Berlin - The southern German state of Bavaria was getting ready Saturday for an election that could result in heavy losses for a key ally of Chancellor Angela Merkel.

Sunday's state election could see the conservative Christian Social Union (CSU) losing its absolute majority in the state where it has ruled alone for 42 years, according to opinion polls.

If the CSU wins fewer than half the 180 seats in the state parliament in Munich, it could indicate dwindling support for the conservative camp and weaken Merkel's chances of retaining power in federal elections next year.

The CSU is the Bavarian sister party of Merkel's Christian Democrats (CDU) and has been a major source of support for the party at previous votes at national level.

But opinion polls are predicting a swing by the 9.3-million Bavarian electorate to smaller parties such as the Greens, the liberal Free Democrats, the regional Free Voters and the pro-labour Left Party.

The left-of-centre Social Democrats (SPD), who form part of Merkel's grand coalition in Berlin, are not expected to profit from voter dissatisfaction with the CSU.

Opinion polls put the SPD at around 20 per cent, the same as in the last state elections five years ago, while the CSU is tipped to win between 47 and 49 per cent, well below the 60.7 per cent they polled in 2003.

In a bid to mobilize voters, the CSU launched a massive mailing campaign in the week before the election and invited Merkel to address the final campaign rally.

"The CSU's policies have made Bavaria strong and as a result the whole of Germany as well," Merkel said on Friday.

The Alpine state, where some of Germany's leading companies have their headquarters, including Siemens and BMW, is one of the country's most prosperous regions.

"I am convinced we will achieve our stated of goal of 50 per cent or more," said Guenther Beckstein, 64, who was elected premier last year after long-time leader Edmund Stoiber was toppled in a party rebellion.

Massive losses by the state-owned bank BayernLB, the scrapping of a prestigious super-fast train link to Munich airport and a controversial smoking ban have combined to increase voter discontent with the leadership duo of Beckstein and party chairman Erwin Huber.

The party sought to counter this with a campaign highlighting the CSU's past successes, while pushing for greater tax breaks for commuters and better conditions for working mothers. 

SPD leader Fritz Marget could be lured into a four-way alliance with the four smaller parties if they all clear the 5-per-cent hurdle needed to enter parliament and the CSU fails to secure a majority.

Opinion polls show the Greens reaching 11 per cent, an improvement on their 7.7-per-cent showing in 2003, while the FDP is likely to scrape into parliament after an absence of 14 years.

The Free Voters are projected to win around 8 per cent.

But the FDP could sidestep the SPD and opt for a coalition with the CSU, increasing the party's profile ahead of national elections in September 2009, when it is eyeing a coalition with Merkel's CDU. (dpa)