Trade Agreements Offer Benefits for U.S. Employers and Employees

Global trade brings benefits to American workers and consumers.

The following op-ed was authored by Tom Linebarger, Chairman and CEO of Cummins Inc. and Chair of the Business Roundtable International Engagement Committee; and Mike Bertsche, the President & CEO of Camcraft.

After years of negotiations, the 12-nation trade deal known as the Trans-Pacific Partnership is facing its toughest challenge yet: election-year politics.

The fact is, TPP and U.S. trade agreements overall, offer tremendous benefits for U.S. employers and employees alike. Consider a few numbers: trade-related jobs grew 3.1 times faster than overall employment between 2004 and 2014, and nearly half of all U.S. goods exports to the world in 2014 went to just the 20 countries that the United States has free trade agreements with.

Unfortunately, the facts are being distorted by rhetoric on the presidential campaign trail, with candidates alleging that U.S. trade agreements like NAFTA have suppressed wages and cost American jobs. In fact, U.S. trade with NAFTA partners Canada and Mexico supports nearly 14 million U.S. jobs, according to a U.S. Chamber of Commerce study.

Moreover, contrary to the campaign rhetoric, U.S. jobs tied to trade also pay more than other jobs. According to a report by the Commerce Department, manufacturing jobs pay 18% more on average when tied to exports. The report also notes that foreign tariffs — like those TPP will eliminate — reduce the earnings of U.S. workers by as much as 12%.

We have to put politics aside and recognize TPP as an opportunity to support U.S. economic growth and high-quality American jobs.

The agreement will create opportunities to sell more U.S. goods and services to 11 Asia-Pacific countries. This region is already critical to America’s exports: TPP nations accounted for some 45% of all U.S. exported goods in 2014.

All told, TPP will eliminate more than 18,000 foreign tariffs on U.S. goods, opening markets to U.S. export growth. And because five TPP countries currently lack trade agreements with the United States, the deal will also open entirely new markets for American firms.

Just as important, the trade pact will put in place strong, enforceable rules for fair trade that actually improve on NAFTA and other past U.S. trade agreements. TPP is the first modern trade agreement that addresses the realities of our interconnected global marketplace. For example, it will establish intellectual property protections for American companies and inventors and raise foreign labor and environmental standards. It also will discourage other countries from using government procurement and state-owned companies to put American firms and workers at a disadvantage.

In short, TPP will open access to millions of customers for U.S. goods and services while boosting foreign investment throughout the United States. The resulting U.S. exports and international investment here will expand U.S. economic growth and jobs.

Watch Now: How The TPP Will Benefit The U.S. Economy

 

To understand how trade supports companies of all sizes, consider the relationship between our two companies. Headquartered in Columbus, Indiana, Cummins’ 25,000 U.S. employees design, manufacture and distribute engines and related products that are powered by diesel and natural gas. In 2014, we exported approximately $3 billion in U.S.-made products.

These foreign sales don’t just benefit Cummins and its U.S. employees; they also help our 2,500 domestic suppliers, such as Camcraft. Camcraft is a small company based in Illinois. Its 330 employees manufacture high-precision components used in Cummins engines.

As leaders of manufacturing companies large and small, we know how important trade and U.S. trade agreements like TPP are to the success of our companies and to businesses and farms across the United States.

The relationship between our two companies shows how exports ripple through the U.S. economy in a supply chain generating billions of dollars in revenue and thousands of jobs.

Previous U.S. trade pacts offer evidence: America’s current trade partners purchase 13 times as many U.S. goods per capita than countries with which we don’t have trade agreements. Those purchases support U.S. jobs.

When Congress takes up TPP, members should look beyond the divisive campaign rhetoric and seize the opportunity to support growth and jobs in their home states. By approving TPP this year, Congress will enable American workers, businesses and farmers to sell more in international markets — reaping the benefits before our foreign competitors do.

Editor's Note: The op-ed above also appeared in the following publications

The Indianapolis StarTrans-Pacific Partnership is good for U.S. workers

The New York Daily NewsTPP is good for American manufacturers and the people they employ

The Post and Courier - Election Rhetoric Sells Trade Agreements Short

Tom Linebarger Chairman and CEO

Tom Linebarger

Tom Linebarger became Chairman and CEO of Cummins Inc., the largest independent maker of diesel engines and related products in the world, on January 1, 2012.  Prior to becoming Chairman and CEO, he served as President and COO from 2008 to 2011, Executive Vice President and President, Power Generation Business from 2003 to 2008, Vice President and Chief Financial Officer from 2000 to 2003, and Vice President, Supply Chain Management from 1998 to 2000.

