Dealer Update Rocky Mountain Region...Per TSB 110277, for a window in 2010 all ISX/Q engines were...

January 2019

Dealer Update

Rocky Mountain Region

Depend on Cummins

2

Logistics

Exits

Restrooms

Timing

Refreshments

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Agenda – Parts

Topics

1. Introduction

2. Market Updates

3. Parts Promotions & Programs

4. Dealer Pricing & Policies

5. Channel Management

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Regional Dealer Field Support Team

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▪ Parts Managers

• First level support for parts operational issues and escalations

▪ Channel Managers

• Second level support to help direct/address general inquiries

• NEW Dealer inquiries, contracts and contract maintenance, channel readiness, certifications and training requirements

• Also help with system access and provide general dealer support

▪ Cummins Care

• 1-800-CUMMINS | Available for technical support

▪ Dealer Support Services

• 1-800-800-4230 | Available for non-technical support

▪ On-Highway Sales

• Primary support for new unit sales

▪ Branch Managers

• General Support | All inquiries about Rocky Mountain operations

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▪ Dealer Account Executive (DAE)

• Responsible for generating Cummins preference on engine sales through the OEM dealers and supporting the dealership operations. Large Markets

▪ Fleet Account Executive (FAE)

• Responsible for generating Cummins preference on engine sales through the Fleets. Large Markets

▪ Territory Account Executive (TAE)

• DAE/FAE combined roles in smaller markets

Role

Defined

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▪ Arizona and New Mexico

• Kris Young – Dealer AE

• TBD – Fleet AE

▪ Colorado

• Jeff Garberding – Dealer AE

• Annette Vettraino – Fleet AE

▪ Idaho

• Bryan Austin – Territory AE

▪ Montana, Wyoming and Western North Dakota

• Kelly Pleas – Territory AE

▪ Nevada

• Nic Dobson – Territory AE

▪ Utah

• Ron Dimmick – Dealer AE

• Rodney Nehring – Fleet AE

▪ Technical Support Managers (No Boundaries)

• Steve Boatright

• Beth Miya PUBLIC

Staff | Field Sales and Technical Support

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2018 Dealer Satisfaction Survey

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70

75

80

85

90

95

2010 2011 2012 2013 2014 2015 2016 2017 2018

Rocky Mountain v. North America on Dealer Satisfaction

Rocky Mountain Region North America

Once a Year

Improve our Support

Voice your Honesty

Results |

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2018 Dealer Satisfaction Survey Actions |

Understand Customer Urgency of Complaint

• Seek to Actively Engage with Dealer for Complete Discovery

Work to Resolve Parts/Service Issues Timely

• Enable Staff to Request Escalation when Necessary

Communicate: Easy to Reach and Return Phone Calls

• Improved On-Boarding and Customer Satisfaction Skills

Develop a Stronger Relationship

• 1-1-1 Strategy

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Cummins was founded by Clessie Cummins and

W.G. Irwin, who believed in the power of ideas and

had a shared vision of what ingenuity and hard work

could achieve.

Cummins took the available technology and transformed diesel into a

reliable and everyday use of transformation power source.

Our History

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Vision

Innovating for our customers to power their success.

What we want to accomplish

Mission

Making people’s lives better by powering a more

prosperous world.

Why we exist

Values

▪ Integrity

▪ Diversity & Inclusion

▪ Caring

How we will do it

▪ Excellence

▪ Teamwork

Our Story

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Why Choose Cummins?

1.3M+ Enginesbuilt in 2017 49-4,400 hp

Broad rangeof power

100 Years of

experience

Dealer locations worldwide

7,500Approx.

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Emissions LeadershipApplication Date In-Cylinder

