Did Ford Really Used To Own Cummins? The Companies' Close Relationship Explained
A quick look online will reveal an abundance of car forums with Ford drivers wondering if the Ford Motor Company really did own Cummins Engine Company, which is based in Indiana — a rumor that's been floating around for years. It's tough to find the concrete answer but news archives reveal that Ford actually did own a piece of Cummins at one point — it just didn't last that long.
Between the 1990s and 2015, Ford had a few trucks with Cummins engines, including the F650 and F750 (some of the biggest pickups you can get). You won't see Ford vehicles with Cummins engines anymore, but the earlier models with Cummins as the standard definitely have led Ford enthusiasts down a rabbit hole. The New York Times archives confirm that the Cummins Engine Company sold a 27% stake to Tenneco Inc, Kubota Ltd., and — of course — the Ford Motor Company in 1990. Ford ended up owning 10.8% of Cummins after paying $62.50 per share (at a 22% premium), setting it back $100 million, and seemed quite confident with the engine company at the time.
At the time of the transaction, Cummins' chief executive Henry B. Schacht said that the company was "very excited" about the new partnership, hoping to bring aboard relationships that would "complement our existing sales." So what happened between Ford and Cummins that ended the partnership so soon?
The reason that Ford ended its partnership with Cummins
Another New York Times article shows that Ford and Cummins parted ways completely by 1997, just seven years after Ford purchased 10.8% of the company. The financial report stated that the Cummins Engine Company had repurchased 1.3 million of its common shares from the Ford Motor Company and that Ford's VP, Kenneth R. Dabrowski, was resigning from Cummins' board. This was apparently part of the plan following the 1990 investment — not because of any sort of disagreement or internal issue.
It was likely part of Ford's plan to transition to increased in-house production; Ford started making its own engines as a way to cut costs, no longer using Cummins engines in its larger vehicles. Ford's diesel engine, Powerstroke, is often compared to Cummins engines and truck drivers generally agree that Cummins is superior due to its reliability and long-time trust of the name. However, the Powerstroke produces slightly more torque and more horsepower.