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Cummins buys out Westport natural gas joint venture for $20M

Engine maker takes over Westport Fuel Systems’ interest in spark-ignited engines

Cummins Inc. is paying $20 million to buy out the intellectual property of its 10-year joint venture with Westport Fuel Systems. (Photo: Cummins)

Cummins Inc. is now the sole owner of the former Cummins-Westport natural gas engine joint venture, a 10-year partnership that ended Dec. 31, 2021.

Westport Fuel Systems gets $20 million from Cummins in exchange for its share of intellectual property of the joint venture, which Cummins will continue to operate. Natural gas reduces smog-forming emissions by 90% compared to current EPA standards for nitrogen oxide air pollutants.

Watch now: Cummins takes over Westport portion of natural gas joint venture

Columbus, Indiana-based Cummins (NYSE: CMI) is adding a 15-liter natural gas-powered version of its X15 engine to its portfolio in 2024. Testing on the engine, introduced in China in 2020, begins this summer with Werner Enterprises.

Self-driving trucking software maker Plus was working with Cummins Westport to apply its supervised PlusDrive autonomous system to a 12-liter version of the Cummins natural gas engine, pairing what eventually could be driverless technology with a powertrain featuring near-zero carbon emissions.

Westport (NASDAQ: WPRT) will use the sale proceeds from Cummins to pursue a hydrogen high-pressure direct injection (HPDI) system, which Cummins may use in the 15-liter internal combustion engine initially planned for natural gas fuel. Cummins and Westport agreed to conduct an initial technical assessment of the hydrogen HPDI.

Decadelong pursuit

“We’ve been working on this since the early part of the last decade,” Cummins CEO Tom Linebarger told FreightWaves in a January interview. “How do we offer an engine where we can be more fuel agnostic?

“What we are seeing is an added cost of diesel engines where you have a chemical factory at the back to take out criteria pollutants. What could we do to get the same or close to the same combustion ratios [with] different ranges of fuels that require less aftertreatment?”

Cowen Inc. analyst Matt Elkott, who covers Cummins, wrote that Cummins’ hydrogen applications are a “mid-term positive” for the company’s shares but a technology that faces near-term challenges.

Cummiins, through its joint venture with Momentum, is “trying to create increased availability for systems that can actually store and transport fuel on vehicles,” Linebarger said. It took this approach in June 2020 when it formed a joint venture with NPROXX in Jülich, Germany, to gain access to the company’s hydrogen tank expertise.

“What we’re really trying to do is enable the industry by lowering the cost of storing, pressurizing and delivering gasses for trucking.”

The FreightWaves Top 500 For-Hire Carriers list includes Werner Enterprises (No. 10).

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Alan Adler

Alan Adler is an award-winning journalist who worked for The Associated Press and the Detroit Free Press. He also spent two decades in domestic and international media relations and executive communications with General Motors.