Only

Cooled EGR NOx

Absorber

SCR Diesel

Particular

Filter

Diesel

Oxidation

Catalyst

Tier 3 / Stage IIIA 60-751 hp 2005

Tier 2 751+ hp 2006

Euro 4/5 On-Highway 2006 / 2009

EPA ‘07 On-Highway 2007

EPA ’07/’10 Pickup Truck 2007

EPA ‘10 On-Highway 2010

Tier 4 Interim /

Stage IIIB

174-751 hp 2011

75-173 hp 2012

Euro 6 On-Highway 2013

EPA ‘13 On-Highway 2013

EPA ‘13 Pickup Truck 2013

Tier 4 Final /

Stage IV

49-74 hp 2013

75-130 hp 2015

120-400 hp 2014 / 2015

400-751 hp 2014

Tier 4 Final 751+ hp 2015

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Recent Innovations

X12AEOS Class 7

Concept Vehicle

X15 Performance and

Efficiency Series

QuietConnect &

PowerConnect

Single Module

Aftertreatment System

QSK95 Generator

Sets

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The Markets We Serve

Heavy-duty Truck Medium-duty

Truck & Bus

Agriculture

Marine Mining Light-duty Automotive

& Recreational Vehicle

Construction Oil & Gas Fire & Emergency

Defense Power Generation Rail

This is not an exhaustive display of Cummins-powered applications

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Powering On-Highway Markets

▪ Meeting global emissions with fit-for-market solutions

▪ Offering power options for your duty cycle

• 49 – 605 hp range (36 – 451 kW)

• 206 – 2,050 ft-lb torque range (279 – 2,779 Nm)

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A portfolio of power solutions encompassing integrated technologies

across the powertrain, whether powered by diesel, natural gas, hybrid

or electric technologies.

Cummins

Integrated

Power

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2018 Natural Gas Product Line

Available in North America

Certified Near Zero Optional Low NOx

0.02g/bhp-hr

Certified Optional Low NOx

0.1g/bhp-hr

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October 2018

Public

NAFTA

Heavy-Duty Class 8 Group 2 Market Share

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Engine Manufacturers Class 8 Group 2 Market Share* (October 2018 YTD)

2017 Market Share2018 Market Share

October YTD

*Wards NAFTA Class 8 Group 2 Truck Shipments include diesel products with engines below 10L excluded

31%

19%

33%

14%

Cummins Navistar Volvo/Mack

Detroit Diesel PACCAR

Cummins Navistar Volvo/Mack

Detroit Diesel PACCAR

33%

35%

13%

17%2%

18.5%

32.1%

12.2%

34%

3.3%

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Public

October 2018

NAFTA

MidRange Class

6, 7 and 8 Group 1

Market Share

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Engine Manufacturers Class 6, 7 and 8 Group 1 Market

Share* (October YTD 2018)

2017 Market Share

2018 Market Share

October YTD

* Wards NA Medium Duty Market Share data (Class 6,7,8 Group 1 data) includes diesel products, ACT historic build data and Cummins

account teams data

Cummins

Navistar

Ford

MB/DD

Hino79%

9%

4%4% 4%

81.3%

9.3%

4.2%1.4% 3.9%

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Cummins Electrified Power

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Cummins Invests in Electrification

10,000 of the brightest engineering minds

Annual spend of $700M on powertrain innovation

Commitment of $500M over the next 3 years

on electric powertrain technology innovation

Added battery pack design capability

with acquisitions of Brammo and Johnson

Matthey Battery Systems

Advanced air

handling & fuel

system controls

for HD diesel

engines

High-efficiency

spark-ignited

technology

Proton

exchange

membrane and

solid oxide fuel

cell

technologies

Battery

technology

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Cummins Electrified Power Portfolio

HYBRID

Traction

BATT

Prime

MoverGen

Fuel

integrated powertrain system+ +

COMPONENTS

TractionBATTBATTBATT

FULL ELECTRIC

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AEOS Concept Truck

Battery Pack 140 kW hour

Peak Power 350 kW

Continuous 225 kW

Peak Torque 3400 Nm

Continuous 1850 Nm

30+ MPGe 100 miles Weight Neutral 1hour

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Quick Reference MUST HAVES

P/N 4081630 – ReCon

P/N 4971451 – EPA13

P/N 5410641 – EPA17Click HERE cummins.com/brochuresPUBLIC

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MART.CUMMINS.COM

What is it? Catalog and marketplace for Cummins marketing collateral.

What will it do? Provides a channel for marketing collateral requests.

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Connected Products

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Connected Diagnostics™Software application that analyzes Cummins engine fault data and sends information to the customer, including:

▪ Recommended customer action(s)

▪ Prioritized fault code information

▪ Suggested root cause

▪ Performance impact

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Connected Software Updates™Over-the-air solution that allows customers to remotely update software for Cummins powered electronic engines.

▪ Minimizes time & effort to keep engine software up-to-date

▪ Downtime reduced for required updates

▪ Uses equipment telematics system

Connected Advisor™Daily reports providing customers with insights into fleet health and recommended actions for maintenance and repair.

