Renault-Nissan Alliance Teams With Daimler in Mexican Joint Venture

Five years into their strategic cooperation, the Daimler-Renault-Nissan partnership is expanding with a new manufacturing venture in Central Mexico.

Daimler and the Renault-Nissan Alliance have been working together for five years, mostly in Europe, to build synergies to lower costs of manufacture. Now they've entered into a venture in Central Mexico as a new business entity, COMPAS (Cooperation Manufacturing Plant Aguascalientes) in a 50:50 partnership. A total of $1 billion will be invested in the plant, which will eventually take next-generation premium compact vehicles into production.

The plant will be near Nissan's current Aguascalientes A2 plant, which will facilitate lower-cost supply chain operations. The new plant's initial production capacity will be 230,000 vehicles by 2020. Additional capacity will be built in with Infiniti branded vehicles slated to begin rolling off the line by 2017 and Mercedes-Benz vehicles in 2018.

"COMPAS is an outstanding example of the global reach of the Renault-Nissan Alliance and Daimler cooperation. Together we are combining the manufacturing expertise of Nissan and Daimler in one production plant in Mexico for the production of next-generation premium compact cars," said COMPAS CEO Ryoji Kurosawa. "Aguascalientes was selected as the location for this new plant thanks to the state's well-established supplier base and Nissan's track record in highly efficient manufacturing in Mexico for more than three decades," he added.

The partners have not announced where the cars will be sold, but it's likely that most of them will stay in the North American region. The two partners plan to closely align to produce a joint vehicle for branding with both the Mercedes-Benz and Infiniti badges in the premium compact segment. The two branded vehicles will share underpinnings and some body elements, but will otherwise be different in exterior and interior fit and design to preserve brand identities. These vehicles will be built in the new Mexican plant as well as in shared facilities in Europe and China.

The new COMPAS facility will become the first Mercedes-Benz plant in North America.