Record Gas Prices Fuel ZAP Auto Dealer Network

SANTA ROSA, Calif., June 21 -- Record gas prices and rising demand for fuel efficient cars are creating a wave of dealer interest for transportation pioneer ZAP (BULLETIN BOARD: ZAPZ) .

The Wall Street Journal reported that rising gas prices are spurring demand for gasoline-electric hybrids to such an extent that some dealers are tacking on markups of $5,000 or more on the top of the car's sticker price. In May, for the first time ever, the average price of gasoline rose over $2.00 per gallon, with reports of $4 per gallon for full service in some parts of the country. At the same time, manufacturers of hybrids report a backlog of 22,000 orders that cannot be filled.

ZAP is positioning itself to capitalize on this trend. ZAP, which stands for Zero Air Pollution(R), was founded to market personal electric transportation in 1994. With over 85,000 customers in the past nine years, the publicly owned company recently expanded to include energy efficient cars that run on gasoline and electricity. ZAP says that over 10,000 distributors around the world have inquired about joining ZAP's distribution network and ZAP CEO Steve Schneider says that the time has come for ZAP to create the dealer network for advanced transportation.

"ZAP's vehicles address many of the problems that are on consumers minds these days, particularly where it matters most -- their pocketbook," said ZAP CEO Steve Schneider. "Entrepreneurs in the auto business understand this opportunity as well and we now have dealers in many parts of the U.S. signed up to sell our line of energy-efficient transportation."

At the NIADA expo in Dallas June 8-12, auto dealers flocked to see ZAP's latest vehicles. The National Independent Auto Dealers Association (NIADA) comprises over 100,000 auto dealers throughout the nation. ZAP is targeting the top one percent of dealers to establish a nationwide network of automotive distributors that would target energy-conscious car-buyers, much like Honda and Toyota did in the 1970s. Dealers receive a new car dealer license by affiliating themselves with ZAP.

"We are being very selective by only signing up dealers who share our vision of where transportation technology is going," said Schneider.

ZAP owns a fleet of over 100 electric rental cars, the world's largest, and is looking at expanding into rental locations. ZAP is also developing a freeway-capable electric car and test-marketing a new 60 mile per gallon gas car on its website called SMART from Europe. In addition, ZAP is selling new neighborhood electric cars, all-terrain vehicles, as well as new electric bikes and scooters, like its new ZAPPY3. At the same time, ZAP is researching other types of automobiles to add to its dealer network, including cars powered by fuel cell and advanced battery technology. To find out more, contact ZAP Dealer Development at 707-525-8658. See them online at http://www.zapworld.com/ .

Forward-looking statements in this release are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including, without limitation, continued acceptance of the Company's products, increased levels of competition for the Company, new products and technological changes, the Company's dependence upon third-party suppliers, intellectual property rights, and other risks detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission.