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NISSAN, DAIMLER MAY BUILD VEHICLES AT EACH OTHER'S PLANTS

By NBF NEWS
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Nissan Motor Company and Daimler AG may manufacture vehicles at each other's factories in the United States as part of a three-way alliance with Renault SA, Bloomberg reported on Wednesday.

'There is a possibility of cross-manufacturing,' Nissan and Renault's Chief Executive Officer Carlos Ghosn, 56, said in an interview. 'We will probably be using existing assets, so there are no plans to build a new factory in the partnership.'

Renault, Nissan and Daimler today signed an agreement that will include cross-shareholdings of as much as 3.1 per cent. The automakers plan to share development costs for platforms and technologies including powertrains, adding up to as much as $2.7bn in combined savings for Renault and Nissan in the first five years, according to the companies.

Nissan, Japan's third-biggest automaker, exports all of its Infiniti luxury vehicles to the US from factories in Tochigi and Kyushu in Japan, while Daimler also ships some cars and commercial vehicles to the US, Ghosn said. Nissan's Canton, Mississippi factory, which makes Quest minivans and Armada sport-utility vehicles, is capable of building light trucks, he said, while Daimler has a car plant in Alabama.

'To the extent that automakers have common parts and common development of vehicles, sharing production may well be a project they will consider,' said Tatsuya Mizuno, director of Mizuno Credit Advisory in Tokyo.

As part of the linkup, Daimler will swap a 3.1 per cent stake for shares in Renault and in Nissan, the three carmakers said in a joint statement today.

Nissan fell 0.4 per cent to close at 825 yen in Tokyo trading today. Renault dropped as much as 1.4 percent to 36.35 euros in Paris and Daimler rose as much as 1.1 per cent to 35.86 euros.

Yokohama, Japan-based Nissan completed a $118m expansion and retooling project for commercial-vehicle production at its Canton plant last month. Nissan's other US vehicle plant, in Smyrna, Tennessee, builds vehicles including Frontier pickup trucks and Altima sedans. Boulogne Billancourt, France-based Renault doesn't make vehicles in the U.S.

Ghosn has said Nissan is trying to fully use its capacity in North America to take advantage of a weak US dollar. Daimler, the world's second-largest luxury-car maker, will move some production of the Mercedes-Benz C-Class model to a plant in Tuscaloosa, Alabama, its only car factory in North America, in 2014 from its Sindelfingen facility in Germany.