Mercedes-Benz and Nissan Join Forces to Build 4-Cylinder Engines in the USA

Back in April of 2010, Daimler, Mercedes-Benz’s parent company, and the Renault-Nissan Alliance announced a broad strategic cooperation in which the two companies exchanged a 3.1 percent stake with each other and made plans to collaborate on several projects.

The partnership seems to be going well as the two automakers announced plans to produce Mercedes-Benz 4-cylinder gasoline engines together at Nissan’s powertrain assembly plant in Decherd, Tennessee. Production of the four-bangers will commence in 2014 with an initial annual capacity of 250,000 units.

“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 engines produced at Decherd will be used on both Mercedes-Benz and Infiniti models, including the next generation of the Mercedes-Benz C-Class which will be built at Daimler’s vehicle plant in Tuscaloosa, Alabama.

The collaboration between Daimler and the Renault-Nissan Alliance includes several projects such as the development of a joint Smart and Renault Twingo platform, both scheduled for launch in the first quarter of 2014, and a new entry-level van for Mercedes-Benz due in late 2012.

A third project involves a comprehensive powertrain cross-supply that will see the Alliance giving the Germans 3-cylinder gasoline engines for the Smart and 4-cylinder diesels for their jointly developed LCV and Mercedes-Benz’s next generation of premium compact cars, while Daimler will provide Nissan and Infiniti with four- and six-cylinder gasoline and diesel as well as with automatic transmissions.

In addition, Infiniti plans to base a premium compact vehicle on the Mercedes A-Class architecture, starting in 2014.

The two companies will also work together on the electric variants of the Smart and Twingo with Daimler providing the batteries and Renault the electric motors.