5 Ways Cummins Works to Protect the Earth

Cummins employees conduct a tour of the Jamestown Engine Plant in Jamestown, New York (U.S.A.) featuring its new LED lighting system. The plant has taken many steps to reduce the energy it uses and is participating in the Department of Energy’s Better Buildings’ Challenge.
Cummins employees conduct a tour of the Jamestown Engine Plant in Jamestown, New York (U.S.A.), featuring its new LED lighting system. The plant has taken many steps to reduce the energy it uses and is participating in the Department of Energy’s Better Buildings’ Challenge.

The world will celebrate Earth Day this weekend (April 22, 2018). Here are five ways Cummins works to protect the earth as part of its mission to build a more prosperous world:

Jamestown Solar Array (reduced size)
A Cummins employee checks the solar array on top of the Jamestown Engine Plant in Jamestown, New York (U.S.A.).

1.    SAVE ENERGY AND REDUCE GREENHOUSE GASES (GHGs)

Many Cummins facilities have been undergoing upgrades to improve energy conservation and by extension reduce GHGs. Over the past decade, for example, the Jamestown Engine Plant has installed energy efficient lighting, improved heating and air conditioning, a better building envelope, a solar array and more. Cummins has also established a group of employees across the company who serve as Environmental Champions, looking for ways to reduce the energy Cummins’ facilities use and other environmental advances.
 

India Dam full of water that's part of Modern Village program

Cummins’ Model Village program in India built this dam to help village residents near one of its facilities better manage their water resources.

2.    CONSERVE WATER

Cummins has made significant progress in reducing the water it uses, lowering the amount in real terms from 972 million gallons in 2014 to 934 million gallons in 2016. The company has fixed leaks, changed processes and invested in equipment that uses less water. In addition, Cummins is pushing to establish “Water Neutrality” at 15 sites where the company is replacing the water it uses by supporting conservation efforts in local communities or developing additional sources of water. 

 

Cummins X15 Engine

Full production started in 2017 on the Cummins X15 engine, one of the cleanest, most efficient diesel engines the company has ever made.

3.    BUILD MORE EFFICIENT PRODUCTS, WORK WITH CUSTOMERS TO IMPROVE OUR PRODUCTS IN USE.


Cummins believes there is no single answer to the world’s energy needs.  That's why the company produces a broad portfolio of products so customers can choose what’s best for their particular needs. In just the past year, the company started full production on the X15, one of the cleanest, most efficient diesel engines the company has ever made. Cummins is a partner in a joint venture that in 2017 launched a natural gas engine for buses that emits emissions 90 percent below EPA standards for a key contributor to smog. Cummins has also worked with customers using its products to complete more than 200 fuel economy projects in the field since 2014.

 

AEOS Unveil Small Photo
Employees and visitors gather in the summer of 2017 for the unveiling of AEOS, a Class 7, all-electric concept truck the company is using to study electrification.

4.    PURSUE LOW-CARBON TECHNOLOGIES

Cummins started its Electrified Power segment in 2018, pledging to deliver an all-electric powertrain for the urban bus market by 2019. But that’s not the only way Cummins is pursuing low-carbon technologies. In 2017, the company announced a partnership with Microsoft to explore the use of natural gas powered fuel cells to power data centers. And the company has been looking for ways to make its diesel engines increasingly more fuel efficient while delivering lower emissions, saving customers money while improving the environment.

 

Cummins wind farm expansion
Cummins officials meet with officials from the Meadow Lake Wind Farm in northwest Indiana to learn more about wind energy.

5.    ENCOURAGE THE PRODUCTION OF RENEWABLE ENERGY

Cummins entered into an agreement in 2017 to help a northwest Indiana (U.S.A.) wind farm expand. The Virtual Power Purchase Agreement ensures a viable market for the wind farm’s energy. When fully operational in early 2019, the expansion will generate renewable electricity equivalent to the amount of power Cummins uses at all of its Indiana facilities. The company also has solar arrays at a number of plants around the world and last year Cummins entered into the partnership mentioned earlier with Microsoft to study the potential for powering data centers with natural gas powered fuel cells. 
 

