Nissan and Daimler will produce four-cylinder engines at facilities in Tennessee, USA, from 2014. The engines will power a range of upcoming Infiniti vehicles, as well as future Mercedes-Benz models.

Carlos Ghosn and Dr. Dieter Zetsche

The companies plan to produce up to 250,000 engines per year once the project is in full swing. Renault-Nissan CEO Carlos Ghosn says this is the most significant project outside of Europe so far for the Alliance.

"Localised 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 strategic location of the plant will also ensure a direct supply of engines for upcoming Mercedes-Benz vehicles, including the new US-market C-Class which is made in Tuscaloosa. Mercedes-Benz chairman Dr. Dieter Zetsche recently said,

"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 realise near-market engine production in the NAFTA region on attractive economic terms and make optimum use of synergies arising from the cooperation."

The Decherd facility currently produces four-, six- and eight-cylinder engines for the entire US Infiniti and Nissan range.