▪ Transforms engine faults to specific actionable recommendations

▪ Reduces notifications by 90% − decreasing information overload

▪ Estimates how long the equipment can continue to operate

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Q+A

323232

2019 Parts Programs and

Promotions

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ISX Growth Group

▪ ISX Growth group: EPA 2010 -

EPA 2013✓ Over 400,000 active engines

✓ Most engines are still in the Genuine

Channel

▪ ISX Legacy group: EPA07 - Older ✓ Over 200,000 active ISX engines

✓ Current rebate program continues for 2019

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Heavy Duty Overhaul Promotions Continue

Through 2019

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NEW Smart Series Overhaul Kits

For EPA 2010 & 2013 ISX15 Engines

Classic

Performance

Endurance

1

2

3

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The Classic Overhaul

Additions To The Classic for 2019

Saw Cut & Fracture Split

Connecting Rod Bearings

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Classic Kit – P/N Supersession

Current

Part NumberDirect Supersession

Classic Kit

Part Number

437617700 150mm 547306500

437617200 152mm 547306600

437617800 150mm 547306900

540598700 152mm 547307000

437617900 150mm 547307400

540598600 152mm 547307500

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Performance Overhaul

Contents of Classic Overhaul Kit

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Endurance Overhaul

Contents of Performance Overhaul Kit

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Overhaul kit package design

Insert Data Classification

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Connecting Rod Bearings

ISX Smart Series Overhaul Kits Offering

Fuel Connectors

Fuel Injectors

Connecting Rods

- CLASSIC -CURRENT - PERFORMANCE - - ENDURANCE -

Current Overhaul Kit

Cylinder Head

Lube Oil Pump

Water Pump

Coolant Thermostat

Connecting Rod Bearings

Cylinder Head

Coolant Thermostat

Connecting Rod Bearings

Lube Oil Pump

Water Pump

Coolant Thermostat

Pistons

Cylinder Liners

Main Bearings

Upper Eng Gasket Set

Oil Pan Gasket

Fuel and Lube Filter

Oil Bypass Valve

Current Overhaul Kit

Current Overhaul Kit

Current Overhaul Kit

January 2019 Q2 – Q4 2019Release Dates

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Technical Service Bulletins

• TSB 120067 for important information

regarding saw cut and fractured split

connecting rods and bearings

• Both Saw Cut and Fracture Split

connecting rod bearings will be

included (except Endurance)

• TSB 110277 for important information

regarding cylinder liner diameter.

• Additional part numbers for 152mm

cylinder liners

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152mm or 150 mm Liners - TSB110277▪ Per TSB 110277, for a window in 2010 all ISX/Q engines

were built with 152mm Cylinder Liners

• Multiple CPLs and platforms (CM871 and CM2250)

• Cummins is unable to identify specific CPLs or ESNs

▪ New engines / blocks and recon engines / blocks could all be affected

▪ No 100% way to confirm based on CPL or ESN

• i.e. Engine built in 2007 with 150mm liners could have had a block replacement in 2010 that used 152mm liners

▪ The only 100% accurate way to confirm the liner size is by measuring the liners in the block to prevent error

▪ Alerts to this TSB have been added to QSOL in a variety of places

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MidRange Overhaul Kits

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Coming in 2019!

▪ Release of marketing collateral to help

promote MidRange Overhaul Kits

▪ More information to be released on

parts.cummins.com

▪ Advertising campaign geared towards

MidRange Overhauls

▪ ISL Overhaul kit part numbers to be

superseded in Feb/March 2019

▪ 15% rebate provided to customers who buy an

ISL overhaul kit and corresponding head.

Where to Find Information.

On quickserve.cummins.com under the Products

Tab you’ll find a link to MidRange Overhaul Kit

Program

MidRange Overhaul Kits

Contents of the Basic Midrange Kits

▪ Pistons and Rings

▪ Cylinder Liner Kit (for non parent bore engines)

▪ Main Bearings

▪ Connecting Rod Bearings

▪ Upper Engine Gasket Kits

▪ Oil Pan Gasket

▪ 14% Cost savings when purchased as a kit vs. buying components individually

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6 for 5 Injector Program SpecialIncludes Heavy Duty and Midrange Injectors

▪How to receive the rebate:• Provide your local CRM Parts Manager, a

copy of end-user discount where your customer purchased 6 Recon non RX Celect Injectors and was only charged for 5

• Your local CRM Parts Manager will issue credit for the cost of (1) injector. The 5 Injectors may also be eligible for CUMPAS electronic order discounts

- Program excludes Celect RX injectors- This offer cannot be combined with our HD

Overhaul Package Programs

- Parts must be purchased from Cummins RM

Pa

rts P

rog

ram

s

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HPCR ReCon Injectors

A kit of 6 High-Pressure Common Rail

(HPCR) ReCon injectors that saves the

customer 30% vs buying injectors

individually.

