Employees continued to demonstrate their ongoing commitment to corporate responsibility. Whether it was helping employees in China left homeless by massive flooding or sending care packages to U. S. soldiers abroad or feeding orphans in Rwanda or volunteering for Special Olympics, Cummins employees opened their hearts to help others. This generous spirit has been a tradition at Cummins for almost 90 years.

Looking to the Future

As we look to the future, our focus will continue to be profitable growth. We expect earnings to grow faster than sales in 2008 as every segment improves its operating performance, and we are predicting strong sales increases and nearly 20 percent growth in our EBIT. This high level of confidence in our business results is based on several important factors.

First, Cummins’ advanced technology has opened new doors for our products and will drive our longer-term growth. In particular, our technology will play an important role in markets related to more stringent emissions standards, better fuel economy, generating electricity and the needs of developing countries, such as China, India, Brazil, Russia, Vietnam and Nigeria.

Second, we have already increased our capital investment in many parts of the world in anticipation of these growing markets. We consider new plants and facilities – particularly in China and India – as a primary requisite for being a significant participant in these markets.

Along with the manufacturing and technical centers we built in recent years, we are planning 19 new plants and 42 capacity expansion projects, many of which are underway. These include a new fuel system plant in China, our light-duty project with Beiqi Foton Motor Company in Beijing and major expansions in India for both midrange and high-horsepower engines, power generation and turbochargers.