Mercedes and Nissan's years-old vehicle and engine-sharing collaboration will move another step toward unraveling in March when production ends at a Tennessee engine plant built specifically to share.
Nissan will "suspend operations at the powertrain facility in Decherd pending future product announcements," Nissan North America spokesman Brian Brockman said of the East Tennessee plant that opened in 2014.
Its 400 employees will be reassigned.
Earlier this month, Mercedes told dealers it will ditch the Tennessee-made four-cylinder engine that powers the brand's GLE midsize crossover as well as its Sprinter and Metris commercial vans.
Known as the Infiniti Powertrain Plant and constructed for $319 million next to Nissan's Decherd engine and components plant, the facility produced a Mercedes-developed turbocharged 2-liter four-cylinder engine — designed by Mercedes, manufactured by Nissan, and installed in models carrying both Infiniti and Mercedes badges.
But like other parts of the arrangement between Nissan's now-ousted Chairman Carlos Ghosn and the now-retired CEO of Daimler, Dieter Zetsche, the engine-sharing plan is running aground.
Infiniti Powertrain was built to produce up to 250,000 engines a year but managed to hit only 35 percent of capacity at its peak production in 2020. It produced only 50,000 units last year, according to AutoForecast Solutions.
The factory stopped building engines for the Infiniti Q50 after the 2019 model year. Now there isn't enough demand for the four-cylinder engines to justify keeping the Decherd plant running, said Brian Maxim, AutoForecast vice president of global powertrain forecasting.
Mercedes spokeswoman Andrea Berg said the engine "product cycle will end in the course of the next year. Production is running out according to plan, and the cooperation with Nissan in Decherd is ending."
It’s possible that the soon-to-halt Decherd plant eventually could be repurposed into an EV powertrain plant to support Nissan’s new $18 billion electrification push.