Les Echos is reporting Renault and Mercedes-Benz have reached an agreement for a diesel Renault engine to power the next-gen C-Class and Vito.

The engine in question is the 1.6 dCi 130HP Energy (aka R9M) which can be had in the Megane, Scenic and Nissan Qashqai. It will be offered for the entry-level model (C 200 CDI) and will go through a series of modifications to be compatible with C-Class' longitudinal engine layout.

Renault's version of the Euro5-compliant engine produces 130 HP (96 kW) at 4,000 rpm and 320 Nm (236 lb-ft) of torque from 1,750 rpm. It's being produced at Renault's factory in Cleon where there are 3,484 employees expected to boost production from 2015 since there will be more demand once the new C-Class hits the market.

An official announcement should occur sometime this week.