China Automotive Systems Hosts Ceremony for First Shipment to Dongfeng Peugeot Citroen

WUHAN, Hubei, China, December 8, 2008: China Automotive Systems, Inc., a leading power steering components and systems supplier in China, today announced that its subsidiary, Jingzhou Henglong Automotive Parts Co. ("Henglong"), conducted a ceremony to celebrate the first shipment of its power steering gears to the Dongfeng Peugeot Citroen Automobile Company Ltd. ("DPCA") for use in DPCA-manufactured cars.

In addition to Mr. Hanlin Chen, Chairman of CAAS and other senior management of the Company, the Mayor of Jingzhou City, where Henglong is based, the Purchasing Director of DPCA, an officer of PSA Global Procurement in Shanghai, and French automotive engineers attended the ribbon-cutting ceremony. Following the ceremony, all guests visited the production plant, testing center and R & D facility.

Mr. Hanlin Chen, Chairman, stated, "This first shipment represents a milestone in our drive to become a leading supplier of power steering systems and gears to the world's automotive leaders. Following our successes with DPCA, we also received our first purchase order with a global automotive manufacturer headquartered in North America."

"Our advanced power steering gears being shipped to DPCA are replacing products currently being imported into China. Our gears and systems have achieved global quality standards for these critical safety-related products, and we have a cost advantage which will benefit DPCA by using our products," Mr. Chen concluded.

The Purchasing Manager of DPCA and officers from PSA Global Procurement congratulated Henglong for meeting the stringent global quality standards which led to winning the DPCA contract. They also stated they look forward to continuing to work closely with CAAS as it is on its way to becoming a supplier to PSA Global in the future.

Henglong's manager reviewed how the company started development of three new power steering gears for DPCA in 2005. These three models were designed for the Peugeot 206, Elysee R23 and Picasso N68. Subsequently, all models passed the French UTAC safety test, road tests and inspections. In 2008, Henglong won commercial supply contracts for the Peugeot 206 and Elysee R23, and is continuing to work on orders for the Picasso N68 model.