenda
Srikanth Padmanabhan Destination Zero and Cummins’ future Jose Samperio Strengthening our diesel on-highway core Eric Zhang Procurement update: partnering for success Jenny Bush Agenda Transforming Power Systems: data center growth, mining, microgrids Cummins Leadership Q&A session Jeff Wiltrout Cus
Slide 3: Welcome to the Cummins Supplier Conference
Welcome to the Cummins Supplier Conference Eric Zhang Global Procurement Leader October 2024 Public
Slide 4: Agenda
Srikanth Padmanabhan Destination Zero and Cummins’ future Jose Samperio Strengthening our diesel on-highway core Eric Zhang Procurement update: partnering for success Jenny Bush Agenda Transforming Power Systems: data center growth, mining, microgrids Cummins Leadership Q&A session Jeff Wiltrout Cus
Slide 5: Destination Zero and Cummins’ future
Destination Zero and Cummins’ future Srikanth Padmanabhan Executive Vice President and President, Operations October 2024 Public
Slide 6: Destination Zero is our winning growth strategy
DESTINATION ZERO IS OUR WINNING GROWTH STRATEGY. Our commitment to sustainability and helping our customers navigate the energy transition while growing our business. ▪ Innovative technologies ▪ Collaborative relationships with stakeholders and partners ▪ Skilled talent and leadership ▪ Application
Slide 7: Our customer-driven, multi-solution path
DESTINATION ZERO Our customer-driven, multi-solution path TODAY Advance today’s 2030 Many solutions 2040 Zero-emissions 2050 solutions and accelerate deployed and progressing solutions solutions for the future at varied paces broadly available Pacing factors for the transition: infrastructure, econo
Slide 8: Diesel remains a key technology for Cummins
Diesel remains a key technology for Cummins Public 8
Slide 9: Accelera: a unique mission
ACCELERA: A UNIQUE MISSION To accelerate the shift to net zero by pursuing the most promising paths forward. Public 9
Slide 10: Uniquely differentiated to win through the energy transition
Uniquely differentiated to win through the energy transition Complementary Startup + incumbent Strategic focus broad portfolio Public 10
Slide 11: We have raised our 2030 revenue guidance
We have raised our 2030 revenue guidance (compared to our 2022 Analyst Day) BASE BUSINESS* ACCELERA CUMMINS $39-$42B $3-$9B in $43-$48B in in revenue revenue in revenue in in 2030 2030 2030 *Base business excludes Atmus Public 11
Slide 12: Summary
Summary ▪ Cummins is uniquely positioned in our Destination Zero strategy ▪ HELM portfolio ▪ Zero emissions portfolio ▪ Product launches are critical ▪ Technology and product readiness ▪ Cost ▪ Capacity readiness ▪ Quality is job #1 in emissions compliance ▪ Zero-defect mindset Public 12
Slide 13: Agenda
Srikanth Padmanabhan Destination Zero and Cummins’ future Jose Samperio Strengthening our diesel on-highway core Eric Zhang Procurement update: partnering for success Jenny Bush Agenda Transforming Power Systems: data center growth, mining, microgrids Cummins Leadership Q&A session Jeff Wiltrout Cus
Slide 14: Strengthening our diesel on-highway core
Strengthening our diesel on-highway core Jose Samperio Vice President, North American On-Highway Engine Business October 2024 Public
Slide 15: Strengthening our position
Strengthening our position By strategically evolving our portfolio Public 15
Slide 16: Strengthening our position: power of partnership
Strengthening our position Through the power of partnership Strengthening and expanding Advancing and testing Improving and promoting a existing partnerships in core new technologies with fleets more robust infrastructure and new technologies and key customers Public 16
Slide 17: New product launches over the next 3 years will drive our future success
New product launches over the next 3 years will drive our future success X15 B7.2 X10 X15N 17
Slide 18: New component technology accompanying these products
New component technology accompanying these products to drive our future success X15 B7.2 X10 X15N TURBOS TURBOS TURBOS TURBOS HE400 VARIABLE GEOMETRY HE400 VARIABLE GEOMETRY HE400 VARIABLE GEOMETRY HE300 WASTE GATE HE450 VARIABLE GEOMETRY ELECTRONICS ELECTRONICS ELECTRONICS ELECTRONICS CM3550 CM355
