FRANKFURT (Bloomberg) -- Daimler is selling 15 Mercedes-Benz dealerships in eastern Germany to a unit of China's Lei Shing Hong Group in a bid to lift profitability.
The sale of Mercedes outlets to Stern Auto, including showrooms in Leipzig, Dresden and Rostock, affects 1,000 employees, Daimler said in a statement Friday. The Chinese company started operations in Germany last year by taking over a Mercedes dealership in Erfurt.
Lei Shing Hong, the world's largest Mercedes dealership group, has said it is on the lookout for sales outlets in Germany to develop techniques for operating in a mature market. Germany's car dealership model includes healthy profits from selling used approved vehicles and revenue from vehicle parts.
Daimler outlined plans last year to eventually sell 56 of the 158 outlets that it owns in Germany to external investors. The disposals will affect about 3,000 people out of a local auto-distribution workforce of 15,000.
Daimler CEO Dieter Zetsche has vowed to increase operating profit at the Mercedes division, including the Smart city-car nameplate, to 10 percent of sales to close a gap in profitability to larger luxury-auto competitors BMW and Audi.
Reuters contributed to this report
