Cummins Inc. (CMI) Earnings Call Transcript & Summary

Good afternoon, everybody. I'm Ross Gilardi, senior machinery analyst at Bank of America. I hope everyone has enjoyed the Hydrogen event and is finding it a very productive use of time. We had Cummins speak at the first Hydrogen day earlier in the year, and we thought it made a lot of sense to invite Amy Davis, President of Cummins' New Power segment, to return to give us an update, along with Jack Kienzler, who runs IR and was very involved in his pre-IR career at Cummins with the acquisition of Hydrogenics and the buildout of the New Power segment. Amy joined Cummins in 1994, has got extensive leadership experiences across the Cummins' 5 business segments. So she is a great person to ask all sorts of questions, too. Prior to our current role in New Power, Amy served in Cummins' Components business as the VP and General Manager of the Filtration business, which is a world leader in OEM and aftermarket filtration solutions for diesel engines, transmissions and industrial applications. In addition, Amy served in Cummins' Engine business in its sales and marketing, field sales, OEM sales and marketing communications strategy, amongst various other roles. So with that, Amy and Jack, thanks so much for being here. Amy, I think you were going to start off with, the first 5 or 10 minutes or so, just walking through some overview slides to kind of level set everybody. I will hand it over to you. Thanks.

Thanks, Ross. Thanks for having me here. Yes, we have just a few slides that really take the whole Cummins overview and put the New Power business in the context of our overall Cummins business. I'm not able to see this slide. So I'm going to trust here, Jack, that you can show them and will -- is there a way I can possibly [ see the slide ]?

[ I'm not seeing them either ].

Let me just take a look here. Sorry about that. I was expecting I would be able to see them. So maybe you can just tell me which slide we are on, if we move, Jack, to the first slide.

[ Yes. That's all right ].

