Daimler-Nissan break ground in Mexico

Daimler and the Renault-Nissan Alliance yesterday broke ground for their joint-venture manufacturing complex, COMPAS (Cooperation Manufacturing Plant Aguascalientes) in central Mexico set to build next-generation premium compact vehicles for the brands Mercedes-Benz and Infiniti.

COMPAS is equally owned by Daimler and Nissan. The partners will invest a total of US$1 billion in the joint venture which will oversee the construction and operation of the state-of-the-art manufacturing plant.

Located near the Nissan Aguascalientes A2 plant, COMPAS will have an initial annual production capacity of more than 230,000 vehicles and will create about 3,600 direct jobs by 2020. For the first time, Daimler and Nissan component suppliers will be shipping in parts Just-in-Time to a common plant. Daimler engineers will be able to experience at first Nissan's in-plant quality procedures.

Depending on market development and customer demand, there will be the potential to add additional capacity.

Production of Infiniti vehicles begins first in 2017, while the first Mercedes-Benz vehicles will roll off the line in 2018.

In addition to the direct employment it provides, COMPAS is also expected to generate some 12,000 indirect jobs – largely due to a high localization rate which will significantly increase the Mexican supply base.

COMPAS is led by an international management team from Daimler and Nissan: Ryoji Kurosawa is chief executive officer, Uwe Jarosch is chief financial officer and Glaucio Leite, is chief quality officer.

“Today marks an important milestone for the partnership between Daimler and the Renault-Nissan Alliance. This new joint plant will help both partners to serve their respective customers faster and with more flexibility. As Mercedes-Benz’ first production location for compact cars in the NAFTA region, it will also significantly enlarge our footprint here,” said Markus Schäfer, member of the divisional board of Mercedes-Benz Cars, Production and Supply Chain Management, at the ground-breaking ceremony.

“On our end, while sharing high efficiency and flexibility in the joint venture, we will add Mercedes-Benz specific technology as well as further training and assistance by our global lead plant for compact cars in Rastatt, Germany. This proven approach will guarantee that our quality here in Aguascalientes will be the same as at the other locations of our global compact car production network in Europe and China.”

As announced in June last year, Daimler and the Renault-Nissan Alliance will cooperate also in the development of the next-generation premium compact vehicles for the brands Mercedes-Benz and Infiniti.

The two partners say they will “closely collaborate at every stage of the product creation process”. Brand identity will be safeguarded as the Mercedes-Benz and Infiniti vehicles will clearly differ from each other in terms of product design, driving characteristics, and specifications.

No mention is made however of component-sharing which could increase cost-benefit.

Daimler and the Renault-Nissan Alliance will also produce the next-generation premium compact cars at other production locations around the world, including Europe and China.

Mexico is already a key location for Daimler with a total of around 8,000 employees. The group has production plants for trucks and buses in Saltillo, Santiago Tianguistenco, and Garcia, a parts distribution centre in San Luis Potosí and a remanufacturing plant, a product delivery centre, and a training centre for passenger cars located in Toluca.

Nissan has been producing vehicles in Aguascalientes since 1992. In November 2013, Nissan opened a second manufacturing complex in Aguascalientes, Aguascalientes A2. Nissan also has a plant in Cuernavaca. Together, the three plants have an annual production capacity of 850,000 vehicles. Nissan is the leading automaker in Mexico, accounting for one in four cars sold.