Infiniti will use Magna for the production of its A3-fighting small car.

Nissan has announced that it will use contracting firm Magna International to produce an upcoming compact car for its Infiniti luxury brand. Magna will begin production of the compact premium car in 2014.

Although based in Canada, Magna International will use its Magna Steyr branch to produce the Infiniti compact at a plant in Graz, Austria. Thanks to the tie-up, Infiniti will become the first premium Asian brand to produce vehicles on European soil.

The Infiniti compact is expected to ride on the same platform as the Mercedes-Benz A-Class, with engines also sourced from Mercedes. Styling will be heavily influenced by the Etherea concept car, which made its world debut at the 2011 Geneva Motor Show.

Although no specific details were given, sources have suggested that Magna could produce up to 60,000 units of the compact per year. Infiniti sold just 3,681 cars in Europe last year, but the Japanese automaker is hopeful that the locally built compact will give the company a better foothold in the region.

Infiniti expects to sell 500,000 units worldwide by 2016, up from 146,000 in 2011.