 

blair claflin director of sustainability communications

Blair Claflin

Blair Claflin is the Director of Sustainability Communications for Cummins Inc. Blair joined the Company in 2008 as the Diversity Communications Director. Blair comes from a newspaper background. He worked previously for the Indianapolis Star (2002-2008) and for the Des Moines Register (1997-2002) prior to that. blair.claflin@cummins.com

Our Journey: Technical Women’s Initiative

Cummins Womens Technical Initiative
Technical women from around the world gathered in Columbus, Indiana for the Cummins Women in Technology Conference.

“Can you do a project to look at barriers and enablers to have more women in the engineering function?” That was the question posed to Anne McLaren and other Cummins engineers dedicated to improving the representation of technical women at Cummins.

That project led to the Cummins Technical Women’s Initiative, which celebrated its tenth anniversary in 2017. The goals of this initiative are to attract, develop, and retain technical women at all levels and in all regions, and to have technical women equally represented across all levels of leadership.

“The Technical Women’s Initiative was a path for me to shift and work actively to improve what I can,” explained Ana Paula Marimoto.

Last week, McLaren and Marimoto joined technical women from around the world in Columbus, Indiana for the Cummins Women in Technology Conference. Sessions ranged from updates on technical topics such as electrification to professional development opportunities to a panel discussion with several members of the Cummins Leadership Team.

“My hope is that I'm able to affect the engineering profession and make it a more inclusive place for everyone, no matter what your demographic happens to be, or how you identify,” said Karen Ramsey-Idem.

Judging by the atmosphere at the conference, Ramsey-Idem and others leading this work at the Company are well on their way.
 

katie zarich author bio photo

Katie Zarich

Katie Zarich is Manager of External Communications for Cummins Inc. She joined the Company in 2015 after more than a decade working in government and the nonprofit sector. katie.zarich@cummins.com

Cummins Electrification Leader Says Broad Power Portfolio is Best for Customers

Executive Director of Electrified Power Julie Furber speaks at the Green Truck Summit in Indianapolis, Indiana (U.S.A.).
Executive Director of Electrified Power Julie Furber speaks at the Green Truck Summit in Indianapolis, Indiana (U.S.A.).

The leader of Cummins’ Electrified Power business said this week customers are best served by a company offering a broad portfolio of products so they can choose the power solution that works best for them.

“Different solutions meet different needs,” Julie Furber told the Green Truck Summit in Indianapolis, Indiana (U.S.A.). “…We believe (offering) a variety of solutions is the way to go.”

The summit was held in conjunction with the Work Truck Show, the largest gathering of its kind in North America. Work trucks are commercial vehicles designed for specific jobs such as construction, delivery, tow trucks, snow plows and more. The summit puts a special focus on environmental issues related to these vehicles such as alternative power technologies and fuels.

Furber, executive director of Cummins Electrified Power segment, said the company’s goal is to be the industry leader in electrified power in every market Cummins’ serves. But she also said with advances in clean diesel, Cummins expects diesel engines to remain an important power source for years to come, particularly in long-haul trucking.

Natural gas engines, especially those using renewable natural gas, can be incredibly clean and efficient. Hybrid engines offer still additional benefits in the right situation and Furber said Cummins is also exploring possibilities such as fuel cell technology to power data centers.

Providing customers with the “right technology at the right time,” is key, Furber said.

She spoke at a panel titled “It’s a New Kind of Truck – It’s Not Your Father’s Work Truck Anymore,” devoted to electrification. She sees electrified power in the work truck industry evolving in three distinct phases:

*An introductory phase where people become familiar with the technology.
*A phase where the technology is increasingly adopted, especially in urban areas where the necessary infrastructure is expected to first develop.
*And finally a phase where electrified power becomes fully viable economically, perhaps following a major technology break through affecting price.

“There will be lots of changes,” Furber said, predicting a path for electrification not unlike the cell phone, which went from something of a curiosity in the 1970s and early 1980s to ubiquitous today, with an established infrastructure around the world.

Cummins has pledged to have an all-electric powertrain on the market for buses by 2019. Furber says the company has several advantages when it comes to succeeding in the field.

Cummins has been working with electrification for decades in areas such as hybrid engines. It also has the size and service network to provide customers with the reliability they need to succeed.

Furber says electrification will have to be a proven technology with established service networks before it sees widespread adoption in the work truck market where customers depend on their vehicles for their livelihood.