Great. So you can see Cummins, really over a 100-year company, nearly 60,000 employees, we really redefined ourselves in the '80s as a power company, not just an engine company, which is really the roots of the company, and expanded into a lot of different power kind of applications, like power generation, and expanded our engines and now, today, build over 1 million engines a year. You can see that we are big investors in R&T, with almost $1 billion, and really have invested a lot in our Distribution network over the last 10 years. We have over 8,000 distributor points around the world. So if you go to the next, Slide 3, we serve many markets and applications. So you can see, and as we start to think about the New Power, you can see that we have relationships in most industrial applications that will be decarbonizing. And so we really see that we're in a unique position, having been suppliers in these industries with deep application knowledge in all of these segments and applications, that we're able to apply as we move into alternative energy and alternative power sources. Slide 4, I think, puts in context our overall strategy. And you can see there's fundamental capabilities that we have built over 100 years being in these industries. And so we really think the foundation of technology leadership, it's foundational to who we are at Cummins. And so we really want to build and expand on that our scale that we have in -- over manufacturing and countries all around the world and then this Distribution network I talked about, which offers the ability to touch end user applications and support products all around the world and then a deep experience with partnerships and customers. So as I mentioned, most of those segments, we have over 100 years in different partnerships and have really expanded those over the past 25 years that I've been with the company, beyond just engine kind of support. And so you may know our 4 core segments, our -- as our Engine segment, our Power Systems segment, which is high-horsepower engines and power generators, as well as Components, which has Filtration, turbocharging technologies, fuel systems and electronics technologies as well as our JV with Eaton resides there. And of course, we have our aftertreatment, that's it in the Components segment as well, and then Distribution. So those are the core businesses at Cummins, and New Power really sits kind of beneath that. We sit a bit outside of the core very purposefully. And it started that way. As was mentioned, Jack was in the strategy group, and really, we kept it kind of incubating in the strategy group and formally formed the New Power segment. And I took over leadership of that segment in June of last year, so about a year now I've been at the helm. And you can see, in addition to our New Power segment, we have other growth platforms we're pursuing in terms of looking at other attractive markets, and the New Power segment is opening up a lot of those to us and building on our strength in the powertrain. So now to talk about New Power. As I mentioned, this has been a bit of an incubation process, combining a lot of our years of research in the technologies and bundling that with some acquisitions. So we started in the battery space, and we started with our Brammo acquisition, which is low voltage. And then we coupled that with our Johnson Matthey Battery Systems, and that's more high voltage-focused. And we kind of brought those together into an Electrified Power segment first and really started just leveraging some of those customers that those companies had, building battery knowledge and started our own battery programs. Then we invested in EDI, which had powertrain expertise as kind of an integrator. And so that really brought us into thinking, and I'll talk in a few minutes about the whole powertrain and other components, and how we could play a role as a system integrator for the entire powertrain. And then we shift to hydrogen, where we acquired GE's assets for solid oxide and then acquired Hydrogenics, which has the electrolyzer and fuel cell capability, for over 70 years of experience in those segments with those technologies. And so then, last year, we also acquired the NPROXX tanks -- or sorry, we did a JV on the NPROXX tanks, but that technology is proving to be really interesting in both natural gas kind of applications today as well as it will be very applicable for hydrogen. So going on, you can see we actually have quite a footprint that we've established now across our New Power segment. If you look at Oregon and Indiana and the U.K., that's where most of our battery stuff is. And then in California is where our powertrain integration is. We also do powertrain integration in Darlington in the U.K., and that's capable of actually building full powertrains or trucks conversions when we need to. And then Fridley and New York is where our solid oxide team is. And then the Hydrogenics and the fuel cell and electrolyzer stuff is in Canada and Belgium, today, and Gladbach, and then we're getting ready to hopefully commission Herten here in the next couple of months. And then we most recently announced our investment in Spain, and we have a tech center in Wuhan that we're expanding for the hydrogen work. So quite a footprint now that's come together. And the way I organize today is around these 4 technologies primarily. I look at battery electric, the batteries and the components on those drivetrains together, and we do components as well as powertrain systems, in some cases, for customers. And then we do the same on fuel cells. So we look at the fuel cell stacks, the engines, but also, in some cases, we're looking at the integration of the powertrain. And then we look at the commonality across those power trains. And then we have hydrogen production on our electrolyzer business, with both PEM and alkaline. And then we're thinking about our solid oxide and our PEM fuel cells in the stationary space as well. And just given that those are different customers, we think it's important to look at them a little bit differently. So today, if we go to the next slide, you can see we have fuel cells in -- and electrolyzers in a lot of applications already. And this only lists a few of them, to be honest, because we have just announced a commercial ferry. We have a helicopter that we just launched in the Boston area. And on the electrolysis side, I think I had on the last slide back there, we just launched the biggest PEM electrolysis site late last year with Becancour. And we have some refueling stations as well that we strategically placed in key locations with partnerships. So a broad array of already products running that we're learning from and supporting customers. And then I thought it would be helpful for you just to see kind of how we're thinking about our product portfolio as we look at this space. So you can see, today, we've been doing hybrid electric vehicles for quite a long time. We have hybrid systems running. And if you think about like how we apply that learning as we electrify the rest of the vehicle, and so we have batteries or fuel cells that can provide energy and energy storage. And then you also have the drivetrain components, so the traction drive system, if you will. And we believe there can be some real commonality built up across those, and there's not really a lot on the market today that is built or designed for heavy-duty kind of applications. So you remember our application slide, we were all over the map, and all those applications tend to be very heavy duty in nature. And so that, we feel, is important to really look at systems that will be built for this rough environment. And then lastly, I'll just cover our New Power strategy. So as I mentioned, we have a huge infrastructure and set of relationships to build upon. And so one piece of our strategy is making sure that we support our customers as they transition their power and decarbonize their businesses. But we also see a bunch of new customers opening up to us. And it's really important that, in our business, we're looking at finding those new business opportunities and leveraging Cummins' capabilities where we can. But in some cases, we are still looking and finding new partnerships to go after these new business opportunities. So I'll pause there. I think that's the last slide. And I'm sorry if I went a little long, but we'll turn it over for some questions.

All right. That's great, Amy. Thanks for the overview. I guess my first question is, clearly, Cummins is trying to make sure it's got available and offer anything and everything that your core customers want in terms of powertrain alternatives, whether it's internal combustion engine or all the lower zero-emission alternatives. So maybe you can just talk a little bit more about Cummins' just go-to-market strategy. Is it coordinated with the legacy ICE business? Are you speaking to the same people at your various OEM customers? And just really, how do you actually market the full range of Cummins' alternatives to the same customer?

