COLUMBUS, Ind. — Cummins chairman and CEO Tim Solso has announced his retirement from the company.

Solso had served as the company’s leader since 2000 and has been with Cummins for 40 years. He’ll be replaced by Tom Linebarger, president and chief operating officer of Cummins, who has been with the company for 17 years. The transition will take place Jan. 1, 2012, Cummins announced.

“The time has come to say thank you and best wishes to an extraordinary business leader and a wonderful human being,” said Alexis Herman, lead director of the Cummins Board of Directors and chair of the Governance and Nominating Committee. “Tim has led the company through many years of record performance and outstanding shareholder returns. He championed Cummins’ international growth and the importance of a diverse workforce. Equally impressive has been his unwavering focus on corporate responsibility and making a difference in the communities where Cummins does business.”

Cummins says its market capitalization grew tenfold under Solso’s watch.

Linebarger has been with Cummins since 1994 and has served in various roles and notably returned the company’s power generation business to profitability after taking over as its head in 2003. Cummins says its power generation business is now enjoying record sales growth and profitability. Linebarger was named president and COO in 2008.

“In Tom Linebarger we have an individual who shares the same qualities of leadership and commitment to Cummins’ values as his predecessors,” Herman said. “He has extensive experience in the operational and financial aspects of the company. And he brings with him limitless energy and enthusiasm for the rigors of competing in a challenging global business environment.”