INDIANAPOLIS - Allison Transmission, in partnership with Cummins (NYSE:CMI), has announced the successful completion of field testing for the new Cummins X15N 15-liter natural gas engine combined with the Allison 4000 SeriesTM fully automatic transmission. The testing, conducted by Sandman, a bulk cement hauling fleet in San Jose, California, covered over 50,000 miles and yielded significant fuel efficiency and performance enhancements.
The Peterbilt tractor used for the field tests, equipped with the X15N engine and Allison transmission, demonstrated notable improvements in engine braking, power during shifting, and overall productivity. Victor Landaverde, Fleet Manager at Sandman, expressed satisfaction with the performance, highlighting the flawless operation throughout the extensive testing period and the potential benefits for the company's fleet of over 100 Allison-equipped natural gas trucks.
Allison's 4000 Series transmission, known for its fuel efficiency, is paired with the X15N engine, which is lighter than its diesel counterpart, aiming to deliver additional fuel savings and reduced emissions. The transmission includes FuelSense® 2.0 technology, which offers up to 6% fuel savings through advanced software and electronic controls.
Rohan Barua, Vice President of North America Sales, Global Channel and Aftermarket at Allison Transmission, emphasized the company's commitment to providing propulsion solutions that support increased emissions standards without compromising fleet productivity. Barua pointed out that as the industry evaluates electric vehicle technology, alternative fuel engines are expected to gain popularity among customers.
The collaboration between Allison Transmission and Cummins reflects a growing industry trend towards sustainable energy sources. The partnership aims to assist fleets in reducing their carbon footprint while maintaining efficiency. Peterbilt and Kenworth trucks featuring the X15N and Allison fully automatic transmissions are now available for order.
Based on a press release statement, this report highlights the advancements in natural gas engine technology and its integration with automatic transmissions, offering a promising alternative to traditional diesel engines in the commercial vehicle sector. Allison Transmission (NYSE: ALSN) continues to be a global leader in the design and manufacture of propulsion solutions for a diverse range of applications.
In other recent news, Allison Transmission reported record-breaking net sales of $789 million in the first quarter of 2024, marking a 6% increase from the previous year. Despite a slight decrease in net income, the company reaffirmed its full-year guidance, expecting net sales to be between $3.50 billion and $3.150 billion. Citi initiated coverage on Allison Transmission with a Neutral rating and an $80.00 price target, expressing concerns about the company's ability to maintain its high market share in the face of increasing zero-emission vehicle adoption.
In a strategic move, Allison Transmission's venture capital arm, Allison Ventures, invested $10 million in venture capital firm EnerTech Capital, aiming to bolster their innovation strategy and market positioning in the automotive technology space. The company also announced the promotion of G. Frederick Bohley III to the position of Chief Operating Officer. Bohley, who has been with the company since 1991, will continue to serve as Chief Financial Officer and Treasurer until a successor is appointed. These recent developments underscore Allison Transmission's proactive approach to navigating the changing landscape of the automotive industry.
InvestingPro Insights
Allison Transmission has not only been making strides in technology and partnerships but also shows a robust financial health according to the latest data from InvestingPro. With a market capitalization of $7.41 billion and an attractive P/E ratio of 11.18, the company stands out in the industry. The P/E ratio further adjusts to an even more appealing 10.72 when looking at the last twelve months as of Q1 2024, indicating that the company is trading at a low price relative to its near-term earnings growth.
InvestingPro Tips highlight that Allison Transmission has a perfect Piotroski Score of 9, which is a strong indicator of the company's financial stability. Additionally, the company has raised its dividend for 4 consecutive years and has maintained dividend payments for 13 consecutive years, showcasing its commitment to shareholder returns. These tips are particularly relevant for investors looking for companies with a strong track record of profitability and consistent dividend policies.
The gross profit margins are also impressive, standing at 48.26% for the last twelve months as of Q1 2024. This level of profitability is indicative of the company's efficiency and its ability to maintain a competitive edge in the market.
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