Leading figures in Germany's conservative Christian Democratic Union (CDU) meet in Berlin on Sunday to lay the groundwork for a party conference in December that will elect a new party leader to replace Chancellor Angela Merkel.

Merkel, who has led the party for 18 years, announced on Monday that she would give up the role after a drubbing for her conservative bloc in state elections in Hesse and Bavaria in the previous two weeks.

The announcement by Merkel, who said she still plans to serve out her term as chancellor until 2021, sparked a race to replace her, with three leading CDU figures already throwing their hats in the ring.

The three are: Jens Spahn, Germany's current health minister and a Merkel critic; lawyer Friedrich Merz, the former head of the conservative bloc in the Bundestag, now serving on many company boards; and Annegret Kramp-Karrenbauer, the CDU secretary general and one of Merkel's allies.

Sunday's meeting is also expected to address the CDU's poor results in regional elections - Hesse was its worst result there since 1966 - and how to revive its popularity.

It is widely accepted that the party's drop in the polls is due to the infighting within the Berlin coalition between the CDU, its Bavarian sister party, the Christian Social Union (CSU), and the centre-left Social Democrats (SPD).

The CDU holds its party conference from December 6 to 8 in the northern port city of Hamburg. A new managing board, executive committee as well as party leader are set to be elected there.