(MENAFN- Gulf Times) Daimler, the maker of Mercedes-Benz luxury vehicles, is selling 15 car dealerships in eastern Germany to a unit of China's Lei Shing Hong Group in a bid to lift profitability, according to a Bloomberg unit. The sale of Mercedes outlets to Stern Auto, including showrooms in Leipzig, Dresden and Rostock, affects 1,000 employees, the Stuttgart-based car manufacturer said in a statement.
The Chinese company started operations in Germany last year by taking over a Mercedes-Benz dealership in Erfurt. Daimler chief executive officer Dieter Zetsche has vowed to increase operating profit at the Mercedes-Benz automotive division, including the Smart city-car nameplate, to 10% of sales to close a gap in profitability to larger luxury-auto competitors BMW and Audi. Zetsche has held off from setting a deadline for the goal since scrapping an already delayed target date in 2012.
The margin was 8.3% in 2014. 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. Picture shows a Mercedes-AMG V8 engine stands on display beside a Mercedes-Benz AMG E63 automobile, produced by Daimler, inside the company's showroom in Berlin.
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