Cummins Engine Co., the world’s biggest maker of high-power diesel engines, said Tuesday its third-quarter revenue will fall below the previous quarter because of weak demand in Asia.
Cummins shares fell $7.50, or 17 percent, to $35.25, on the New York Stock Exchange.
The company said its revenue in the current quarter will be as much as 10 percent lower than last quarter’s $1.64 billion.
Cummins said it also plans to take a $145 million pretax charge in the quarter for a previously announced reorganization and a change in calculating engine warranty costs.
The company said revenues were sapped by lower-than-expected sales in Asia and weak agricultural markets worldwide.
It also said that costs to introduce engines will hurt profitability more than expected as the company grapples with lower sales to North American automakers because of shutdowns and model changes. Cummins had warned earlier this year of a “significant” charge to cut 1,000 jobs.
It reported third-quarter 1997 sales of $1.37 billion. It had full-year 1997 sales of $5.6 billion.
