Nissan to Build Mercedes Engines in the U.S.

Renault- Nissan and Daimler have announced the joint engine production of Mercedes-Benz 4-cylinder engines at Nissan’s Decherd, Tennessee, plant beginning 2014.

According to the press release, this marks the first ever production of a Mercedes-Benz engine within the North America Free Trade region.

Dr. Dieter Zetsche, Chairman of the Daimler Board of Management and Head of Mercedes-Benz Cars, 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 realize near-market engine production in the NAFTA region on attractive economic terms and make optimum use of synergies arising from cooperation. Thus, we are systematically broadening our manufacturing footprint in this important growth market.”

Renault-Nissan CEO Carlos Ghosn adds, “This is the newest milestone on our pragmatic collaboration and our most significant project outside of Europe so far. 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.”

Nissan first began to assemble engines in Decherd, Tennessee, in 1997. Currently manufacturing 4-, 6-, and 8-cylinder engines for the North American produced Nissan and Infiniti products, Decherd has produced more than 580,000 engines in 2011. Production capacity of the Mercedes-Benz 4-cylinder could potentially reach 250,000 engine units per year once full ramp-up is achieved.