Slide 19: Global Powertrain Leader
Global Powertrain Leader C r e a t i n g c h o i c e , a d v a n c i n g s u s t a i n a b i l i t y, i m p r o v i n g t h e c u s t o m e r experience, and driving innovation. Public 19
Slide 20: My point of view
My point of view Cummins is going to be in engines and components for a long time. KEY CHALLENGES AHEAD • Diesel • Regulations • Hydrogen • Increasing costs • Alt fuels, including Octane and Natural Gas • Global and local trade & supply base • Hybrids • Risk of disinvestment of diesel engines too ea
Slide 21: Agenda
Srikanth Padmanabhan Destination Zero and Cummins’ future Jose Samperio Strengthening our diesel on-highway core Eric Zhang Procurement update: partnering for success Jenny Bush Agenda Transforming Power Systems: data center growth, mining, microgrids Cummins Leadership Q&A session Jeff Wiltrout Cus
Slide 22: Procurement update: partnering for success
Procurement update: partnering for success Eric Zhang Global Procurement Leader October 2024 Public
Slide 23: Our global procurement vision
OUR GLOBAL PROCUREMENT VISION We deliver industry -leading value by attracting and inspiring people who build a competitive, future-ready and resilient supply base . 23
Slide 24: Procurement Structure Change
Procurement Structure Change Why shift? How to shift? Impact to supplier? Category and BU Procurement Leader Simplifying the structure Clear Role & Responsibility Reducing silos Effective Improving the decision Collaboration Collaboration speed and agility Performance Driven-Culture Strengthening co
Slide 25: Procurement Leadership Team
Procurement Leadership Team Eric Zhang Global Procurement Leader – Kim Klosterman Executive Administrative Assistant Cummins Inc. Interim Sukhesh Paruchuri Alistair Halliday Hamed Majzoubi Ryan Day Suzanne Wells Robert Rivas Electrical Systems and Power System and SPT & Manufactured Materials & Mech
Slide 26: 2024/2025 Procurement Priorities
2024/2025 Procurement Priorities Simplify Structures for Partner with Suppliers to Ensure Success of Address Top Supply Revamp Supplier More Effective Build a Robust CR Critical VPI Launch Continuity Issues and Performance Communication and Pipeline including Dual and Drive Early Accelerate Geopolit
Slide 27: Strengthen Foundations for Win-Win Relationship
Strengthen Foundations for Win-Win Relationship From Cummins To Supplier Regard strategic suppliers as Offer Cummins best price 1 partners for growth matching our scale 2 Build should cost capability and modeling accuracy Rationalize cost structure to become market competitive Win-Win 3 Minimize “Ef
Slide 28: Fair and Transparent Performance Management Process
Fair and Transparent Performance Management Process Key to Clear Strong Continuous Success Expectations Partnerships Improvement You are critical to Focus on Supplier business Use scorecard to delivering world- performance reviews for drive improvement; class products and management; align feedback
Slide 29: What to Expect
What to Expect • Show performance history and trends Performance • Measurement against all • No complicated, time- defined performance metrics consuming implementations Measurement Ease-of-use ACCOUNTABILITY P E R F O R M A N C E VISIBILITY - D R I V E N C U L T U R E • Easy to grow, manage and Rela
Slide 30: Expectation to Supplier Partners
Expectation to Supplier Partners 1 2 3 4 Leading TCO Competitiveness Support VPI Development Enhance SC resilience Promote zero defect quality • Improve TCO competitiveness • Ensure launch success for VPI • Focus on SC risk prevention • Promote ZDM culture • Ensure to hit VPI target cost • Promote p
Slide 31: Areas of Opportunity for Cummins (from the VOS)
Areas of Opportunity for Cummins (from the VOS) Structure Change Collaboration Process Improvements ▪ Clarity for responsibility ▪ Grow with ICE ▪ Collaborate on demand and support across teams management and forecast ▪ Fair and transparent ▪ Effective communication performance measurement ▪ Hand of
