Daimler and Nissan have reportedly shaken hands on a venture deal that will let the companies jointly produce Mercedes and Infiniti compact cars in Mexico.
The automakers unveiled the plans at a news conference and plan to announce a "substantial investment" to use front wheel-drive architecture from Daimler and then assemble the cars at a Nissan site, sources told Reuters.
Details of the agreement will be revealed on Friday by Daimler Chief Executive Dieter Zetsche and Renault Nissan CEO Carlos Ghosn.
Coming together as allies in 1999, Renault and Nissan were joined in the automotive alliance by Daimler's Mercedes in 2010. Daimler and Nissan's agreement to collaborate on Mercedes and Infiniti models will mark the biggest-ever joint project for the three-way alliance, the Wall Street Journal reported.
Industry analysts call the agreement part of a larger trend where automakers strive to cut costs. Renault, Nissan and Daimler have shared manufacturing plants as well as production components including engines.
"This is all about scale," said Arndt Ellinghorst, automotive analyst with ISI Group in London, as quoted by WSJ. "It's about lowering costs by sharing the parts of the car that are less relevant to the consumer."
The plans to build Mercedes and Infiniti compact cars will boost the Infiniti lineup with "a new SUV, sedan and coupe sharing parts and architecture with successors to the Mercedes A- and B-Class, GLA and CLA," sources familiar with the matter told Reuters. For its part, Daimler will save on costs while getting the "MFA" vehicle architecture in a North American production line.
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