For ISB5.9 and ISB6.7 engines for model

years 2002-2012.

Continuing in 2019!

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Let’s

Talk

About

DPFs.

ReCon DPFs are available for:

▪ EPA 10, EPA13 and EPA17

▪ ISX, ISB, ISL and ISC Engines

In 2018 we simplified our “good

core bad core” criteria and

replaced it with an “All Core” return

strategy.

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What Cummins Knows

▪ Genuine new DPFs are superior to will-fit DPFs.

▪ ReCon DPFs perform as good as genuine new DPFs.

▪ ReCon DPFs are superior to field cleanings.

▪ Less downtime than field cleaning

▪ Better reliability than field cleaning

▪ 100% ReCon inspection insures quality

▪ ReCon DPF comes with a warranty

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What are your customers saying to you about DPFs?

▪ Field cleanings vs. replacement?

▪ Will-fit new vs. ReCon DPF?

▪ What is the perception of a ReCon

DPF’s quality?

▪ Is there a “As Long As It Works” attitude?

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Newly Distributed From Cummins

Cummins is leveraging its world class re-seller distribution network investment to offer Major branded Allied Products

1. Competitive re-seller pricing on products

2. Local stocking of product to help you reduce your inventory and still respond to customer demands

3. Alternative vendor source on major industry products/brands

4. Most co-branded and officially Cummins endorsed.

5. Additional re-seller products will be added over the coming months

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Cummins Batteries - DistributionEvery™ Start. Ensured. • Cummins lead acid batteries are designed for many

applications giving you coverage in automotive, power

generation, marine and recreational.

➢ Access to the largest and most capable parts and

service network in North America with Cummins

- High level of service

- Extensive product offering for batteries and battery

related products including:

- Competitive pricing

- Ongoing training and sales support by our national

and local sales and operational teams.

➢ Extended free replacement warranty (18-36 months

depending on the part number)

➢Offers performance and reliability

➢ Additional types of batteries available (including AGM,

gel, and Nickel Cadmium batteries)

Battery Item #, pricing & availability via

CUMPAS

Contact your local Cummins Sales and

Service Parts Manager to help evaluate

your Cummins battery options.

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Power Service - Distribution

• Other products offered:➢ Diesel 911 (used to re-liquefy gelled fuel and de-ice

frozen fuel filters)

➢ Tank Hygiene and more

Pricing & availability via CUMPAS – use leading zero from the Power Service catalog to locate item(e.g., Part # 1128-04 from Power Service will be Cummins Part # 01128-04)

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Webasto - Distribution

• Cummins is a preferred distributor of

Webasto products with highly

competitive pricing

• Idle-reduction solutions:➢ Air heaters

➢ Precision bunk and engine temperature

management systems

➢ Coolant heaters

➢ Thermo King Tripac Kits

• Local Inventory access and availability

• Willing to work closely with you to tailor

stocking to your local customer needs

Webasto Item #, pricing & availability via CUMPAS

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2018 Growth Challenge Winners

Award # CUSTOMER_NAME State Attendee

1 CENTRAL TRUCK DIESEL INC WY Dallas Camp

2 Albuquerque Freightliner NM John Beyer

3 KENWORTH SALES COMPANY UT Paul Flores

4 MOTOR POWER EQUIPMENT CO MT Wayne Schneider

5 VELOCITY TRUCK CENTERS NV Mike Summerhays

6 SUMMIT TRUCK GROUP NM Todd Gohl

7 VELOCITY TRUCK CENTERS AZ Travis Mobley

8 TRANSPORT EQUIPMENT, INC. MT Nick Busby

9 WATSON TRUCK & SUPPLY NM Bruce Dew

10 PETERBILT OF WYOMING/ROCK WY Mike Culver

11 MCCANDLESS INTERNATIONAL NV Ken Pour

12 TRANSWEST TRUCKS CO Kyle Brophy

13 PETERBILT OF WYOMING WY Dennis Creel

14 Summit Truck Group - Farmington NM Jeff Nordstrum

15 RWC INTERNATIONAL LTD/P AZ Marc Cunningham

16 BOISE PETERBILT INC ID John Alderson

17 VELOCITY TRUCK CENTERS Sal Maldonado

18 Montana Peterbilt Steve Nelson

19 RUSH ENTERPRISES Robb Nixon

20 RUSH TRUCK CENTER - LUBBOCK Garrett Neumann55

▪ Congratulations to the 2018 winners!

