NASHVILLE -- Automotive News, February 6, 2012-- The U.S. engine-sharing deal announced last month between Nissan Motor Co. and Daimler AG indicates high Nissan hopes for a future Infiniti car.

Nissan's share of the engines from the venture signals that Infiniti expects to sell as many as 125,000 compact hatchbacks a year -- a volume greater than Infiniti's entire 2011 U.S. sales.

So far, Nissan has not said officially that it will even build a new small-engine Infiniti model or specified what markets it could be sold in, but dealer sources say they have been told such a product has received the go-ahead.

Daimler and Nissan said in January they will jointly build 250,000 Mercedes-designed four-cylinder engines a year starting in 2014 at Nissan's powertrain plant in Decherd, Tenn. The deal will have the automakers split the resulting engines 50-50.

The Daimler share will power the Mercedes-Benz C-class sedans that Mercedes will begin producing in Alabama in 2014.

The Nissan share is earmarked for Infiniti, according to a company statement. Because no Infiniti vehicles use a four-cylinder engine, the plan points to a new sporty entry-level compact vehicle based closely on the Etherea hatchback concept that Infiniti displayed last month at the Detroit auto show.

Infiniti executives said last year that the Etherea concept shows how Infiniti would enter the lower spectrum of the luxury market. Infiniti is out for higher volumes. The brand has been challenged in the past year, first by the March 2011 earthquake in Japan, where it currently gets 100 percent of its products, and then by the high value of the Japanese yen.
Infiniti clearly wants two things going forward: vehicles in higher-volume segments and more content manufactured outside Japan.

In the coming weeks, Infiniti will launch production of its only U.S.-made vehicle, a new family-oriented, V-6-powered mid-sized crossover called the JX. Like the Etherea concept, the JX is envisioned as a high-volume product. The JX is expected to become Infiniti's second-best selling product after the G sedan.

Last year, Infiniti retailers sold 58,246 G sedans, and the entire brand sold 98,461 vehicles.