PARIS (Reuters) – Nissan said it would stop production of cylinder heads for French car maker Renault at its plant in Sunderland, northern England, from early 2024, adding it did not expect this move to result in job losses.

“From early 2024, Nissan Sunderland Plant will cease production of cylinder heads on site. We do not expect this to result in job losses, and are working with staff as we redeploy them to other parts of the business,” the company said, confirming a Sky News report.

Nissan employs about 250 people to make cylinder heads for Renault petrol vehicles.

“Following a study about the economics of cylinder head suppliers, Renault Group has found another supplier that will start working with us from 2024,” a Renault spokesman said.

Renault has embarked on a multi-year cost-savings plan and a strategy shift in order to redress its financial situation.

Industry watchers say the end of the contract with Nissan will raise further questions about the future of the Renault-Nissan alliance, following the departure of former CEO Carlos Ghosn, the architect of that alliance.

Renault, Nissan and Mitsubishi want more than 80% of their models to be based on common platforms by 2026, despite questions about strategic convergence at the three companies in the coming decade.

(Reporting by Gilles Guillaume; Editing by Sudip Kar-Gupta and Bernadette Baum)