▪ Over 600 lbs. of fish caught – Shipped and delivered

▪ 10 – “Sprint to the Finish” monthly challenge winners

▪ THANK YOU FOR YOUR BUSINESS

5656Insert Data Classification

2019 Dealer Sales Growth Program

▪ Program Dates: 11/1/2018 – 7/1/2019 (8 months)

▪ Travel Award Dates:

▪ October 1 – 4, 2019: Florida Key's Challenge (20)

▪ Sept. 29 – 4: Best-of-the-Best Bonus! (8)

▪ 5 Dealer Competition Groups 20 Dealer Winners!

▪ Sales Goals include:

▪ New, ReCon Components, ReCon Engines Goal

▪ Allied products Goal

▪ Monthly – Sprint to the Finish awards

▪ Best growth - Month / Month

▪ Pre-Requisites:

▪ Engine Certifications Met

▪ $100,000 yearly purchase minimum

▪ Parts Manager - Mobile App Downloaded

▪ RockyMt.GenuinePartsFirst.com

575757

Current Parts Highlights

and Important Reminders

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ECMB Repair Process

ECMB Background: (new TSB to be released)▪ ECMB are Electronic Control Modules used from 1990 to 1994

▪ Used on N14, M11, and L10 Engines with CELECT fuel systems (NOT CELECT PLUS)

+1

ECMB Problem: ▪ The last new ECMB was manufactured in 1994

▪ For 23 years ReCon ECMBs were the only customer solution

▪ Remanufacturing can no longer support demand

▪ 50% of core received cannot be remanufactured

▪ High supply and demand gap

ECMB Repair Solution: ▪ Cummins has developed a Factory Repair Process.

▪ ECMBs that are repairable will be fixed and sent back to the

customers

▪ If an ECMB is unrepairable, the unrepaired ECMB will be sent back

to customer or; if available, a ReCon ECMB will be offered.

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Early Catalyst Failure Leads To Field

Action of 500,000 Cummins Diesel Engines▪ In voluntary cooperation with the EPA and the

California Air Resources Board, Cummins will voluntarily repair over 500,000 heavy duty diesel engines installed in big trucks, P & D trucks, and some buses between 2010 and 2015. While the engines met all applicable emissions standards when new, the catalysts used to clean up tailpipe emissions failed earlier than expected

▪ The recall affect about 60 engine families found in a wide range of vehicles, from big-rigs, to larger pickup trucks and some buses.

Source:cleantechnica.com – August 6, 2018

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Campaign/TRP Supply Chain Factors

1. There are more than 200 unique SCR item

numbers installed over these 500K engines.

2. Quantities forecast for these 200+ numbers are

highly variable.

3. No SCRs will be sent next day air freight under

this campaign - Leadtime (LT = 1 day)

4. Limited local branch stocking due to SCR size

(2-4 /pallet) – higher running SCR focus

5. Regional restocking Leadtime (LT) = 1-2 days

6. Replenishment of less common SCR will ship

outside the Western Zone and will carry LT 3-5

day.

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Your Actions Make a Difference

1. It’s critical that Parts & Service departments work with local customers to proactively schedule these non-mission disabling repairs.

2. It is highly recommended that units be scheduled at least 1 week in advance so research on the SCR item needed can be conducted (note: not all trucks covered by the campaign/TRP will need to have a replacement – The only sure way to know if a truck needs a replacement is to get the item number from the SCR on the vehicle)

3. Unscheduled evaluations risk the removal of the SCR only to find out that the required SCR is not locally available and will take 1-5 working days to be procured.

4. We urge your assistance to minimize the impact to our mutual customers. Both customer downtime and your warranty reimbursement are dependent on your expertise.

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SCR Field Action Reminders

1. Preliminary ESN Campaign/TRP research and SCR staging is essential to minimizing customer downtime.

2. Campaigns are performed proactively

• Check for any Campaigns when Engine number is added in Quick Serve

3. TRPs are triggered repairs and should only be performed if specific conditions are met

• The Customer complaint must meet the TRP guidelines

4. Campaign/TRP recognition and details are critical – Know what the Field action says

5. These field actions provides for retroactive coverage of repairs, including customer billable repairs, completed by Cummins authorized repair locations prior to the release date of this field action.

