Nissan to build Mercedes engines in U.S. plant
Infiniti, Mercedes models to carry the 4-cylinder powerplants
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DETROIT -- Nissan Motor Co. and Daimler AG have agreed to produce four-cylinder Mercedes-Benz gasoline engines at Nissan's engine plant in Decherd, Tennessee, from 2014.
The engines will be fitted on Mercedes and Infiniti models.
The operation will have a capacity to build 250,000 engines a year "once full ramp-up is achieved," the companies said in a joint statement released on Sunday.
The effort expands on a wide-ranging agreement, announced in April 2010, for Daimler and the Nissan-Renault alliance to share vehicle and powertrain technologies.
"This is the newest milestone in our pragmatic collaboration and our most significant project outside of Europe so far," Renault-Nissan CEO Carlos Ghosn said in the statement. "Localized capacity reduces exposure to foreign exchange rates while rapidly enabling a good business development in North America -- a win-win for the Alliance and Daimler."
Daimler touted the plan as a way to provide a direct supply of engines for the Mercedes C-class vehicles produced at Daimler's plant in Tuscaloosa, Alabama.
Daimler CEO Dieter Zetsche said the plan fits the German automaker's 2020 expansion program.
"We have decided that we will expand the production capacities required for this (expansion) close to the customers," Zetsche said in the statement.
A Nissan-Renault spokeswoman declined comment when asked which Infiniti model would be getting the new Mercedes engine.
Nissan began powertrain assembly in Decherd in 1997. The plant now makes 4-, 6- and 8-cylinder engines for U.S.-produced Nissan and Infiniti vehicles. In 2011, Nissan said the Decherd plant produced more than 580,000 engines.
The Daimler and Renault-Nissan collaboration including an equity exchange that gives the Renault-Nissan Alliance a 3.1 percent stake in Daimler and Daimler a combined 3.1 percent interest in Renault and Nissan, the companies said.
PRESS RELEASE: Nissan and Daimler to produce engines together in North America
In the latest step forward in the collaboration of the Renault-Nissan Alliance and Daimler, Nissan's Decherd, Tenn., plant will build Mercedes-Benz 4-cylinder engines for Infiniti and Mercedes-Benz starting in 2014.
DETROIT (Jan. 8, 2012) –Nissan and Daimler will produce Mercedes-Benz 4-cylinder gasoline engines together at Nissan's powertrain assembly plant in Decherd, Tenn. Production will begin in 2014, with installed capacity of 250,000 units per year once full ramp–up is achieved. The Decherd facility will produce engines for Mercedes-Benz and Infiniti models.
"This is the newest milestone in our pragmatic collaboration and our most significant project outside of Europe so far," said Renault-Nissan CEO Carlos Ghosn. "Localized capacity reduces exposure to foreign exchange rates while rapidly enabling a good business development in North America – a win-win for the Alliance and Daimler."
The collaboration marks the first production of Mercedes-Benz engines in the North America Free Trade region. The Tennessee plant's strategic location and logistics links ensure a direct supply of engines starting in 2014 for the Mercedes-Benz C-Class, built at Daimler's vehicle plant in Tuscaloosa, Ala.
"In the context of our Mercedes-Benz 2020 growth strategy, we have decided that we will expand the production capacities required for this close to the customers. Through the strategic extension of our cooperation with Renault-Nissan we can realize near-market engine production in the NAFTA region on attractive economic terms and make optimum use of synergies arising from the cooperation," Dr. Dieter Zetsche, Chairman of the Daimler Board of Management and Head of Mercedes-Benz Cars, said. "Thus we are systematically broadening our manufacturing footprint in this important growth market."
Nissan began powertrain assembly in Decherd in 1997. Today it manufactures 4-, 6- and 8-cylinder engines for the complete lineup of U.S.-produced Nissan and Infiniti vehicles. The plant also houses crankshaft forging and cylinder block casting operations. In 2011, Decherd produced more than 580,000 engines on a covered area of more than 1.2 million square feet (111,000 square meters).
Project portfolio expands
Daimler and the Renault-Nissan Alliance launched their strategic collaboration in April 2010, including an equity exchange that gives the Renault-Nissan Alliance a 3.1 percent stake in Daimler and Daimler a combined 3.1 percent interest in Renault and Nissan.
The collaboration began with three project pillars:
• Joint Smart/Twingo architecture: The project is on track for launch in the early first quarter of 2014. Two-seater smart vehicles will be produced at Daimler's plant in Hambach, France, and four-seater smart and Renault production are slated for Renault's plant in Novo Mesto, Slovenia.
• All-new entry-level city van project for Mercedes-Benz: The project is on schedule with expected launch in late 2012. Manufacturing at Renault's plant in Maubeuge, France.
• Powertrain cross-supply: The Alliance is supplying Daimler with compact three-cylinder gasoline engines to be used in smart and Twingo vehicles and four-cylinder diesel engines to be used in the jointly developed light commercial vehicle and in Mercedes-Benz's next generation of premium compact cars. Daimler will supply Nissan and Infiniti with four- and six-cylinder gasoline and diesel engines from the current and future engine portfolio as well as with automatic transmissions.
Since its founding in April 2010, the collaboration has been gradually expanded. In addition to the announcement this week about North American engine production, the companies also decided to partner on:
• Platform sharing: Infiniti plans to base a premium compact vehicle on the Mercedes compact-car architecture, starting in 2014.
• Zero-emission vehicles: Daimler will provide batteries from its production facility in Kamenz, Germany, and Renault-Nissan will provide electric motors for the use in electric vehicles (smart and Twingo ZE). First releases will occur in 2014.
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