Yes. So my last slide that I talked about, the 2 kind of prongs of our strategy. So the first prong in terms of really helping our core customers transform and decarbonize their businesses and their frameworks and networks, there are some really strategic ways that we can leverage Cummins' relationships in the core. And as you can imagine, because we have such long-standing relationships with every truck OEM and most off-highway as well, we have regular panel meetings, CEO meetings, senior-level meetings as well as product planning sessions and other things, that's just part of the partnership framework within Cummins. And so it opens doors all the time to opportunities and getting ahead of things that might be coming and how the OEMs are thinking about what products they're going to be looking at next and their total product platform. So we leverage that whole infrastructure where it makes a lot of sense. And as I mentioned, we have just deep-duty cycle knowledge. So in the sense that we've been doing application engineering in these spaces for 100 years, so we know these spaces. And so transforming the application knowledge into the right needs and requirements analysis for our product design is another, I think, fundamental way that we leverage Cummins' core capabilities. But on the other side, there's places where -- sorry, I just have to say one more thing because I would be remiss if I didn't mention Distribution, which, of course, with all those sites out there, we have this huge footprint to be able to offer support of the products, which a lot of the competitors in this space don't really have. But then, in the new area, we're really looking at strategic partnerships. So we have quite a lot of strategic partnership discussions underway, some announced, some not, but finding ways to partner with folks in these new spaces, JVs in some cases, to really get market access and build sort of -- combine our product capabilities with some of the market expertise and market access that some of these other players would provide.

Can you talk a little bit more about the capital spending commitment that Cummins as a company is making to the New Power segment overall? And just how much funding are you getting from the company? Is it enough? Are you pushing for more CapEx? And would you even know how to spend it right now if you had it?

Yes. Ross, I feel like we are really well-capitalized. I think it's one of the benefits of being a company like Cummins with huge cash generation and strategic commitment to this platform. And we don't follow the normal capital allocation process that we do in some of the other parts of Cummins. So it's not, every year, we look ahead and we fight for money and we say, what do we do, it's actually like regular. We refresh and regularly have to revisit our plans. We're very opportunistic with how we look at scanning the market and finding the things we need to do and combine that with some of the strategic investments. So you saw our footprint slide, just a couple of things to make you aware that are underway. We have expansions going on in both Mississauga and Belgium to expand our electrolyzer capacity, that will couple with the Spain site that will hopefully commission in 2023. We're getting ready to commission our Herten, Germany site for fuel cells, and that should hopefully launch in September with a ribbon-cutting. And then we are expanding in California, our powertrain site, in West Sacramento. So those are just a few of the site work. We're doing also in China, we're looking at expanding our manufacturing capability there. So that's kind of on the capacity side. And then, of course, on the R&T side, we are continuing to invest in the next generation of these products, getting pilots out there. And so we feel like, I think, we have a good handle on where to look, what to do. But it doesn't stop us from scanning. So we still -- even though, we are now a segment officially, I have a very close connection on the strategy side as we continue to scan the market and the technologies out there to be opportunistic, as I said.

If we look, if we focus specifically on hydrogen, I mean, Cummins has been investing really across the entire ecosystem. And just curious, from here, how do you really pick your spots? I mean do you need to be in hydrogen storage, electrolyzers, fuel cells? I mean do you expect to narrow your focus over time? And I had a question from the audience to just talk about the differentiation of your fuel cell in particular.

Yes. So I'm really happy with our portfolio. I don't see a benefit in narrowing that right now. I think we are benefited by having the different technologies, and we have the capacity to support each of those. And each of those can give us different ins into the market space. So kind of like we've used components over the years, where we couldn't sell full engines to people. We were able to introduce components into their systems and develop those partnerships and learn those customer applications. It's similar for me in this space. If I can perhaps partner on tanks for certain vehicles or just the fuel cell engine, not the full powertrain, it gives me the optionality to learn and partner with these broad array of applications that we serve. And we continue to look at the hydrogen ecosystem, if you will, to see how that's evolving, what technologies are proving to be challenging, will be differentiating, and we'll continue to scan that. And I think we would be opportunistic in places where we see that our -- some of our technology capabilities have a lot of synergy. Or it's hard and there will be a lot of differentiation there, and we want to sort of see then can we be a player in helping progress the technology in a differentiated way.

Further on hydrogen, just maybe you could talk about the $400 million electrolyzer target that you gave, I think, by 2025, correct me if I'm wrong there. And then how should we expect to see that scale? And then, in the next few years, I mean, you've had a couple of really interesting, exciting announcements fairly recently, and I'm going to ask you about Spain shortly. But just trying to get a better feel about the $400 million and how back end-loaded is it, do you have visibility right now to at least get half of the way there in the next couple of years?