• All service providers filing claims for retroactive repairs should reference Warranty Memo M1825 for instructions.

6. Both customer downtime and your warranty reimbursement are dependent on your execution and expertise. . . Build a Plan . . . Apply the Plan . . . Execute the Plan

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Example - Field Event Qualifiers/Actions

Campaigns – Reference the official Campaign publication for complete

Instructions

1. C2052 - All ISX12 CM2250 and ISX15 CM2250 ENGINES RATED AT 525-600HP EMISSION

RECALL CAMPAIGN

• For ISX12 CM2250 and ISX15 CM2250 (Model Year 2010 thru 2012 Product) the SCR Part

Number must be compared with Attachment B. Any SCR Part Number found in the Affected Part

Number Column should be replaced. If the SCR Part Number is not found in the Affected Part

Number Column, file only the appropriate Admin Time, and Campaign Check (SRT 17-902).

2. C2053 - ISX12 CM2350 Emissions Recall Campaign

• For ISX12 CM2350 (Model Year 2013 Product) engines only, the SCR catalyst must be inspected

per TSB130099 prior to performing the campaign. If the SCR catalyst does not have the dimples

shown in the TSB, install a new SCR catalyst. If the SCR catalyst has the dimples shown in the

TSB, the SCR catalyst doesnot need to be replaced. File only the ADMIN Time (00-90x) and the

Campaign Check (17-902) to close the eligibility for the subject ESN.

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Example - Field Event Qualifiers/Actions

TRP – Reference the official TRP publication for complete Instructions

1. T2035 - ISX15 CM2250 SCR Replacement TRP for Fault Codes 3151 or 3582

In order to qualify for repair under this field action, an engine:

• will be covered Regardless of coverage status, and

• must show an OPEN status for this field action on QuickServe® Online, and

• must have an active count of fault code 3151 (SCR Catalyst System Missing) or 3582 (SCR Conversion Efficiency), or more than one inactive count within the last 250 engine operating hours, and

• must be less than 435,000 miles.

2. T2084 - ISB and ISL CM2350 SCR Replacement TRP

• For ISB and ISL CM2350 (Model Year 2013 thru 2014 Product) the SCR Part Number must be compared with Attachment B. Any SCR Part Number found in the Affected Part Number Column should be replaced. If the SCR Part Number is not found in the Affected Part Number Column, the engine is not eligible for this action.

NOTE: New SCRs delete the NH3 Sensor and move from a three (3) sensor to a NEW two (2) sensor configuration. This action provides coverage for a new wire harness. The installation of a new wire harness will require an ECM calibration update. Please refer to Attachment C for a table of ECM base codes and CPLs for your consideration

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Campaign C2062

▪ISX15/X15 CM2350 X101/X114B Fuel Line Safety Campaign - Impacts 34K Engines

▪ In order to qualify for repair under this field action, an engine:• will be covered Regardless of coverage status, and

• must show as OPEN on QuickServe® Online for this field action.

▪ Note : The ESN listings are attached for reference.

▪This Safety Campaign provides coverage and repair instructions for these engines, using anew steel fuel line kit part number 5473412 & 5579015.

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VG Turbos and

VG Actuators

Warranty Change

▪ Effective for VG turbo and VG actuator sales after October 1st 2018

• All turbos and actuator failures must be diagnosed on-engine

by an authorized or certified Cummins Service Provider.

• Suspected Over-the-counter exchanges will not receive

warranty coverage.

▪ Why:

• Reduce “No Trouble Found” NTF warranty returns.

• Provide customers with the right repair.

- Certified Channel has better diagnostic abilities and access to

published troubleshooting documents

• Keep customers in the Genuine repair channel.

6767

2019 Annual Pricing

And

Dealer Policies Review

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2019 Cummins Pricing Change Summary

▪ On 02 January 2019 new pricing for Cummins NewReCon service parts,

ReCon engines and Cummins Power Generation parts is effective.

▪ North American Prices for Cummins New & ReCon Parts/Engines will increase

an average of 4.6%.

