SmarTire Signs Manufacturing Agreement with Hyundai Autonet (HACO)

Strategic relationship expanded to include manufacturing of SmarTire products

OTCBB: SMTR

RICHMOND, BC, Oct. 20 -- SmarTire Systems Inc. (OTCBB: SMTR) announced today that it has signed a contract manufacturing services agreement with Hyundai Autonet Company (HACO), a leading Korean automotive electronics supplier and a subsidiary of Hyundai Group. Under the terms of the agreement, HACO will manufacture the Company's proprietary line of tire pressure monitoring systems (TPMS) for sale and distribution globally by SmarTire. HACO's Tier One manufacturing status will provide SmarTire the opportunity to compete on a worldwide basis with higher quality products, an increased volume capability and a more flexible cost structure.

"It is vital to our ongoing success in the tire monitoring industry to have a strategic alliance with an established automotive parts manufacturer," stated Al Kozak, SmarTire's Chief Operating Officer. "HACO is a world class manufacturer and has demonstrated a solid commitment to the future of the tire monitoring industry. Building on its successful track record, HACO has the credentials to become a leading manufacturer of TPMS by providing SmarTire with the highest quality products on a competitive basis."

On February 10, 2003, SmarTire announced an agreement with HACO to co- develop, manufacture and distribute TPMS products to Korean original equipment vehicle manufacturers and to the automotive aftermarket in Korea. Based on that agreement, on July 8, 2003, SmarTire announced that HACO had been contracted by Hyundai Motor Corporation to develop a commercial vehicle TPMS. The development contract will study and validate tire pressure monitoring on commercial vehicles including trucks and buses in the Korean domestic marketplace.

HACO, originally founded in January 1985 as Hyundai Automotive Electronics Division, is a subsidiary of the Hyundai Group, one of Korea's largest conglomerate companies. HACO is a world-class automotive electronics manufacturer located in Kyoungki, Korea and is a major supplier of automotive electronics in Asia. Business areas include car audio systems, in-vehicle audio/visual entertainment systems, navigation systems, airbag electronic control unit and powertrain electronics. HACO has more than 1,200 employees and annual sales for fiscal 2002 exceeded US$420 million. Major customers include Hyundai Motor Company, KIA Motors Corporation, Ssangyong Motor Company and other international automobile manufacturers.

SmarTire Systems Inc. develops and markets proprietary tire monitoring systems for the transportation industry worldwide. Incorporated in 1987, SmarTire is a public company with offices in North America and Europe. Additional information can be found at www.smartire.com.

  'Robert Rudman'

  Robert Rudman
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