Social Democratic Party (SPD) candidate Martin Schulz, who's challenging Merkel on a platform of greater income equality, saw his party suffer its third straight defeat in regional voting in the last test before the national election on Sept 24.
German Chancellor and chairwoman of the German Christian Democratic Party (CDU) Angela Merkel smiles during a press conference at the party's headquarters in Berlin, Germany, Monday, May 15, 2017, one day after the election in the German state of North Rhine-Westphalia.
Victory for Mrs Merkel's Christian Democrats in the western state of North Rhine-Westphalia, which includes Cologne, Duesseldorf and the Ruhr industrial region, is a stinging blow to Germany's Social Democrats party.
Sunday's vote was the last state election before the federal election set for September 24, and was widely seen as a vital pre-duel between Merkel's CDU and ex-President of the European Parliament Martin Schulz's SPD.
Voters in North Rhine-Westphalia Sunday handed Schulz's SPD just 31.2 percent, sharply less than the 39.1 percent it garnered five years ago, final results showed. But defeats in two other state elections since then had already punctured the party's euphoria over Schulz's nomination, and its ratings have sagged.
FDP leader Christian Lindner seized on the party's 12.1 percent vote as signalling its comeback after the party was bounced out of the federal Parliament in Berlin following the last national poll in 2013.
Germans have taken to the polls in the country's most populous state in a vote that pundits say could determine Germany's future political direction.
Given the abysmal loss, SPD officials will spend the coming days analyzing the mistakes made in North Rhine-Westphalia - especially given the previous two crushing regional defeats.
The opinion polls were the latest indication that initial enthusiasm for the new SPD leader, Martin Schulz, could be fizzling out.
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North Rhine-Westphalia, Germany's biggest regional economy, has tripped up the Social Democrats before.
The anti-immigration Alternative for Germany, once polling as high as 13 percent, won its first seats in the state assembly with 7.4 percent.
Dumped out of parliament, for the first time since the war, if the Free Democrats can replicate yesterday's result on a national level in September, they could form another coalition with Merkel's CDU, and leave the SPD out in the cold.
"It's a hard day for the SPD, a hard day for me personally", Schulz told supporters in Berlin.
Bild daily wrote that voters had rewarded local politicians who had shown they backed Merkel, and provided "something to think about" for those in the CDU who had called for her head. But she added: "The national election campaign is only beginning now".
Four months before the German election, an economic boom is buoying the national mood as the refugee crisis that depressed Merkel's approval ratings past year recedes.
But Dr Merkel, who had also gone all out to sway the state of 18 million people, including 4.2 million of migrant origin, took aim at Mr Schulz's arguments. "We achieved both, I thank everyone for their commitment during the last days", said the CDU's victor, Armin Laschet.
Merkel's party scored a similar upset win over a Social Democrats-Greens coalition in the rural northern state of Schleswig-Holstein on May 7 after pulling off an unexpectedly strong win in the small state of Saarland, on the French border, on March 26.
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