In May 2017, Cummins and The Olayan Group launched Cummins Arabia, a 50:50, three-country distribution joint venture company in the Middle East.
This joint venture consolidates the distribution of Cummins products in the United Arab Emirates (UAE), Saudi Arabia, and Kuwait. Those products were previously distributed by Cummins’ wholly-owned UAE distributor and Olayan-owned independent distributors – General Contracting Company (GCC) in Saudi Arabia and General Transportation and Equipment (GTE) in Kuwait. These three countries represent some of the largest markets for Cummins in the Middle East. The partnership allows Cummins to greatly expand access to the Saudi and Kuwaiti markets and operate closer to its customer base. At the same time, it will provide a valuable platform for the training and employment of nationals in each country.
In a March 2016 press release announcing the JV formation, Tom Linebarger, Chairman and CEO, Cummins Inc. stated: “Cummins is pleased to partner with Olayan, which is a highly respected leader in the global distribution business. Olayan brings years of Middle East experience, and this partnership provides opportunities for our companies to grow and expand in this region while enhancing the service and support we provide to customers. Cummins will continue to look for new ways to build global partnerships that drive growth and success for our company, our partners, and our customers.”
Lubna Olayan, CEO of Olayan Financing Company, commented: “We view our new joint venture as a natural evolution of the close working relationship that has existed between us and Cummins for more than 60 years. We began distributing Cummins products in Saudi Arabia in 1956 and have always viewed ourselves as operating in a real spirit of partnership. This new company will further enhance our product offerings and services in the region and is truly a win-win proposition – for Cummins, for us, and for our customers.”
Headquartered in Al Khobar, Saudi Arabia, plans are underway to build dedicated facilities in Al Khobar, Riyadh, Jeddah and Qassim. Cummins Arabia is led by Mike Sharp, Managing Director, and has close to 500 employees representing over 30 nationalities. As a Cummins-managed JV, the Cummins Operating System, and all tools and processes that come with this practice, will be followed.
The consolidation of joint activities under this new entity provides opportunities for both companies to better align goals and work as one company, delivering the full power of the Cummins brand to meet every customer need and grow market share. Equally as important, the joint venture allows Cummins and Olayan to achieve greater scale, improve parts availability and inventory management, and centralize specific functional support across these countries to provide enhanced and consistent, world-class service to customers in the region.
For more information, visit http://middleeast.cummins.com/cummins-arabia.