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There was also a problem in adequately protecting the licensed technology from unauthorised use by other parties. This led to rise in competition. Cummins Inc. was not able to penetrate the Chinese market with its new and advanced technological products as the licensees did not keep up with the technical improvements elsewhere in the world. This exposed Cummins Inc. to various reputational risks as well.
Risks in Joint Venture
In the early 90’s, Cummins Inc. took advantage of the changing Chinese business environment and converted its two licenses to 50-50 joint ventures with CCEC and DFM. This gave Cummins Inc...
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