Diesel engine and electric power generator supplier Cummins Inc. has maxed-out its credit lines, which explains why the company is seeking financial assistance from the Indiana and New York state governments, according to the Indianapolis Star newspaper.
Cummins is asking the Indiana Legislature to provide collateral for a $35 million loan that Cummins needs to continue an R&D effort to develop a medium-bore engine that will satisfy federal emission standards scheduled to take effect in 2002, according to the newspaper.
Cummins Chairman Tim Solso appeared before Indiana lawmakers Tuesday to appeal for the loan guarantee.
Cummins is headquartered in Columbus, Ind., where the R&D effort is taking place. The “second-generation” engine would be assembled in Western New York, but Solso did not say how much money the company is seeking from New York politicians.
Cummins was thought by at least one industry analyst last year to be a takeover target due to questions about whether a relatively small engine supplier can survive in the increasingly global and consolidated auto, truck and heavy equipment industry. However, Solso said Cummins is not for sale.