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Cummins and Chinese equipment manufacturer Liu Gong have had a partnership for 10 years now, and the two, along with ZF, used the first day of Bauma 2013 to talk about their progress and showcase the latest fruit of that joint venture.
Nine months ago Cummins and Liu Gong started work on a factory in China. About a month ago the factory begin producing the first of its L9.3 engine that will go into Liu Gong wheel loaders for the Chinese market.
The L9.3 is optimized for the wheel loader, says Tom Linebarger, Cummins chairman and CEO. Previous Cummins engines used by Liu Gong didn’t have the right combinations of power, speed and torque matched specifically to wheel loader applications. But the new, Chinese-built engine and the ZF axles were designed specifically for this task.
Linebarger also emphasized the partnership will provide full service and support for all the machines produced under the agreement, saying that service and support is vital to the success of the business in developing markets. Cummins’ chief also noted that customers in these developing markets need affordable prices and the right balance between purchase cost and operating costs.
Zeng Guang-an, vice chairman and president of Liu Gong said that the market in China was down about five percent in the first quarter of 2013, but March showed some improvement and he expects it to grow between five and ten percent by the end of the year. Linebarger commented that the U.S. construction market was “not too bad,” but that the U.S. and Europe were likely to end up flat this year.
Liu Gong has 28 types of equipment on display at this year’s Bauma. By the time the next Bauma rolls around, 2016, the company hopes to have additional lines of equipment to show and to have doubled its sales, said Guang-an. Currently exports make up 18 percent of the company’s sales. Guang-an says he hopes to boost that to 25 percent by 2016 as well.