▪ Cummins Power Generation (Onan) Parts pricing will see a 3.2% increase

▪ There are 2 primary drivers for price increases this year:

– Supplier cost increases: driven by general inflation, raw material costs, transportation, and tariffs

– Product enhancements: retroactively applying newer technology and design improvements to

previously released service parts

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2019 Dealer Policies

▪Electronic Order Discount –Discount applied immediately on invoice

–Orders must be placed via CUMPAS

–All order types are included (Stock, Emergency, Warranty)

–No minimum dollar amount required

–ReCon engines not included

–5% discount off dealer price on all electronic orders for all ISX, and 2007 and newer Midrange componentsD

ea

ler

Po

licie

s

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2019 Dealer Prepaid Freight Policy

▪Free Freight Program (no change)• Free freight from CRM’s primary support location

on Cummins New and ReCon parts for orders $1,750 or more (Excluding core charges)

• All other shipping criteria policies still apply

• Orders less than $1,750 and ReCon engines carry freight expense

• ReCon engines not included

De

ale

r P

olic

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2019 Dealer Emergency Freight Policy▪ Emergency Order Freight (no change)

• Within Warranty

- Free freight when order is identified as “warranty order” at the time the order is placed on CUMPAS

- Requires – ESN and Control Number when ordering via CUMPAS

• Out of Warranty

- Shipments from Cummins Memphis Distribution Center (MDC) will carry a premium freight charge of 10% of the Part(s) value (Dealer Net), with a minimum charge of $30 and a maximum charge of $650 per line item.

• All other shipping policies still apply

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2019 Dealer Immediate Ship Program▪ The Immediate Ship Program applies to the following ReCon

products:

• ReCon Engines

• ReCon Long Blocks

• ReCon Short Blocks

• New Blocks

• New Block Kits

▪ Order Cut-off Time

• Customer Down Immediate Ship orders must be received at the MDC by 3:00 p.m. CST to be shipped the same day. Customer Down Orders received after 3:00 p.m. will be shipped the following day.

▪ Shipment via CRM designated LTL Carrier

▪ Shipping Price

Policy 2018

Immediate Shipment Program

-Midrange Engines, Long Blocks, Short Blocks,

Bare Blocks , & Block kits

$400

-HD Engines $600

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ale

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2019 Dealer Return Policy

Criteria Policy

Allowable Frequency of Returns Unlimited

Aggregate Amount for Returns 5% of previous year’s purchases

Offsetting Order None required

Restocking Fee 10% of current dealer pricing

Item Return threshold No return of items with an extended $ amount of under $5

Return Freight Dealer pays

Superseded/Obsolete Parts Allowed

Acceptance Criteria Parts should be in saleable condition and meet Cummins resale

guidelines

*Return Eligibility (the following

parts not allowed for return):

Chemicals, Engines (long Blocks), ECMs, literature, catalogs,

manuals, open/resealed kits/parts, paint, service tools/products,

software, installed (used) parts, incomplete assemblies or kits,

damaged parts, unidentified parts, made to order/customized

items. Rubber items (belts, o ‘rings, etc.) that are over 2 years old

(pack date required for return). Any parts prepped or installed are

not acceptable.

Other Criteria Parts should be returned to the location where the parts where

originally purchased

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ReviewPolicy 2019

Emergency Premium Rate 10%

Emergency Min / Order & Max / Line $30 / $650

Economy Premium Rate 8%

Economy Min / Order & Max / Line $20 / $500

Immediate Shipment Program

-Midrange Engines, Long Blocks, Short Blocks, Bare

Blocks , & Block kits

$400

-HD Engines $600

De

ale

r P

olic

ies

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Q+A

7676

Channel Management Topics & Support

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Redefinin

g F

ield

Support

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Channel Managers

Jeremy Flesch

jeremy.flesch@cummins.com

303-253-0851

MT, ND, ID, WY, CO

Jordan Chavez

jordan.e.chavez@cummins.com

385-279-0219

NV, AZ, NM, UT

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Cumpas 2.0 - Enhancements

▪ Allied products added – Batteries, Webasto, Power Service

▪ Orders over 100 lines, it is on the list still but no timeframe for this change as of now.

▪ Auto-Save feature for orders to help with possible timeouts. That order would be saved in your draft orders and you could easily go back to where you were - Q2.

▪ Order tracking improvements - Q2

▪ Real invoices available on Cumpas

• Current use "Cummins.distributor.com" possible - Q2/3

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Cumpas 2.0 - Features▪ Reports

• Part Price Extract

• Backorder log

- Parts escalation – Local Branch support

▪ Training Reference aids – References

▪ Order Status – Click Oder ID to refresh

▪ Update Contact info

• Email

• Phone

▪ Order history search capability

• Click to Open Additional Filters

• Partial part number or PO search

• Click “Search” (enter does not pull the search on the filter)

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81

Cumpas 2.0 - Features

▪ Value of Parts Template

▪ Upload parts consistently used for

▪ Service Procedures (i.e. - EGR cooler)

▪ Stock Orders

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▪ Parts template

▪ Download Requirements

▪ Save as CSV file

▪ Column “A” Part # only

▪ Column “B” Quantity only

Dealer Reviews

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Redefinin

g F

ield

Support

83

Dealer Certification Reviews▪ What we do when we visit

▪ WWSPS, QSOL and ProMotion users and contacts are updated

▪ PITT audit Random Tool review of 10-15 tools

▪ Communicate new products or system updates – CUMPAS 2.0, Guidanz, etc.