Slide 32: Break
Break 15 Minutes October 2024 Public
Slide 33: Agenda
Srikanth Padmanabhan Destination Zero and Cummins’ future Jose Samperio Strengthening our diesel on-highway core Eric Zhang Procurement update: partnering for success Jenny Bush Agenda Transforming Power Systems: data center growth, mining, microgrids Cummins Leadership Q&A session Jeff Wiltrout Cus
Slide 34: Transforming Power Systems: data center growth, mining and microgrids
Transforming Power Systems: data center growth, mining and microgrids Jenny Bush Vice President and President, Power Systems October 2024 Public
Slide 35: Power Systems Business
Power Systems Business OUR SEGMENTS POWER GENERATION We serve a wide DATA WASTEWATER array of markets CENTERS COMMERCIAL TREATMENT HEALTHCARE TELECOM across the economy RESIDENTIAL RENTAL MINING CONSUMER PUBLIC UTILITIES We have to win in power TRANSPORT generation and mining MINING RAIL OIL & GAS D
Slide 36: Transforming Power Systems
Transforming Power Systems Driving business performance through rapid transformation FOCUS AREAS 2022 $5.0B PRICE EFFICIENCY REALIZATION IMPROVEMENTS 2023 $5.7B 2024F Up 3 to 8 % IMPROVED LOCALIZATION REDUCED RAPID ASSET PRODUCT CAPACITY REVENUE UTILIZATION PROLIFERATION EXPANSION Public 36
Slide 37: Data Center growth
Data Center growth Driving increased Power Generation demand $12B DATA CENTER GROWTH $9B $8B MARKET DYNAMICS: $6.0B $7B Rapid growth driven by increased digitization, cloud adoption and the AI revolution 7-10% market growth from now to 2030 $4.6B $2.3B $3-4B $1.8B $2B OUR APPROACH: $1.4B $0.5B Expan
Slide 38: Power Systems growth pathways
Power Systems growth pathways SUSTAINED MINING GROWTH MICROGRIDS MARKET DYNAMICS: MARKET DYNAMICS: Adoption of new energy technologies has Increased need for grid resiliency driven by slowed, new entrants driving shift energy demand from vehicle electrification, in competitive landscape AI, and digi
Slide 39: Driving value in Power Systems
Driving value in Power Systems Collaborate with Leveraging the strategic Driving growth supplier partners to advantage of global distribution through focused remove constraints and scale of Cummins investments Public 39
Slide 40: Q+A
Q+A
Slide 41: Agenda
Srikanth Padmanabhan Destination Zero and Cummins’ future Jose Samperio Strengthening our diesel on-highway core Eric Zhang Procurement update: partnering for success Jenny Bush Agenda Transforming Power Systems: data center growth, mining, microgrids Cummins Leadership Q&A session Jeff Wiltrout Cus
Slide 42: Customer perspectives panel
Customer perspectives panel Jeff Wiltrout Vice President, Corporate Strategy October 2024 Public
Slide 43: Customer perspectives panel
Customer perspectives panel Jeff Wiltrout Jose Samperio Chris Calas Paula Owens-Rath Vice President, Corporate Strategy Vice President, North American Executive Director- Americas On- Global Sales Director, Power On-Highway Engine Business Highway Business Generation Cummins Emission Solutions 43
Slide 44: Agenda
Srikanth Padmanabhan Destination Zero and Cummins’ future Jose Samperio Strengthening our diesel on-highway core Eric Zhang Procurement update: partnering for success Jenny Bush Agenda Transforming Power Systems: data center growth, mining, microgrids Cummins Leadership Q&A session Jeff Wiltrout Cus
Slide 45: Where does Cummins need help and closing remarks
Where does Cummins need help and closing remarks Ashwath Ram Vice President, Supply Chain October 2024 Public
Slide 46: Growing ICE Products: Challenges
Growing ICE Products: Challenges COSTS GEOPOLITICAL REGULATORY SUPPLY INVESTING IN TENSIONS COMPLIANCE CONTINUITY NEW TECH 46
Slide 47: Growing ICE Products: Supplier Opportunities
Growing ICE Products: Supplier Opportunities IMPROVING RELATIONSHIP PRODUCT RELIABLE RESPONSIVENESS COSTS BUILDING QUALITY DELIVERY &TRANSPARENCY 47
Slide 48: Closing Comments
Closing Comments FUTURE READY FUTURE READY Communicate / Innovate Collaborate / Demonstrate
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