Yes. I mean I think it will be back-loaded in the sense that most of these large-scale projects take 2 to 3 years to actually plan and implement. So if you're -- and a lot of them are announced but not funded yet. And so you see that the partnerships are lining up, and we're bidding on a lot of things and then waiting for the funding to come through. And so there's a lot of things moving on the big kind of projects. The good thing is, for us, we have an existing kind of core electrolyzer business that's selling into industry in some small-scale projects that we can keep going to keep things coming along. But the big projects, so a 240-megawatt kind of product, I mean, that in itself is probably $200 million in revenue. So one of these big ones gets you a long way there, but they take a long time to form and get funded and then industrialized.

So that would be -- I assume you're talking about Spain. Again, I'm going to ask you specifically about it in a moment, but is that $200 million to Cummins specifically?

Well, that would roughly -- I mean, I'm just estimating roughly. That would be roughly the revenue for Cummins in a project that size.

Yes. Okay. Got you. I get this question a lot, just about the economics of selling an electrolyzer for Cummins. Any economics for the developers of these big electrolysis projects?

So how do you mean? I mean the economics for us to sell electrolyzers into one of these? Do you want me to...

Yes. Yes.

Well, I mean, for us, you -- not only do you get the opportunity to just sell the equipment and help integrate the system, but you get the recurring revenue opportunity to possibly provide maintenance and support and other things through our Distribution business. So we think that is pretty exciting adjacencies for Distribution, who do -- we do a lot of power generation maintenance and servicing today and it's very synergistic. So those are key kind of positive economics for Cummins in that space.

Okay. I got you. And if I just think about all the different areas you're in and your revenue ramp over the next 5 years. Can you just give us a sense, like if your business turned out to be more electrolyzer-heavy and less fuel cell-heavy or more battery-heavier, what have you, like what do the mix seem like? What are the -- all these markets are still in sort of nascent stages of developing. But where do you think the profitability is better? Like if you had an electrolyzer-heavy revenue trajectory for the next several years, would that lead to more margin upside perhaps or the opposite? How do you think about that?

Yes. I think the electrolyzer profits should be strong. And I think the way I see the next 10 years anyway is it could become a very significant part of New Power's revenue. A lot of these electrolyzer projects have to play out to really build the infrastructure and the availability of hydrogen. So I think that will be a key part in fuel cell adoption itself. And so as we look at the adoption rates, I mean, they change, of course, all the time, and people seem to be getting more optimistic. But they're still pretty far out for fuel cells and the infrastructure will -- hopefully, all these commitments and aspirations that countries have made will come to fruition here within the next 10 years. So I think that will be a big part of our business and a profitable one.

Yes. Got it. All right. Spain. So yes, let's talk about the Spain project a little bit more and this hydrogen electrolyzer gigafactory that you're building in Spain. How did that come to be? When will you start to realize revenue from that project, kind of upside potential, and do you see more of these types of announcements, hopefully?

Yes. So we were looking at where to put our European facility for electrolyzers. We knew -- we know we need to invest in that capacity. We have the ability to expand our Belgium site right away, so we've acted on that immediately. But we wanted to strategically scan the markets, and so that work has gone on and Spain is a really -- a great country to build in. They -- I think their country alone has announced 4 gigawatts' worth of commitment, just in-country electrolysis capabilities. So huge opportunity, and having manufacturing there could give us some edge, if you will, on some of those projects. We already have significant manufacturing in Germany, another country which will have significant electrolysis projects. So we felt it was a good -- the labor availability, the costs as well as the positioning for Middle East projects and other things, combined with then a strategic partnership that we have going with Iberdrola, which makes it nice because we can see a pathway to lots of more opportunity and more projects with a company like Iberdrola.

Got it. Maybe you can talk about your relationship with Sinopec a bit? And what should we be looking for there? And do you think -- are you kind of assuming that, back to that $400 million number, which is kind of like the main number that you guys have thrown out there to the market, does that relationship potentially contribute meaningfully towards that objective in the next few years?

