Magna Steyr will build Infiniti’s new premium compact car

Article by Christian A., on May 11, 2012

Japanese carmaker Nissan said that beginning in 2014, Austrian contract manufacturer Magna Steyr will produce a new premium compact car for its Infiniti brand. Through a statement, Infiniti chief Andy Palmer said that the car will help the brand reach new consumers and expand in key markets like western Europe. Nissan didn’t offer further information on the car or say if it will be sold in markets outside Europe like in the United States.

Last December, sources told Automotive News Europe that Nissan hopes to release the entry-level car globally to help get a 10-percent share of the global luxury market. Previously, Infiniti executives said that the entry-level model will go up against premium compact cars like the Audi A3 and Mercedes-Benz A class.

It is believed that the car will be based on Mercedes's MFA compact platform that is used for the new A- and B-class cars. In 2010, Renault-Nissan and Mercedes parent Daimler revealed a strategic cooperation between the two companies. A report from Automotive News Europe last December also said that Daimler will supply numerous preassembled "complete parts" to Infiniti. Back then, sources said that around 50,000 to 60,000 units annually of the Infiniti could be produced in Graz.

These cars will be exported worldwide and will be available with Mercedes' four- and six-cylinder diesel and gasoline engines. Infiniti is able to prevent possibly enormous development costs by using Mercedes parts.

In return, Mercedes gets licensing fees for every manufactured vehicle and gains from economies of scale. It was in 2008 that Infiniti started to sell cars in Europe but progress was slow as it faced competition from established German premium competitors and Toyota's Lexus. In 2011, Infiniti sold 3,681 cars in Europe, a 54-percent increase on 2010, according to a JATO Dynamics report.

Nissan Motor is a Japanese multinational carmaker headquartered in Nishi-ku, Yokohama. It sells vehicles under the Nissan, Infiniti, and Datsun brands. It also sells in-house performance tuning products labeled as Nismo. Nissan got its name from the Nissan zaibatsu, now called Nissan Group. Nissan entered an alliance with Renault S.A. of France in 1999, resulting to the Renault-Nissan Alliance.

Infiniti serves as the luxury vehicle unit of Nissan. The Infiniti brand was first introduced in the US in 1989, targeting premium vehicle segments in the country that wouldn’t fit in with Nissan's mainstream image. The brand was created at almost the same time when Toyota and Honda developed their Lexus and Acura premium brands. However, the Infiniti marque is not used in Japan.

Based in Graz, Magna Steyr engineers, develops and assembles vehicles for other carmaker on a contractual basis.

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