Cummins Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

INVESTMENTS IN EQUITY INVESTEES (Tables)

INVESTMENTS IN EQUITY INVESTEES (Tables)

12 Months Ended

Dec. 31, 2019

Equity Method Investments and Joint Ventures [Abstract]

Summary of investments in and advances to equity investees and our ownership percentage

Investments and advances related to equity method investees and our ownership percentages were as follows:



		December 31,
Dollars in millions	Ownership %	2019		2018
Komatsu alliances	20-50%	$	267	$	238
Beijing Foton Cummins Engine Co., Ltd.	50%	193		203
Dongfeng Cummins Engine Company, Ltd.	50%	149		160
Chongqing Cummins Engine Company, Ltd.	50%	110		102
Cummins-Scania XPI Manufacturing, LLC	50%	96		101
Tata Cummins, Ltd.	50%	60		58
Other	Various	362		360
Investments and advances related to equity method investees		$	1,237	$	1,222

Equity, royalty and interest income from investees

Equity, royalty and interest income from investees, net of applicable taxes, was as follows:



	Years ended December 31,
In millions	2019		2018		2017
Manufacturing entities
Beijing Foton Cummins Engine Co., Ltd.	$	60	$	72	$	94
Dongfeng Cummins Engine Company, Ltd.	52		58		73
Chongqing Cummins Engine Company, Ltd.	41		51		41
All other manufacturers	88		129		71			⁽¹⁾
Distribution entities
Komatsu Cummins Chile, Ltda.	28		26		30
All other distributors	2		—		(1		)
Cummins share of net income	271		336		308
Royalty and interest income	59		58		49
Equity, royalty and interest income from investees	$	330	$	394	$	357

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⁽¹⁾Tax legislation passed in December 2017 decreased our equity earnings at certain equity investees by $39 million due to withholding tax adjustments on foreign earnings and remeasurement of deferred taxes. See Note 5, "INCOME TAXES," to our Consolidated Financial Statements for additional information.

Summary of financial information for equity investees

Summary financial information for our equity investees was as follows:



	For the years ended and at December 31,
In millions	2019			2018			2017
Net sales	$	7,068		$	7,352		$	7,050
Gross margin	1,274			1,373			1,422
Net income	566			647			680

Cummins share of net income	$	271		$	336		$	308
Royalty and interest income	59			58			49
Total equity, royalty and interest from investees	$	330		$	394		$	357

Current assets	$	3,282		$	3,401
Non-current assets	1,622			1,449
Current liabilities	(2,654		)	(2,669		)
Non-current liabilities	(326		)	(218		)
Net assets	$	1,924		$	1,963

Cummins share of net assets	$	1,159		$	1,144