Nissan, Mercedes team for North American engine production

DETROIT—The Renault-Nissan Alliance and Daimler have teamed up to build Mercedes-Benz 4-cylinder engines for Infiniti and Mercedes at Nissan’s Decherd, Tenn. plant

While the agreement isn’t expected to start production until 2014, once it’s live the plant  will produce up to 250,000 Mercedes-Benz 4-cylinder gasoline engines a year.

The collaboration marks the first production of Mercedes-Benz engines in the North America Free Trade region. It’s expected the engines will be used in the Mercedes C-Class, which is built at Daimler’s vehicle plant in Tuscaloosa, Ala.

Nissan began powertrain assembly in Decherd in 1997, where it manufactures 4-, 6- and 8-cylinder engines for its lineup of U.S.-produced Nissan and Infiniti vehicles. The plant also houses crankshaft forging and cylinder block casting operations. It produced more than 580,000 engines in 2011.