Daimler AG, 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.
The sale of Mercedes outlets to Stern Auto GmbH, 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 percent of sales to close a gap in profitability to larger luxury-auto competitors BMW AG and Audi AG. 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 percent in 2014.
Read more at Bloomberg Business.