Lithium Technology Corporation Delivers a New Lithium Ion Battery System For Hybrid Car Project In Europe

PLYMOUTH MEETING, Pa.--April 4, 2006--Lithium Technology Corporation ("LTC") (OTC Bulletin Board:LTHU), a leading manufacturer in the rapidly emerging large format rechargeable Lithium battery market, announced today that it has delivered, through its wholly owned German subsidiary GAIA Akkumulatorenwerke GmbH in Germany, a Li-ion battery for a hybrid vehicle that is being developed by UK based automotive technology specialists Zytek Systems as part of the Energy Saving Trust's Ultra-Low Carbon Car Challenge (ULCCC).

In March 2005, Zytek was awarded grant funding from the Energy Saving Trust for the 2nd phase of their ULCCC project to develop a new high efficiency, dual mode hybrid vehicle. The vehicle is based on the new Smart forfour and will utilize a hybrid power train based on 1500cc, 3-cylinder turbo charged diesel engine coupled to 2 high-efficiency permanent-magnet electric motors.

Zytek has ordered three Li-ion batteries with output of 288 V, a capacity of 7.5 Ah (or about 2.2 kWh of energy) and with a capability to deliver 25 kW of power. These batteries can be charged by either the ICE, by regenerative breaking, or by household mains (plug-in hybrid), and will have a modest all-electric range. The first battery has been installed in the vehicle and road tests will commence shortly. The remaining two batteries will be delivered in April 2006.

LTC, together with Zytek and I+ME, have jointly developed an improved version of the Battery Management System (BMS) to include additional safety features and to control the charging of the battery from the mains. The BMS will also communicate with the vehicles energy management system for better efficiency and control.

Klaus Brandt, Managing Director of GAIA Akkumulatorenwerke, commented: "This project demonstrates an important step forward in the commercialisation of our products and technology in the HEV marketplace. Lithium-ion batteries are becoming the technology of choice for hybrid and electrical vehicles, and we at LTC have the proven capabilities to answer the growing demand."

About Lithium Technology Corporation

Lithium Technology Corporation is a manufacturer of large format rechargeable Lithium Ion batteries, custom engineered for military, automotive and industrial applications. LTC customers include top tier contractors to the military and suppliers to industrial concerns requiring safe, durable, high power rechargeable power supplies for their applications and the development of new technology. LTC is leveraging its expertise in high power and large battery assemblies to commercialize advanced lithium batteries as a new power source in the military and national security systems, transportation and stationary power markets with a particular focus on the U.S. and European geographic market segments where the customers prefer a domestic supplier.

LTC manufactures the GAIA(R) product line of large, high power hermetically sealed rechargeable lithium ion cells and batteries. The Company's product portfolio includes large cells and batteries from 10 times the energy of a standard laptop computer battery to 100,000 times greater. LTC produces high power cells designed for HEVs and military applications that can discharge hundreds of amps in times as short as a few minutes, and high capacity cells for applications such as back-up power and remote standby installations. Cells are manufactured in both cylindrical and flat form and employ proprietary extrusion, design and assembly technology. LTC manufactures a variety of standard cells that are assembled into custom large batteries complete with electronics (battery management systems) and electronics to communicate with other components of the system for performance monitoring.

LTC and LTC's GAIA Akkumulatorenwerke GmbH subsidiary operating in Nordhausen, Germany, have contracted with ThyssenKrupp (the largest builder of non-nuclear submarines) to provide power supplies for underwater propulsion of manned submarines. Other applications include a prototype of lighter-than-air communication "stratellites"; unmanned surveillance vehicles (air, land, and underwater based); surface to air missiles; standby power applications; renewable energy generation sources (windmills); and hybrid electric vehicles ("HEV") and electrical vehicles ("EV").

Lithium Technology has two principal centers of operation - in Plymouth Meeting, Pennsylvania and in Nordhausen, Germany. The Plymouth Meeting office is also the corporate headquarters for the Company. Sales into the U.S. and European markets are managed out of each of the offices.

For additional information on the Company's technology and products, please visit http://www.lithiumtech.com or http://www.gaia-akku.com.

About Zytek Systems

Zytek is at the forefront of automotive technology, being active in the fields of electronic control systems, high performance engines, concept electric and hybrid vehicles and electro/mechanical services.

Projects range from the development of systems for show cars and engineering prototypes, to design and validation of critical sections of production programs. The Zytek group also has the capability to manufacture control systems and electric drivetrains in low volumes, simplifying customers' development and field trial times with reliable hardware and software.

In motorsport, Zytek designs and manufactures engines, engine management systems and chassis, including bespoke commissions for individual clients. Substantial design and development capability is supported with resources to manufacture in sufficient volume for a major global race series. Installation and wiring expertise ensures fast, efficient integration with systems from other suppliers. Zytek's race heritage has bred a culture that delivers exceptional results for customers - race and road alike.

Further information about Zytek is available at http://www.zytekgroup.co.uk

About the Energy Saving Trust

The Energy Saving Trust was set up by the UK Government after the 1992 Earth Summit in Rio de Janeiro and is one of the UK's leading organisations addressing the damaging affects of climate change. It aims to cut carbon dioxide emissions by promoting the sustainable and efficient use of energy. The Energy Saving Trust is a non-profit organisation funded by government and the private sector.

The Energy Saving Trust's transport unit is working on behalf of governments to improve the quality of our environment. Funded mainly by the Department for Transport, the Scottish Executive and the Welsh Assembly Government, it works in partnership with the transport industry, corporate fleet sector and the public sector to help make the UK a cleaner and healthier place to live and work. For more information please visit www.est.org.uk/fleet