China Automotive Systems Has Begun Commercial Supply to Chrysler North America

WUHAN, Hubei, China, Jan. 22, 2010; China Automotive Systems, Inc. , a leading power steering components and systems supplier in China, announced today at a Company ceremony that its first global OEM customer, headquartered in North America, is the Chrysler Group LLC ("Chrysler"). In November 2008, CAAS received its first order from Chrysler to export power steering gears to Chrysler's North America assembly facility. Since mid-2009, the steering gears have been exported from China to the United States and installed in the award-winning Jeep Wrangler model.

Part of the Company's ceremony included the ground breaking for the new Henglong Research and Development Center. After Mr. Hanlin Chen, CAAS Chairman's opening remarks, Mr. Xiangxi Wang, the Mayor of Jingzhou City, also provided remarks and presented the Exports Special Contribution Award to CAAS. Chrysler representative Mr. Peter Zhou, Chrysler's Director of Supplier Quality China and Taiwan presented the Proof of Certified Supplier certificate to China Automotive Systems based on the Company's performance in delivering the power steering gears.

Chrysler conducted an initial screen and review of CAAS's research and development capacity, quality control and production capabilities as part of the supplier development process. CAAS and Chrysler next created a framework for their future joint development. The Company successfully passed several product evaluations and road tests resulting in Chrysler accepting the Company's power steering gears and issuing a purchase order.

Mr. Hanlin Chen, Chairman of China Automotive Systems, commented, "We are very excited about our strengthening relationship with Chrysler and the deep potential for the vast North American OEM market. Chrysler's order boosted our confidence to continue to develop and produce reliable power steering systems reaching the highest quality standards required by the world's most sophisticated auto manufacturers."

During the ceremony today, CAAS also announced that it has begun production of its electronic power steering ("EPS") system. This new electronic power steering product and technology represents the first such steering system developed internally within China. The Company is currently supplying this EPS system at a rate of 2,000 units per month to Suzuki Auto Ltd. in China.

Mr. Qizhou Wu, CEO of China Automotive Systems, concluded, "We are also very pleased about the steady commercialization progress of our EPS products. Given the benefit of improving overall fuel efficiency, EPS systems are widely adopted by OEMs in Europe and gradually expanding market share in the U.S. OEM market. Although EPS systems are relatively new in China, we see great potential for EPS in China, the world's largest automotive market. We are proud to be the first Chinese power steering producer to introduce a domestically designed and manufactured product to compete with imported systems in the fast growing Chinese automotive market."

About China Automotive Systems, Inc.

Based in Hubei Province, People's Republic of China, China Automotive Systems, Inc. is a leading supplier of power steering components and systems to the Chinese automotive industry, operating through eight Sino-foreign joint ventures. The Company offers a full range of steering system parts for passenger automobiles and commercial vehicles. The Company currently offers 4 separate series of power steering with an annual production capacity of over 2.5 million sets, steering columns, steering oil pumps and steering hoses. Its customer base is comprised of leading Chinese auto manufacturers such as China FAW Group, Corp., Dongfeng Auto Group Co., Ltd., BYD Auto Company Limited, Beiqi Foton Motor Co., Ltd. and Chery Automobile Co., Ltd., etc. For more information, please visit: http://www.caasauto.com/