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Diesel manufacturer Cummins begins new expansion; Company benefits mostly from overseas markets

Fueled by overseas sales, Rust Belt jewel Cummins Inc. is expanding again, adding 600 professional jobs by 2014 in a new office building.

Columbus is benefiting as its hometown diesel manufacturer powers through the recession, riding a crest of rising sales on the far side of the Pacific and south of the equator.

"Our fastest growing markets are outside the United States, and that allows us to invest in Columbus," Cummins President Thomas Linebarger said.

In a sign that Cummins no longer relies mainly on the United States for its earnings, Linebarger predicted "2011 will be the best year ever" for the company.

Cummins' expansion contrasts with the U.S. jobless rate, which in May edged up to 9.1 percent.

Sen. Richard Lugar, R-Ind., called Cummins a model for the future. He said many Americans, including politicians, don't understand what Cummins figured out: how to compete in the world.

"We have to be confident we can take on whoever is out there," Lugar said.

Cummins, which operates a 1,300-job diesel engine plant outside Jamestown, N.Y., looked out at the world decades ago and took global risks when many other U.S. companies were comfortable in America.

Cummins executives toured China in the 1970s, not long after President Richard M. Nixon's historic visit. That led to a joint venture with Chinese automotive giant Dongfeng Motor Corp. The venture today is one of China's leading suppliers of truck engines. The plant is located in China.

Cummins tends to produce in the regions where it sells the products. Exports account for about a third of Cummins' revenue, which totaled $13.2 billion last year. For every $1 in sales that Cummins takes in, 64 cents comes from outside the United States.

The company plans to invest $75 million over the next few years in Africa, a relatively under-served region for Cummins. The money will expand a sales network.

Cummins will export its diesels, generators, filters and other products to Africa. Although, if the business reaches a large size, production would most likely move there.

Last year, profits totaled $1.04 billion, up 143 percent from the $428 million earned the year before. Earnings soared, even though U.S. sales have slumped by more than $1 billion annually for Cummins since the recession began in 2007.

Sales volumes in Brazil, China and India together rose $1.2 billion per year since 2007, while annual business in other counties climbed by $200 million.