Lithia Motors Acquires Chevrolet Store in Caldwell, Idaho

                  Opens New Dodge Store in Anchorage, Alaska

    MEDFORD, Ore., Aug. 31 Lithia Motors, Inc.
announced today that it has completed the acquisition of Lanny Berg Chevrolet
in Caldwell, Idaho. The store has combined estimated 2001 sales of
$22 million. Lithia's net investment in the store totals approximately
$1.7 million and was paid in cash.

    Lithia Motors Chairman and CEO Sid DeBoer added, "Caldwell is
approximately 20 miles west of Boise, Idaho. This Chevrolet store is a perfect
addition to the Chevrolet store we have in the primary market of Boise. We
have had great success adding perimeter locations of like franchises to
markets where we already have a strong presence. Lithia now serves the Boise
market with Chevrolet, Ford, Lincoln-Mercury and Isuzu stores and franchises.
This marks the beginning of a more aggressive acquisition strategy to be
implemented throughout the rest of the year."

    Separately, earlier in the month, Lithia completed the construction and
opening of Lithia Dodge of Anchorage. With the addition of this new store,
Lithia now operates two stand-alone stores in Anchorage, Alaska representing
the Jeep, Chrysler and Dodge brands.

    Sid DeBoer added, "We now represent all of the Chrysler brands in
Anchorage, Alaska. The Anchorage market has great potential, and Lithia hopes
to grow in this market in much the same way as we did in Boise, through
strategic acquisitions."

    Lithia Motors, Inc. is a Fortune 1000 and Russell 2000 Company that
operates 117 franchises in California, Oregon, Washington, Nevada, Colorado,
Idaho, South Dakota and Alaska. Lithia sells 26 brands of new vehicles at
58 stores and over the Internet through "Lithia.com -- America's Car & Truck
Store." Lithia also sells used vehicles; arranges finance, warranty, and
credit insurance contracts; and provides vehicle parts, maintenance, and
repair services at all of its locations. Lithia retailed 68,126 new and used
vehicles and had $1.66 billion in total revenue in 2000.