Nissan Breaks Ground on New Plant with Mercedes-Benz; Compact Infiniti Production to Austria

By Jacob Brown | May 10, 2012
Nissan is keeping itself busy, quickly expanding its partnership with Daimler, Mercedes-Benz's parent company. Announced this week, the Japanese automaker broke ground on a new plant in Decherd, Tennessee, to build engines for the 2014 Mercedes-Benz C-Class, and likely the next Infiniti G sedan, a car rumored to share the same platform. Scheduled to go online in 2014, the Decherd plant will be an expansion of Nissan's current facilities in Tennessee. It will be able to make 250,000 four-cylinder engines annually for the two automakers. Neither the Infiniti G nor the Mercedes-Benz C-Class are manufactured in the U.S. currently, but plans call for Mercedes-Benz to bring its C-Class production to its Tuscaloosa, Alabama, facility where it manufactures the M-Class and GL-Class, and where it will likely produce a crossover "coupe" in the near future to compete against the BMW X6. The plant will help the German Daimler more than Nissan, which already has several North American manufacturing sites, as Europe's struggling economy is making it difficult for automaker to keep pricing competitive on its entry-level models.
But the C-Class will soon be supplanted at the bottom of Mercedes-Benz's U.S. lineup with the B-Class and CLA-Class, front-wheel-drive compact cars based on existing European vehicles. And Nissan is looking to get a product based on the same vehicle, too, as part of the partnership the two automakers formed in 2010. The small car would be sold as an Infiniti, and the company just announced that it's planning to make such a car in Austria's Magna Steyr facility, a plant specializing in lower volume manufacturing. The car, likely previewed by the Infiniti Etherea concept (pictured above), will slot below the G sedan in the brand's lineup and will be powered by four-cylinder engines. Infiniti sold about 146,000 vehicles last year in the U.S., its largest market, but wants to expand its global brand sales to 500,000 by 2016. Under Nissan's aggressive "Power 88" strategy, the automaker wants to own eight percent of the world's new car sales by 2016. Forming alliances with other power players looks like a smart way to do it. Sources: Nissan, Reuters