Yes. So we see China as a really important market. They've made significant announcements around their commitment to hydrogen, and we feel that they will follow through on that as a country and probably lead the way. And so being there with a strategic partner, we felt, is crucial really to success. Sinopec is in itself, I think, 10% of the hydrogen production today in China, that they are part of producing, so significant incumbent place to transform to green hydrogen and apply our electrolysis capability. So we announced an LOI, and we should be announcing more details on the commercial finalization of that agreement here in the coming months. So we can tell you more, and we'll look forward to that, but yes, access to big projects and a strategic partner who is in the hydrogen business today.

Maybe you can talk a little bit more about your fuel cells and just getting back to that differentiation question and just your product offering in fuel cells, how powerful are your fuel cells. Do you expect it you'll actually be more successful selling into the on-highway versus the off-highway markets or vice versa?

Yes. I mean I think -- so today, our fuel cell stacks can combine in parallel for building blocks effectively. That's how we compete in fuel cells to build the full engine system. And so we -- for example, our Alstom trains, they're 400-kilowatt trains with 200-kilowatt systems, but you can build those systems in various formations for sizes, et cetera. And I think we -- Hydrogenics has done a lot of different applications. So there's a lot of, let's say, building block experience that they've done because they have formed different blocks, different engine systems for a lot of different applications. So I think that gives us a real advantage because we have a lot of learning. Our system is also a dry system, with low pressure, so it only needs a blower. It doesn't need some of the components around it. So it can make it more reliable, more durable and lower cost. We also have product plans in place to really think about what's the right stack design for a heavy-duty truck and the heavier-duty applications. Because as those start to adopt, there might be -- we believe there will be some different differentiators in the stack design itself, and how we decide to form that, that could differentiate us in the market. So that's one of the things that's exciting about fuel cells is they're complex and they're highly technical. And so there's a lot of opportunity for differentiation. And so I'm really happy with what we have at building blocks and the product plan going forward. Again, we have the application knowledge, which I think will help us get the system right when heavy-duty truck adoption occurs, which is one of our core markets, as you know, today.

Got you. All right. Maybe we can just switch specifically to the on-highway market, which has, on the ICE side, has really been the core of Cummins over a very long period of time. And just looking at the different players there, I mean, there's -- there are a lot of truck OEMs around the world, but there's really 4 or 5 really big ones, particularly in the developed markets. PACCAR is one of your biggest, if not, biggest customers there. Is there any opportunity to work with them on hydrogen or battery electric? I think they're partnering with Toyota. Daimler and Volvo working together on hydrogen. Is there any real opening with either PACCAR or the top 5 or 6 global commercial vehicle OEMs to work together on either hydrogen or battery electric?

Yes. There's a ton of openings. I think that the dance, if you will, there's still a lot of dance partners who are having a waltz here or there, stepping back, coming together. I don't think it's settled. We have a project going on with PACCAR actually to, with some DOE funding, to do some fuel cell trucks that should come out next year, drayage trucks and one other application. We have a project with Scania, and we've put some waste vehicles that we did together with them. We are talking to other OEMs. We have a project -- another DOE project with Navistar. And one of the benefits, I think, is everybody is, I think, right now, doing a lot of pilot projects in the fuel cell space. And so that's what I mean by the dance, there's a lot of these going on, and the real solidification, if you will, of what exclusive partnerships is still forming. So we think we will have a role with multiple OEMs, and we're excited to be doing these pilots with them and have these ongoing, like I said, product planning and strategic high-level conversations that we do just as being an incumbent supplier with these OEMs.

Sorry, those 3 or 4 examples you just provided, were those on the hydrogen side, or was that on the battery electric side?

Sorry, those are all fuel cell examples of different truck projects that we have. Yes.

Okay. Okay. What about on battery electric? Let's just switch to that real quickly, kind of the same questions. I mean there are limited, at least amongst the major, major dance partners out there, that have all -- made all sorts of various announcements and so forth. Are there openings on that -- the battery electric side? I mean clearly, on the ICE side, Daimler has just outsourced all of its medium-duty business globally back to you guys. Is that sort of the end of the discussion and that's kind of like what Cummins' role is going to be with like a Daimler, for example, in the future? Or like are you going to also maybe play a role on the battery side at some point because they seem to have chosen a lot of partners already?

