Nissan's US unit has broken ground for a second engine plant at the automaker's complex in in Decherd, Tennesee. It will produce I4 petrol engines for Infiniti, and Mercedes-Benz C-class cars assembled at Daimler's plant at Tuscaloosa, Alabama.

"Today, we begin an exciting new chapter for the Renault-Nissan alliance and our continued investment in the United States," Nissan US production engineering and component factory chief Mark Swenson said at a ceremony to mark the start of construction. "Today's groundbreaking marks the latest move in our collaboration with Daimler to localise production capacity and enhance our competitiveness in the global market."

Production of the new engines will begin in 2014 with installed capacity of 250,000 units per year. At maximum capacity, the new facility is expected to create up to 400 jobs and will be the Mercedes-Benz engine manufacturing factory in the NAFTA region.

Daimler and the alliance announced 'strategic collaboration' in April 2010 and are extending their reach into the United States as part of both companies' growth strategy. They are working on vehicle platform sharing between Infiniti and Mercedes and developing 'zero-emission' [electric] vehicles. Jointly producing engines in the US is the largest joint venture outside Europe.

Nissan began powertrain assembly in Decherd in 1997 and it currently makes I4, V6 and V8 engines for US-produced Nissan and Infiniti models. The plant also has crankshaft forging and cylinder block casting operations. In 2011, Decherd produced about 580,000 engines. Following the March 2011 Japanese earthquake, which disrupted domestic engine supply, some Decherd-made engines were shipped to Nissan vehicle assembly plants in Japan.