Lithia Motors, Inc., Files Registration Statement for Resale of 2.875% Convertible Senior Subordinated Notes Due 2014

MEDFORD, Ore.--July 26, 2004--Lithia Motors, Inc. today announced that it has filed a registration statement on Form S-3 with the Securities and Exchange Commission (the "SEC") relating to the resale of $85,000,000 in aggregate principal amount of its 2.875% Convertible Senior Subordinated Notes due 2014 (the "Notes") and the shares of its Class A Common Stock issuable upon conversion of the Notes. The Notes were originally issued in a private placement in May 20, 200404.

When it is declared effective by the SEC, the registration statement will be available for use by the holders named therein to resell the Notes and the shares of Lithia Class A Common Stock issuable upon conversion of the Notes.

Lithia will not receive any proceeds from the sale by any selling shareholder of the Notes or the shares of Lithia Class A Common Stock issuable upon conversion of the Notes. When available, a copy of the prospectus (as supplemented) may be obtained from:

    Jeffrey B. DeBoer
    Senior Vice President and Chief Financial Officer
    Lithia Motors, Inc.
    360 E Jackson
    Medford, OR 97501

The Registration Statement relating to these securities has been filed with the SEC but has not yet become effective. The securities may not be sold nor offers to buy be accepted prior to the time the registration statement becomes effective. There shall not be any offer, solicitation of offers to buy, or sale of the securities in any jurisdiction in which such offer, solicitation or sale is unlawful. This press release does not constitute an offer to sell or the solicitation of an offer to buy securities.

Additional Information

For additional information on Lithia Motors, contact Jeff DeBoer, Senior VP and Chief Financial Officer, 541-776-6868 (e-mail: invest@lithia.com), or Dan Retzlaff, Director, Investor Relations, 541-776-6819.