Yes, I think we will play a role. I mean we intend to, and we continue our battery development programs as well as our drivetrain component systems. And so while we don't have a big truck program today, we've done a lot of small ones as well as a lot in bus. And we are quoting a lot. So when you -- I think one of the confusing things to me sometimes is I see announcements also. And -- but yet I'm still talking to these OEMs, and we're responding to RFQs on them. So I think there's still not a lot of full bottom-up truck developments going on for BEVs. So what we see still is a lot of taking an existing chassis and quoting, modifying that and packing batteries in and around what's the existing frame rails. And so as the adoption happens, I think there will be more and more truck programs that will be true like designs-from-scratch electric vehicles. And there will be still some where there will be lower volume, that we'll be just doing more of working with the chassis we have. And I think they will keep quoting those, and we'll keep having opportunities at that because the technology is changing so quickly. The other thing that I'm worried about is how batteries are going to live in the medium -- a heavier medium-duty truck cycle is still quite a tough duty cycle. A transit bus is one of the hardest-duty cycles there is in terms of the idle and how the battery will have to go up and down. And we believe we have differentiating technology that will last in that, and we still are developing some other technologies that we think, eventually as people run these for 10 years, that will actually start to differentiate. And so I think there's a lot of runway here to see how the products actually play out and -- in our duty cycles, and then we'll be there and we'll keep quoting with the products that we can do differentiate.

All right. We just got 5 minutes left. I just wanted to squeeze in a few questions about rail. Maybe you can just talk broadly about rail. Rail is a market that Cummins, I think, has always sort of wanted to be bigger in on the ICE side and made some headways kind of here and there, but it hasn't been a huge market for you in the past. But on the fuel cell side, it seems to be where you've got a fair amount of traction, at least so far on the passenger side. So can you talk about the relationship with Alstom? And where is -- just talk about Cummins' role in -- with Alstom? And what's next on the passenger rail side?

Yes. So I think this is an exciting opportunity for Cummins. Rail makes a great early adopter for fuel cell. You have point-to-point. In some ways, it's a lower-cost way to electrify a rail line than doing the lines and the other things that require big investment and projects. So we're happy that we're the first with Alstom. I think that, as an early mover, is going to give us the right experience. And so we're on track to put 82 fuel cells for 41 trains by the end of '22. So that's kind of been our agreement with Alstom. But we're still partnering and talking about the future and other past railcar opportunities as well as looking at loco and saying, is there opportunities there to decarbonize with fuel cells there and what's that design have to look like to get that kind of power outputs. So I think this will be, in the short term, medium term, one of the places you'll see us really win hopefully and stand out.

Okay. Well, that's a good segue into my -- well, I'm going to make this last one a 2-parter, which the 2 parts don't really have like a huge relationship to each other, but I just want to make sure I get them both in. First of all, on the -- so on the freight locomotive side, so GM is partnering with Wabtec and freight locomotives. And are your fuel cells powerful enough to power a freight locomotive? If not, like when will they be at that point? And I don't know if this is farfetched or not, but could you actually see yourself partnering with someone like a Caterpillar, who is the other major player in that market and who, as we wrote about last week, we would think would potentially need a partner at some point, just given the GM-Wabtec announcement?

Yes. So we've done studies with loco partners, and I think our estimates say it would take around 1 -- greater than 1 megawatt anyway to power a loco. So we have systems right now that we can see 600 kilowatts. So I think we are seeing our pathway there and doing studies and partnerships with customers on the rail side, on the loco side. And I think, as I mentioned, this is key to us finding new avenues, new customers, new growth opportunities for Cummins. And we're on the scan for those. So we definitely are talking to lots of partners in this space. And so like I said, I think it will be a good opportunity for us, new business.

All right. And then just the last one, from the audience. I guess PLUG has talked about $500 million, I think, $500 million to $1 billion of low interest rate loans from the Department of Energy that are available. Can you use those programs, or are you using those programs?

Yes, absolutely. We are very actively looking at both the Department of Energy programs here in the U.S. and a lot of money available in Europe as well. So we have a team that's really constantly looking at those opportunities, finding ways to access that funding, partner with customers to do some of these projects. I mentioned the one we're doing with Navistar and PACCAR. So I think that's really a helpful way to get the technology out there, get some of the customers comfortable with experimenting with it and putting something in their fleet and not having to bear all the cost. And so it's a good win-win.

Okay. Terrific. Well, we're right about out of time now, Amy. So thanks so much for the update. I want to make sure everybody stays on time, but really appreciate your time today and learning more about what Cummins is up to and these different market opportunities. So thanks again. Thanks, everyone, for joining this session. Have a great day.

Thanks for having me.