Cummins is expecting to have a $2 billion charge in the next few days to settle regulatory problems with more than 1 million pickup trucks.
The Columbus based engine manufacturer made the announcement this morning that it has reached an agreement in principle with regulators and plans to record the charge in the fourth quarter of this year to resolve these and other related matters.
Although the company does not explain the problems in today’s announcement, the company says agencies including 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 made claims regarding its emissions certification and compliance process for certain engines primarily used in pick-up trucks.
The company says it has cooperated fully with regulators and has already addressed many of the issues involved. After an extensive internal review and working with regulators, the company has seen no evidence that anyone acted in bad faith and does not admit wrongdoing.
The company has already recalled model year 2019 RAM 2500 and 3500 trucks and has initiated a the same trucks made from 2013 to 2018.
The company says about $1.9 billion of the charge will be payments expected to be made in the first half of 2024.
The settlements are subject to final regulatory and judicial approvals.