Autoweb.com Stock Prices Fall to Record Low

29 July 2000

Friday Trading Closes with AWEB at 1 7/8

    Sacramento - July was not a very good month for online auto broker/seller
Autoweb.com.  They started the month continuing to fend off reports from
Goldman Sachs and Barrons that the company was running out of money.  On July
12th, the AWEB share price closed for the first time under $2.  On July 20th
there was a major executive level shakeup, in which Dean DeBiase had his duties
and title of CEO transferred to the company's top financial guy.  That same day
Autoweb.com's Second Quarter 2000 Report revealed that the company lost another
$6 million (bringing the total losses for the first six months of year 2000 to
$13.2 million)  The next day USB Piper Jaffray downgraded their recommendation
of AWEB.  Then finally, on the last Friday of the month, Autoweb.com's share
price hit its new all time low.

    Autoweb.com had originally gone public on March 23, 1999, with an opening
share price just over $21.  Just hours later, on March 24, 1999, AWEB hit and 
closed at its all time high of $50, giving the company an incredible market cap 
of nearly $1.5 billion.  But then the market changed and projected expectations
were not met.  One year ago today, AWEB closed at $12.81 (12 13/16), which is
more than 700% higher than today's closing price.  The company has continued to
struggle with increasing operational expenses and losses.  Based on today's 
closing share price its market cap is only about $55 million.

    While Autoweb.com executives continue to try and cast the company's current
financial position and future outlook in a positive light, many automotive,
financial, and Internet analysts would be quick to disagree.  It's believed
that Autoweb has had more than enough time to prove its business model.  With
the fragmenting of the market by a myriad of copy-cat competitors, along with
vastly improved Internet efforts by traditional bricks-and-mortar dealers, it
will only be more difficult for a "middleman" like Autoweb.com to find
profitability.  

    In June, Dean DeBiase spoke at the JD Power Automotive Conference in Boston. 
Mr. DeBiase declared Autoweb.com to be "business plan agnostic": a statement
that seems to confirm their uncertainty as to what they should do next.  

    Considering that the company was founded on a very specific business plan 
(one on which they raised several million dollars in private capital before 
going public); and then used the same plan to entice public financial 
participation, it was a shocking comment to hear.  One can only imagine how 
investors would have reacted on March 23, 1999 if they were openly told that 
the company had no idea of what to do next.   


Marc J. Rauch
Co-Publisher
mjrauch@theautochannel.com