▪ Warranty claim review

▪ How long does it take?

▪ About 2.5 – 3 hours between the Parts and Service management

▪ What resources are needed to be allocated?

▪ Will need staff to pull random list of tools –30 min approximately

▪ Time with each part and service manager –1.5 hour

Intellectual Property Overview

85

What is a Patent?

A patent is an exclusive right granted for an invention, which is a product or a process that provides, in general, a

new way of doing something, or offers a new technical solution to a problem. To get a patent, technical information

about the invention must be disclosed to the public in a patent application.

What is a Copyright?

Copyright (or author’s right) is a legal term used to describe the rights that creators have over their literary and

artistic works. Works covered by copyright range from books, music, paintings, sculpture, and films, to computer

programs, databases, advertisements, maps, and technical drawings.

What is a Trademark?

A trademark is a sign capable of distinguishing the goods or services of one enterprise from those of other

enterprises. Trademarks are protected by intellectual property rights.

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Current Approach to Protect our IP

▪ Register trademarks globally

▪ CUMMINS

▪ HOLSET

▪ STAMFORD

▪ FLEETGUARD

▪ Cummins recently registered the “Cummins Red” on engines in the United States

▪ Globally monitor third party applications and oppose those that may be confusingly similar to our brands.

▪ Record with several customs offices to enable Cummins to review suspect shipments at the border.

▪ Restrict use of our brand by third parties.

▪ Ensure consistent use of our brand.

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Current Approach to Protect our IP

▪ Cummins addresses trademark infringements globally, including:

▪ On websites

▪ On signage

▪ In publications and literature

▪ In stores

▪ In domain name URLs

▪ Cummins enforces against counterfeit activity

▪ Legal determines the best course of action, including investigations, raids, cease and desist letters, or court action.

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▪ What to look for:

▪ False association / partnership with Cummins

▪ Incorrect logo usage

▪ How does this affect you?

▪ Lost revenue

▪ Misrepresentation

▪ If you see it report it – Signs, Cummins logo used by non-Cummins Authorized dealers on Business cards,

banners, vehicle wraps etc.

▪ Who to report concerns to:

▪ Cummins Channel Manager -

▪ Jeremy Flesch - 303-253-0821

▪ Jordan Chavez - 385-279-0219

▪ Cummins Local Branch management

▪ Cummins Territory Representative

▪ Dealer use of logos

▪ Brand Standards for Dealers -

▪ Engines, Parts and Power Generation Products (PDF)

▪ How to get to it – Cummins RM site, Channel Manager

Reporting Suspect Activity

89

Thank you

Questions ??

9090

91

APPENDIX

92

Idaho

▪ Bryan Austin

• Territory Account Executive

• bryan.austin@cummins.com

• Phone (208) 982-2916

PUBLIC

93

Arizona & New Mexico

▪ Kristopher Young

• Dealer Account Executive

• kristopher.young@cummins.com

• Phone (480) 442-6781

▪ TBD

• Fleet Account Executive

• E-MAIL@cummins.com

• Phone (XXX) XXX-XXXX

PUBLIC

94

Colorado & S-Wyoming

▪ Jeff Garberding

• Dealer Account Executive

• jeff.Garberding@cummins.com

• Phone (720) 212-9471

▪ Annette Vettraino

• Fleet Account Executive

• annette.vettraino@cummins.com

• Phone (720) 325-4735

PUBLIC

95

Nevada, S-Utah & NE-Arizona

▪ Nic Dobson

• Territory Account Executive

• nic.dobson@cummins.com

• Phone (702) 219-7518

PUBLIC

96

Utah

▪ Ron Dimmick

• Dealer Account Executive

• ronald.dimmick@cummins.com

• Phone (385) 214-5452

▪ Rodney Nehring

• Fleet Account Executive

• rodney.nehring@cummins.com

• Phone (801) 380-9176

PUBLIC