While the decision to purchase an automobile can be influenced by the heart, she says purchasing a work truck is almost entirely an exercise of the head.
 

blair claflin director of sustainability communications

Blair Claflin

Blair Claflin is the Director of Sustainability Communications for Cummins Inc. Blair joined the Company in 2008 as the Diversity Communications Director. Blair comes from a newspaper background. He worked previously for the Indianapolis Star (2002-2008) and for the Des Moines Register (1997-2002) prior to that. blair.claflin@cummins.com

Five ways Cummins worked to improve the environment in 2017

Cummins leaders meet with EDP Renewables officials at Meadow Lake Farm in northwest Indiana earlier in 2017.
Cummins leaders meet with EDP Renewables officials at Meadow Lake Farm in northwest Indiana earlier in 2017.

2nd in a series

In 2017, Cummins took a number of steps outside product development to reduce its carbon footprint and improve the environment. Here’s a quick look at five key ones:

 

1. PROMOTING LOW-CARBON ENERGY

In August of 2017, Cummins announced it had entered into an agreement enabling a northwest Indiana (U.S.A.) wind farm to expand so it can produce enough low-carbon power for the grid to offset the amount of electricity the company uses at its Indiana facilities. Under its 15-year Virtual Power Purchase Agreement (VPPA) with EDP Renewables North America, Cummins guarantees a certain fixed price for the energy the wind farm expansion sells to the grid. The company, in turn, receives renewable energy certificates it can use in calculating Cummins' environmental impact.


 

Cummins water logo
Cummins water strategy has three basic components.

2. ESTABLISHING A NEW WATER GOAL

Cummins used World Water Day, March 22, 2017, to announce a new 2020 water reduction goal of 50 percent, having cut water use 42 percent, adjusted by labor hours, since 2010. In 2016, the company’s absolute water use fell from 947 million gallons across the company to 934 million gallons. Just three years ago (2014) the company used 972 million gallons. The savings have come from multiple projects at Cummins facilities across the globe.

 

Soot free bus partnership signing ceremony
Antonio Leitao (center), Vice President of the Europe Area Business Organization at Cummins, joins other executives in Paris, France, signing the pledge to help target cities improve their air quality.

3. MAKING CLEAN DIESEL ENGINES AVAILABLE AROUND THE WORLD

In September 2017, Cummins joined three other global manufacturers pledging to help 20 large cities around the world address air quality and climate change. The companies will make available sales and service for buses and bus engines with low emissions technology no later than 2018 in the target cities. Nearly all of the cities benefitting from the partnership are in countries that do not have rigorous emissions regulations. Other companies making the pledge include Volvo Buses, Scania Buses and Coaches, and BYD Electric Buses.

 

Gateway panel
A potential supplier makes a presentation to Cummins’ leaders in the United Kingdom in March, 2017, as part of the Environmental Gateway project.

4. DEVELOPING NEW IDEAS TO REDUCE OUR CARBON FOOTPRINT

As part of the Environmental Gateway project, Cummins leaders in the U.K. on March 2, 2017, heard 28 finalists pitch their best ideas for shrinking the company’s carbon footprint and meeting Cummins’ environmental goals. About 100 suppliers and others submitted ideas as part of the initiative, which was loosely modeled on television shows where entrepreneurs pitch their best ideas to a panel of investors. Sponsors say the Gateway was a great way to spur innovation. Twelve winning ideas were selected and are now being tested in the U.K. The initiative has also spread to other locations around Cummins including the United States.

 

Jamestown Engine Plant electrician Fred Gable inspects the solar panel connections at
Jamestown Engine Plant electrician Fred Gable inspects the solar panel connections at Cummins’ solar array at Jamestown, New York (U.S.A.). The plant is one of the locations where the company is adding renewables to its energy mix.
 

5. IMPLEMENTING PROGRAMS TO SAVE ENERGY AT CUMMINS FACILITIES

Cummins’ Jamestown Engine Plant in Jamestown New York (U.S.A.) showcased in September 2017 its latest energy-saving initiative, a $47 million block machining line that utilizes on-demand hydraulics, coolant and pneumatics to reduce power consumption as it produces the company’s high efficiency diesel and natural gas heavy duty engines. The line was completed in May, and is merely the most recent energy-saving investment at the plant.  The plant in recent years has also replaced nearly 3,000 fluorescent lights with advanced LED lighting and a Wi-Fi-enabled control system that can automatically shut the lights off in parts of the plant not in use. The plant also has a solar array on its roof.

 

blair claflin director of sustainability communications

Blair Claflin

Blair Claflin is the Director of Sustainability Communications for Cummins Inc. Blair joined the Company in 2008 as the Diversity Communications Director. Blair comes from a newspaper background. He worked previously for the Indianapolis Star (2002-2008) and for the Des Moines Register (1997-2002) prior to that. blair.claflin@cummins.com

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